Answer the following questions based on the report of LTT Aquaculture SdnBhd..
1. Describe the nature of the business of LTT Aquaculture SdnBhd..
Answer:
The nature of business for LTT Aquaculture SdnBhd is rearing fresh water fish.
2. Identify 6 resources of the business considered as assets from an accounting point of view. Explain why these resources are considered as assets of the business.
Answer:
a) Empurau fish (1.5kg and above) - This is considered as current asset as they are selling this to generate profit
b) Brood stock (8 kg) - This is considered as non-current asset as it helps to generate more resources
c) Farm - This is considered as property, plant & equipment
d) Special effect concrete pond system - This is
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This company will have a profit, but will not have the cash receive because it will be transformed into another asset which will be generated more resources.
Accounting information would be useful to help LTT management to make decision?
• Return on investment (ROI) might be useful where the management can estimate the return that could acceptably on the investment that they have initiated for 3 years.
• Future cash flow would also give an indicator on how much inflow and outflow.
4. How would money spent on developing the land, maintenance of the ponds and feeding empuraus be treated as? (Use the accounting equation to figure out the answer).
Cash spending transaction can be illustrated as per below:
Answer: A = L + OE
1. + Develop Land - Capital (cash)
2. - Cash - Pond maintenance
3. - Cash - Feeding
1 - LTT using cash from capital to develop land thus capital will reduce and asset will increase. Concept of accounting equation where resource (develop land) must come from source (capital).
2 - Owners equity comprised of three elements. They are capital, profit/loss and operating expenses. It this case, pond maintenance and feeding empurau will reduce cash from asset.
5. Several potential buyers have visited the farm and were impressed and
Aquaculture can be defined as farming of aquatic organisms such as fish, crustaceans, molluscs and aquatic plants both in freshwater and saltwater. It has a wide range of ownerships from small family business to multimillionaire global industries.1It provides many job opportunities throughout the world. As an example Canadian aquaculture industry valued $ 5 billion Canadian dollars provides more than 130 000 jobs only in Canada.2Accelerated growth of aquaculture causes series of problems to both human health and environment.3Most bacterial species resides both in animals and well as in human will pathogenic to both. transfer of pathogens between the two host species is a common situation for most organisms.4 Most of the developing country aquatic farms are non-hygienic and stressful. This will lead to an increase of bacterial infection among most aquatic species. As a preventative and curative method farmers mix a huge amount of antimicrobial products with the aquatic feed.5 Since aquaculture is a global industry, Implemented laws and regulations are different from country to country. It is very difficult to implement global regulations relating to antimicrobial use.1
f. The largest use of cash from investing activities is for Capital Expenditures at $399 million. p. 42
assets to fund operations and pay expenses. Continued low sales and limited assets is a
eventual disposition of the asset (asset group). That assessment shall be based on the carrying amount
EEC calculated the amount of time involved the anticipation of its cost ($3 million). The timeline in recovering their cost of investment ($2 million) initially for the foundation of this investment any profit made in the future of this investment will be justified as a profit for the company. If EEC can anticipate a fast return on its investment it is a profitable wise decision in making the investment financial, it is considered to be an easier way of formulating investments financially. On the basis of one year all cash flows is added together equal to the sum of $2 million originally invested, then it is divided by the annual cash flow of $500,000. The calculation of the payback period would equal four years. After this time frame any financial proceeds will be considered profitable for the company. I conclude that the timeframe is adequate in comparison of the investment in this worthwhile investment financial venture for the company.
I. You must have an in-depth explanation of how these could achieve the aims and objectives of your business proposal.
Classify each of the items as an asset, liability; revenue; or expense from the company's viewpoint. Also indicate the normal account balance of each item.
taxes, wages) or amount owed. Equity is also known as owner’s net worth, stockholders’ equity, etc. or amount vested with no obligation to payback. This difference is known as the net asset or net worth of the company
1. What percentage of total assets consists of purchased intangible assets, net, at July 27th, 2013? At July 28th, 2013? What type of events triggered the existence of these intangible assets?
According to his financial model, the investment generates positive cash flow, excluding the initial investment, over the life of investment. This indicates further capital will not need to be raised for
That way, even with the company losing money there will be sufficient funds within the
Yes, I think that this company should build a new plant that allows them to grow in the industry, even if they are unable to use the Industrial Revenue Bond, they will have other financing alternatives.
The current assets are those which are readily convertible into cash and cash equivalents due to their highly liquid nature and also form part of working capital of the company’s operations. However, the long term assets in contrast are not liquid because since they have a useful life of more than a year and hence their full value cannot be easily realized within
1. Define the term “incremental cash flow”. Since the project will be financed in part by debt, should the cash flow analysis include the interest expense?