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8/18/2019 cape mob unit 1 ia
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TheaimofthisresearchistoconcentrateonthesystematizationofCourtsJamaicaLimited.T
hefocusisontheBusinessAccountingandFinances-
Module3.Theobjectiesofthebusinessareto!roidea"ordablefurnitureanda!!liancesto
theJamaican!eo!le#createaluesfortheirstoc$holdersby!roiding%ualitygoodsandserices#ma$ehugeamountsof!ro&tandselllargeamountsofshares.Thisresearch'asdonei
ntheconte(tgras!ingthebusinessas!ectsofthebusinessenironment#includingtheoreti
cal$no'ledgeoftheseas!ectsfroma!racticalstand!ointofo'ningbusiness.Also#thisres
earchgiesmeachancetostartmye(aminations'itht'enty!ercent)*+,oftheaailable
mar$s.
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This!rojectisdesignedtothoroughlyresearchalegalformofbusiness.The!rojectinoled
thereleantinformationthat'illgiestudentsthegeneralunderstandingofho'sucha&rm
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o!erates.Thecontentsoftheresearchsee$stogieacom!rehensieroundu!ofallthearea
softhebusiness#ho'eer#s!eci&cattention'asfocusedinthreebroadareasintheo!eratio
n&eld.This!rojectcoerstheareasthatareincludedintheunitoneCaribbeanAdanced/ro
&ciency0(amination)CA/0syllabusforManagementofBusiness.This!roject'illloo$s!e
ci&callyonModulethreeofthesyllabus'hichdeals'iththecom!anyAccountingandFinan
cing.Theareas'hich'illbecoeredare1 Thebusinesssourceo2nanceCriteriaforsee$ing&nanceseofaccountinginformationAccounting!roceduresandmeasuresFinancial
statementandanalysisMajorconce!tsThis!rojectalsocontainsacha!terthatloo$satthe
business!ublishedaccounts.Theinformation!lacedinthissection'asthoseobtainfromt
hesecondarysourceofdatacollection4
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5nordertoaccuratelyobtainthereleantinformationneededtocom!letethis!rojectboth!
rimaryandsecondarymethodsofdatacollection'ereused.The!rimarymeanofcollecting
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datainoledtheuseof%uestionnaire.The%uestionnaireconsistedoft'enty%uestions#of
o!enandclosedended%uestions.The%uestionnaire'aserysim!letouseandans'eredal
lthe%uestionstheresearcherneededtoe"ectielycom!ilehis!roject#hence#themethode
"ectieand'ides!read.Atotalofthree%uestionnaires'ereissuedusingarandomsam!lin
ga!!roach.6econdarymeansofdatacollectioninoledtheuseofte(tboo$s#ne's!a!ers
andmagazines.Thismethodofdatacollectionalso!layedanim!ortantroleinthee"ectiecom!ilationofmy!roject.Thete(tboo$usedinthedatacollection!rocess#containedthegen
eralinformationthatcorres!onded'iththeCA/0syllabus#theseinformation!roidedalin
$agebet'een'hatisbeingthoughtand'hatitisactuallyli$einthebusiness!lace.Theinfor
mationthatthene's!a!ersandmagazinescontained'asitaline"ectiecom!letionofth
eresearch.The!ublishedaccountsofthe&rm'erefoundinthesemeansofdatacollection.T
heset'osourcesusedinthedatacollection!rocess'eresu2cienttocom!letemyresearch
.Theresearcherduringtheresearchfacedfe'!roblemssuchas1limitedamounttohaeath
oroughresearchontheto!ic#duetothefacttheresearchertimehadtobebalancedout'itho
therinternalassessments.Another!roblemfacedbytheresearcher'asthathedidnotha
eenoughe%ui!menttogettheassessmentdoneontime.7
8. An inestigation into the Accounting and Financing of Courts JamaicaLimited.:ame 1 Ale( 0llis6chool 1 ;berlin 1
8+++?7Teacher 1 Ms ColemanCentre > 1 8+++?7@ate 1 A!ril *+88 8
*. Content /ageAc$no'ledgement 3Aims 5ntroduction and ;bjecties
4Methodology 0m!loyed 7=e!ort - 8*Conclusions and =ecommendations
83Bibliogra!hy 8A!!endices 84 - *+ *
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3. This !roject is the fruit of concerted e"orts. A !roject of this magnitude 'as
e"ectiely com!iled 'iththe assistance and contribution of a number of indiiduals
gratitude must be e(tended to such !ersons. The researcher 'ould li$e to than$
Dod almighty for giing him the health and strength he need tocom!lete this
Management of Business 5nternal Assessment# so as to meet the re%uirements of
the CaribbeanAdanced /ro&ciency 0(amination syllabus. The researcher 'ould li$eto gie credit to his teacher Miss Coleman for the role she !layed inoutlining the
tas$ 5 am e(!ected to !erform. 5 'ould li$e to e(!ress my 'armest than$s to my
friends at school 'ho contributed signi&cantly to my!roject. Finally# 5 'ould li$e to
say than$s to the sta" at the schoolEs com!uter labs that 'ent beyond the callof
duty to ensure that the necessary resources 'ere aailable and the attention 'as
forth coming so that my!roject 'as com!leted e2ciently. 3
. The aim of this research is to concentrate on the systematization of Courts
Jamaica Limited. The focusis on the Business Accounting and Finances- Module 3.
