ASSESSMENT GUIDE
\nBAFN602: Corporate Finance
\nSemester 1, 2023
\nAssessment Method: Individual presentation
\nAssessment number: 1
\nAssessment Artefact: Oral presentation and written PowerPoint submission
\nWeighting [30%]
\nMarks [90]
\nWhy this assessment:
\nTypes of employability skills that will be acquired upon completion of this assessment
\nOverview of Assessment
\nThis assessment task consists of a presentation, excel calculations and a PDF of the presentation
\nequivalent to a 1000-word research report. This task requires students to comment on a company\u2019s
\nstrategies and apply capital budgeting techniques to investment decision-making. It requires students to
\ndraw on their critical thinking and ethical perspectives to make decisions.
\n\u2022 Provides an opportunity for students to apply theoretical ideas of capital budgeting and
\ncapital budgeting techniques to hypothetical investment projects
\n\u2022 Provides an exposure to real-life scenarios
\n\u2022 The feedback from this assessment will help students to improve their performance in the
\nfinal assessment.
\nSkill Type
\nDeveloped critical and analytical thinking \u2612
\nDeveloped ability to solve complex problems \u2612
\nDeveloped ability to work effectively with others \u2610
\nDeveloped confidence to learn independently \u2612
\nDeveloped written communication skills \u2612
\nDeveloped spoken communication skills \u2612
\nDeveloped knowledge in the field study \u2612
\nDeveloped work-related knowledge and skills \u2612
\nDevelop effective research skills \u2612
\nDue date 7
\nth April 2023
\nWeighting 30%
\nLength and\/or format 10-minute video presentation, excel spreadsheet and Power Point Slides
\nLearning outcomes assessed LO2
\nGraduate attributes assessed GA5; GA7
\nHow to submit Turnitin
\nReturn of assignment Turnitin
\nAssessment criteria Rubric – grade miners score: See end of document
\n2
\nINSTRUCTION AND CONTEXT
\nThis assessment requires students to analyse long-term investment projects, present the results in a video
\nand submit the video together with PowerPoint slides using LEO through Turnitin. The tasks involve
\nassessing the viability of proposed projects by analysing their risk and reward assessment task profiles.
\nYou must choose one (1) of the three (3) listed scenarios at the end of this assessment guide and premised
\non the given background, apply the principles of capital budgeting and investment decision criteria to
\nassess the viability of the selected projects.
\nThe road transport industry is one of the essential sub-sectors of the Transport, post, and warehousing
\nindustry. Its relevance is earmarked by the proposed $120 billion investment in transport over the next
\nten (10) years in the 2022-2023 federal budget. This investment is expected to spur growth in the
\ntransport sector for the next ten (10) years.
\nYou have been tasked to prepare relevant documentation which would form the basis for a presentation
\nto be delivered to the board of directors. To ensure that the relevant issues are addressed, you are
\nrequired to provide an appropriate response to the following questions:
\nRequired:
\n1) What is the nature of the relationship between the projects of your selected scenario and how
\ndoes it affect the company\u2019s investment decision making.
\n2) Assess any relevant business strategy that would be appropriate for firm expansion in your chosen
\ncontext
\n3) Determine the free cash flow of the projects associated with your selected scenario highlighting
\ninitial outlay, operating cash flows, depreciation, changes in net working capital, and terminal
\nvalue.
\n4) Assess the viability of the projects associated with your selected scenario using net present value
\n(NPV), internal rate of return (IRR), and profitability index (PI).
\n5) Assess the financial risk of the selected using sensitivity analysis and comment on the risk assessment task profile
\nof the projects. Assume 20% change in cost of operation for the chosen scenario
\nEach student will make an oral presentation via Zoom at a mutually agreed time and date in week
\ncommencing 17 April 2023. Presentation will be of 10-minute duration. You are required to answer the
\nquestions specified in this assignment. You are expected to use visual materials such as PowerPoint.
\nGrading will be based on the rubric that can be found at the end of this document.
\nYou should submit your PowerPoint slides and workings via Turnitin by 7th April 2023.
\nOral Presentations
\nOral presentation and debating skills are valued by managers\/employers. important in business. Oral
\npresentations are common in business life, and you will be required to make presentations many times
\nand in various settings. Therefore, developing such skills are essential for a successful professional life.<\/p>\n
Rubric – grade miners scores \u2013 Assessment 1 (30%)<\/p>\n
SCENARIO 1
\nAllied Express Group (AEG) is a courier and freight company with operations which is primarily focused on providing
\ntransport services to clients located in the urban centres of Melbourne, Australia. With the current goal of
\nincreasing its market share of the transport sector, management of AEG has proposed an expansion in business
\noperation to boost its market share. In the view of this, the board of directors is currently considering two projects
\nfor investment: an acquisition of existing regional freight company and\/or the setting up of regional operation.
