1. This coursework consists of seven (7) pages including this page.

• Answer ALL questions.

The submission deadline is on 14 September 2021, 2359hrs. Late submissions without Leave of Absence (LOA) will be subjected to the following late penalty:

Time after submission deadline	Between 0 and < 24hrs	Between 24 and < 48hrs	Between 48 and < 72hrs	After 72hrs
Percentage of total marks deducted	5%	10%	15%	100%

1. A written report is to be submitted in response to the questions of this Coursework Assessment by the submission deadline. The report must be uploaded via SA 2.0.  A separate oral questioning session will be conducted and the timing will be made known by your lecturer.

• Disciplinary action will be taken against students who are found to plagiarise, both the party who allow their work to be copied as well as those who represent or copy the work of another person as one’s own.  Disciplinary action will include, but not limited to, an outright failure for the graded assignment and downgrading of the module grade.

• Please note that there will be no further extension of submission deadline.

For Official Use
Question No	Max	Marks
1	10
2	15
3	11
4	14			Name	:	_______________________
Total	50			Student ID	:	_______________________

Question 1 (10 marks)

The Royal Caribbean Company is a cruise ship operator, and is currently operating cruise-to-nowhere trips from Singapore.

1. Based on the above news article (Straits Times, 1 Apr 2021). Explain why Revenue Management is applicable to Royal Caribbean (specifically the “Quantum of the Seas” cruise ship). State your source of information. You can include this article and/or any external sources of information.  

• Provide three (3) examples of how Royal Caribbean can apply the Psychological Pricing Method to maximize its revenue.

 [10 marks]

The marking criteria for this section are shown below.

Criteria	Marks Allocated	Description
Understanding of Revenue Management	3 marks	Ability to provide the conditions for Revenue Management applicable to Royal Caribbean.Appropriate and relevant explanations with examples and sources provided.
Application and example of pricing methods	3 marks	Application of Psychological Pricing methods with reasonable examples and explanation.Assumptions and sources cited.
Oral Questioning	4 marks	Ability to answer to lecturer’s questions

Question 2 (15 marks)

Suppose you are helping a friend analyse the viability of buying a car for the purpose of earning income by using it as a private hire car. Using the three (3) Capital Budgeting techniques

1. Net present value
2. Payback period
3. Discounted payback period

You are required to do the following:

1. For each Capital Budgeting Technique, provide calculations and an explanation of whether your friend should buy the car based on the result. 

• Provide one (1) limitation of Capital Budgeting which is relevant in this context. Explain.

Instructions

• Assume the vehicle is purchased fully in cash at the beginning period (there is no loan).
  • Use a discount rate of 4% per annum
  • The Required Payback Period for both the Payback Period and Discounted Payback Period is 50% of the remaining useful life of the car (Example: if the remaining useful life of the car is 6 years the required payback is 6 years x 50% = 3 years).
  • Research on the cost price of a car (Example: Land Transport Authority Website or Car Dealer Websites) and the annual income of a private hire driver (Example: Private Hire Driver Websites and Forums).
  • State your assumptions of all the costs/income involved.
  • You are recommended to show the periods for the cashflows in years (instead of months).
  • Show your workings clearly in a table. You can use MS Excel or Google sheets for your calculations and must submit your workings in an attachment.
  • Cite your sources clearly.

 [15 marks]

The marking criteria for this section are shown below.

Criteria	Marks Allocated	Description
Data and Analysis	9 marks	Data presented are reasonable and the sources of the data are cited clearlyDetailed working steps are correct and clearly shownCorrect explanation of Capital Budgeting decision based on result of calculations.
Limitations and Explanation	2 marks	Correct and relevant limitations of Capital Budgeting provided.Relevant explanation of the limitations provided.
Oral Questioning	4 marks	Ability to answer to lecturer’s questions

Question 3 (11 marks)

Suppose you are operating a physical store selling daily provisions and goods from Singapore. Due to recent market conditions, you are considering shifting your business entirely online.

Using the anchor decision as deciding to shift your business from a physical store to an online store. You are required to do the following;

• Provide an example of a/an

• Relevant revenue,
• Relevant cost and;
• Relevant savings
• Irrelevant cost

• Explain the classification (Items i to iv). State your assumptions and source data.

You should use the following example and table as a guide. 

Item	Estimated Amount	Relevant	Explanation (Anchor Decision: To shift the business from a physical store to an online store)
Example: Utilities	$400	Yes Relevant Savings	Utilities expense would be saved if the company decided to go online instead of operating a physical store since the company would not have to pay for utilities if it operates entirely online.   There would be relevant savings of $400 based on the assumption on savings on utilities on a 1,000 square feet retail space.   (source: SPGroup.com.sg)
Item 1	XX	Yes Relevant Revenue	XX
Item 2	XX	Yes Relevant Cost	XX
Item 3	XX	Yes Relevant Savings	XX
Item 4	XX	No Irrelevant Cost	XX

The marking criteria for this section are shown below.

Criteria	Marks Allocated	Description
Analysis on relevant information for decision making	8 marks	Correct example of relevant and irrelevant revenue or cost/savings.Appropriate explanation of the relevant and irrelevant revenue or cost/savings in the context of the decision. Reasonable assumptions with sources cited (if any).
Oral Questioning	3 marks	Ability to answer to lecturer’s questions

Question 4 (14 marks)

Assume that you are the Management Accountant for a merchandising company which sells power banks bought from a supplier overseas.

Additional Information

• Forecast Sales Volume is shown as below

Forecasted sales	No. of power banks (in units)
Sep 2021	3,760
Oct 2021	3,900
Nov 2021	4,230
Dec 2021	4,180

• Determine the cost price and selling price per unit by researching online. State your assumptions and cite your sources clearly.

• 70% of each month’s sales are estimated to be cash sales and the remainder will be credit sales. All credit sales will be received in the following month. No uncollectible accounts are anticipated.

• 60% of the expenses relating to the purchase of power banks will be paid in the month of expenditure. The remainder will be paid in the following month. No non-payments are anticipated.

• Selling and Administrative Expenses are expected to remain constant at $8,000 per month, and will be paid within the month.

• Beginning Cash for Sep 2021 is expected to be $10,000

You are required to do the following

1. Prepare the

• Cash Receipt Budget;
• Cash Disbursement Budget; and
• Cash Budget

For October to December 2021, based on the information above.

• Provide one (1) explanation, with an example, on why preparing an Operational Budget would be beneficial for your company.

[14 marks]

The marking criteria for this section are shown below.

Criteria	Marks Allocated	Description
Data and Calculations	12 marks	Ability to come up with the Cash Receipt, Cash Disbursement and Cash Budget. Data presented are reasonable and the sources of the data are cited clearly.Detailed working steps, correct and clearly shown
Analysis	2 marks	Correct explanation on the usefulness of an Operational Budget.Relevant explanation with examples cited.

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