\nThe chief financial officer (CFO) has presented the following financial data as reasonable estimate for the two
\nprojects based on reasonable assumptions.
\nAcquisition of existing regional freight company
\nItem Growth rate\/inflation
\nPurchase price $120 million
\nProject duration 10 years
\nCost of operation 30% of revenue 8% per year
\nOpportunity cost (years 3 to year 6) $105,000
\nOther operating cost (Year 1) $120,000 2% per year
\nSalvage value:
\nBuilding
\nTruck
\n$1.5 million
\n$15 million
\nApplicable depreciation method: Building
\nTruck
\nPrime cost
\nDiminishing value
\nRevenue (Year 1) $30 million 5% per year
\nNet operating working capital $100,000 5% per year
\nAdditionally, the CFO has noted that the purchase price includes $5 million used for feasibility study and $25 million
\nwhich relates to the value of a non-depreciable asset. 20% of the remaining amount relates to buildings with the
\nrest representing trucks acquired. 35% of the other operating cost represents shared-based compensations.
\nSetting up of a regional operation
\nItem Growth rate\/inflation
\nPurchase price $98 million
\nProject duration $10 years
\nCost of operation 30% of revenue 6% per year
\nOpportunity cost (years 1 to year 5) $120,000
\nOther operating cost (Year 1) $145,000 2.5% per year
\nSalvage value: Building
\nTruck
\n$1 million
\n$5.2 million
\nApplicable depreciation method:
\nBuilding
\nTruck
\nPrime cost
\nDiminishing value
\nRevenue (Year 1) $25 million 3% per year
\nNet operating working capital $250,000 10% per year
\nThe purchase price includes $2.5 million spent on market survey and $27.5 million for land that was acquired. 30%
\nof the remaining amount represents the value of building with the remaining representing the value of trucks
\nacquired. Other operating cost is made of up of 20% non-cash expenses.
\nThe tax rate is 30%. All cash flows are annual and are received at the end of the year. Both projects have weighted
\naverage cost of capital 10%.
\n7
\nSCENARIO 2
\nCoastal Service Transport (CST) is considering two projects for its firm expansion strategy. As a company which
\npredominantly focuses on international freight services, the firm is seeking to make inroads into the local freight
\nservices in Australia. In view of this, the firm is considering an investment in a door-to-door freight service as well
\nas a truck servicing operation. During the first board meeting, the financial manager presented the following
\nfinancial information for the proposed projects:
\nDoor-to-door freight services
\nItem Growth rate\/inflation
\nPurchase price $50 million
\nProject duration 10 years
\nCost of operation 35% of revenue 7.5% per year
\nOpportunity cost (years 2 to year 5) $125,000
\nOther operating cost (Year 1) $95,000 5% per year
\nSalvage value:
\nTruck $9 million
\nApplicable depreciation method:
\nTruck Diminishing value
\nRevenue (Year 1) $12 million 3.5% per year
\nNet operating working capital $130,000 5% per year
\nTruck servicing
\nItem Growth rate\/inflation
\nPurchase price (Equipment – 70% and building – 30%) $70 million
\nProject duration 10 years
\nCost of operation 30% of revenue 5% per year
\nOpportunity cost (years 1 to year 4) $130,000
\nOther operating cost (Year 1) $70,000 4% per year
\nSalvage value:
\nBuilding
\nEquipment
\n$5 million
\n$3.5 million
\nApplicable depreciation method:
\nBuilding
\nTruck
\nPrime cost
\nDiminishing value
\nRevenue (Year 1) $11 million 10% per year
\nNet operating working capital $180,000 3% per year
\n12.5% of the purchase price relates to expenses incurred for market research conducted for the truck servicing
\noperation.
\nThe tax rate is 30%. All cash flows are annual and are received at the end of the year. Both projects have weighted
\naverage cost of capital 14%.
\n8
\nSCENARIO 3
\nPack & Carry Group (PCG) is a truckload carrier which specialises in the hauling of large shipments for long distance.
\nDue to the highly competitive nature of this segment of freight services, the management of PCG is considering an
\nextension to its services to include either Four Axle Semi-Trailer Combination or Nine axle B-Double Combination.
\nBoth trucks are expected to help increase the firm\u2019s capacity to carry more loads across longer distances. Below
\nare the estimates of the financial information which relate to the two investments:
\nFour Axle Semi-Trailer Combination
\nItem Growth rate\/inflation
\nPurchase price $95 million
\nProject duration 10 years
\nCost of operation 40% of revenue 6% per year
\nOpportunity cost (years 1 to year 6) $160,000
\nOther operating cost per year $103,000
\nSalvage value:
\nTruck $2.5 million
\nApplicable depreciation method:
\nTruck Diminishing value
\nRevenue (Year 1) $35 million 3% per year
\nNet operating working capital $200,000 5% per year
\nNine Axle B-Double Combination
\nItem Growth rate\/inflation
\nPurchase price $110 million
\nProject duration 10 years
\nCost of operation 35% of revenue 4% per year
\nOpportunity cost (years 2 to year 6) $190,000
\nOther operating cost per year $179,000
\nSalvage value:
\nTruck $20 million
\nApplicable depreciation method:
\nTruck Diminishing value
\nRevenue (Year 1) $40 million 3% per year
\nNet operating working capital $150,000 3.5% per year
\n$10 million which was spend on market survey for both projects are included the purchase price of both projects.
\n40% relates to the Nine Axle B-Double Combination project.
\nThe tax rate is 30%. All cash flows are annual and are received at the end of the year. Both projects have weighted
\naverage cost of capital 12%.
\nThis assessment is an individual presentation that requires students to analyze long-term investment projects, present the results in a video, and submit the video together with PowerPoint slides using LEO through Turnitin. The tasks involve assessing the viability of proposed projects by analyzing their risk and reward assessment task profiles. Students must choose one of the three listed scenarios and, premised on the given background, apply the principles of capital budgeting and investment decision criteria to assess the viability of the selected projects.<\/p>\n
The assessment requires students to develop critical and analytical thinking, ability to solve complex problems, confidence to learn independently, written communication skills, spoken communication skills, knowledge in the field study, and work-related knowledge and skills. The learning outcomes assessed include LO2, and the graduate attributes assessed include GA5 and GA7. The assessment criteria include analyzing the relationship between the projects, assessing relevant business strategy, determining the free cash flow, assessing the viability of the projects, and assessing the financial risk of the selected project.<\/p>\n
The scenario provided involves Allied Express Group (AEG), a courier and freight company with operations that is primarily focused on providing transport services to clients located in the urban centers of Melbourne, Australia. The company aims to increase its market share of the transport sector, and management of AEG has proposed an expansion in business operation to boost its market share. The board of directors is currently considering two projects for investment: an acquisition of an existing regional freight company and\/or the setting up of a regional operation. The CFO has presented financial data as reasonable estimates for the two projects based on reasonable assumptions.<\/p>\n","protected":false},"excerpt":{"rendered":"
ASSESSMENT GUIDE BAFN602: Corporate Finance Semester 1, 2023 Assessment Method: Individual presentation Assessment number: 1 Assessment Artefact: Oral presentation and written PowerPoint submission Weighting [30%] Marks [90] Why this assessment: Types of employability skills that will be acquired upon completion of this assessment Overview of Assessment This assessment task consists of a presentation, excel calculations […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5584,5217,5589,5586,5591,5594,5590,5587,5583,5593,5592,5588,5582,5585,5595],"tags":[5597,5601,5602,5605,3665,5603,2339,5607,4868,5598,5604,5606,5600,3325,5599,5596],"class_list":["post-14237","post","type-post","status-publish","format-standard","hentry","category-assessment-homework-help-online","category-australia-essays","category-best-ideas-for-dissertation-topics","category-best-ideas-for-research-paper-topics-in","category-best-thesis-topics-and-ideas-on-different-subjects","category-dissertation-topics-good-thesis-ideas","category-dissertation-topics-for-ph-d-and-thesis-ideas","category-dissertation-topics-for-students-in","category-help-with-australia-assessment-assignment","category-research-topics-for-college-students","category-sample-thesis-titles","category-trending-dissertation-topics-ideas-for","category-uk-assessment-assignment-help","category-uk-essays","category-undergraduate-dissertations-topics-examples-ideas","tag-essay-service-website","tag-essay-writer-from-usa","tag-hire-a-professional-essay-writer","tag-hire-essay-writer-for-your-papers","tag-i-need-help-writing","tag-i-will-pay-someone-to-write-my-essay","tag-looking-for-someone-to-do-my-assignments","tag-online","tag-page-paper","tag-pay-for-essay-get-top-quality","tag-pay-someone-to-write-my-paper","tag-professional-paper-writing-service","tag-professional-to-write-my-essay","tag-write-a-paper","tag-write-my-essay-for-me-by-native-writer","tag-write-my-essay-no-plagiarism"],"_links":{"self":[{"href":"https:\/\/www.colapapers.com\/uk\/wp-json\/wp\/v2\/posts\/14237","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.colapapers.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.colapapers.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.colapapers.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.colapapers.com\/uk\/wp-json\/wp\/v2\/comments?post=14237"}],"version-history":[{"count":0,"href":"https:\/\/www.colapapers.com\/uk\/wp-json\/wp\/v2\/posts\/14237\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.colapapers.com\/uk\/wp-json\/wp\/v2\/media?parent=14237"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.colapapers.com\/uk\/wp-json\/wp\/v2\/categories?post=14237"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.colapapers.com\/uk\/wp-json\/wp\/v2\/tags?post=14237"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}