The objecties of the business are to !roidea"ordable furniture and a!!liances to
the Jamaican !eo!le# create alues for their stoc$holders by !roiding%uality goodsand serices# ma$e huge amounts of !ro&t and sell large amounts of shares. This
research 'asdone in the conte(t gras!ing the business as!ects of the business
enironment# including theoretical$no'ledge of these as!ects from a !ractical
stand!oint of o'ning business. Also# this research gies me achance to start my
e(aminations 'ith t'enty !ercent )*+, of the aailable mar$s.
4. This !roject is designed to thoroughly research a legal form of business. The
!roject inoled thereleant information that 'ill gie students the general
understanding of ho' such a &rm o!erates. Thecontents of the research see$s to
gie a com!rehensie round u! of all the areas of the business# ho'eer#s!eci&c
attention 'as focused in three broad areas in the o!eration &eld. This !roject coers
the areas that areincluded in the unit one Caribbean Adanced /ro&ciency
0(amination )CA/0 syllabus for Management ofBusiness. This !roject 'ill loo$
s!eci&cally on Module three of the syllabus 'hich deals 'ith the
com!anyAccounting and Financing. The areas 'hich 'ill be coered are1 The
business source of &nance Criteria for see$ing &nance se of accounting
information Accounting !rocedures and measures Financial statement and
analysis Major conce!ts This !roject also contains a cha!ter that loo$s at the
business !ublished accounts. The information!laced in this section 'as those obtain
from the secondary source of data collection 4
7. 5n order to accurately obtain the releant information needed to com!lete this
!roject both !rimary andsecondary methods of data collection 'ere used. The
!rimary mean of collecting data inoled the use of%uestionnaire. The %uestionnaire
consisted of t'enty %uestions# of o!en and closed ended %uestions.
The%uestionnaire 'as ery sim!le to use and ans'ered all the %uestions the
researcher needed to e"ectielycom!ile his !roject# hence# the method e"ectie
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and 'ides!read. A total of three %uestionnaires 'ere issuedusing a random
sam!ling a!!roach. 6econdary means of data collection inoled the use of
te(tboo$s# ne's!a!ers and magazines. Thismethod of data collection also !layed
an im!ortant role in the e"ectie com!ilation of my !roject. Thete(tboo$ used in the
data collection !rocess# contained the general information that corres!onded 'ith
theCA/0 syllabus# these information !roided a lin$age bet'een 'hat is beingthought and 'hat it is actuallyli$e in the business !lace. The information that the
ne's!a!ers and magazines contained 'as ital in e"ectiecom!letion of the
research. The !ublished accounts of the &rm 'ere found in these means of data
collection.These t'o sources used in the data collection !rocess 'ere su2cient to
com!lete my research. The researcher during the research faced fe' !roblems such
as1 limited amount to hae athorough research on the to!ic# due to the fact the
researcher time had to be balanced out 'ith other internalassessments. Another
!roblem faced by the researcher 'as that he did not hae enough e%ui!ment to get
theassessment done on time. 7
.
?. The Courts Jamaica Limited as the name suggested is a !ublic limited com!any#
that is to say that thebusiness is !riately o'ned by shareholders and its shares are
listed on the Jamaica 6toc$ 0(change and theseshares are freely transferable of the
com!any are !ublished on a yearly basis in the form of annual re!orts andare o!en
to !ublic scrutiny. This means that the business has little !riacy in its o!eration. 5t
is domiciled inJamaica and also a subsidiary of Courts Furnishers );erseas Limited
'hich is incor!orated in 0ngland and'hich is seenty nine !oint nine !ercent
)., of the com!anyEs issued stoc$ units. An economic system is the frame'or$
design to allocate the scarce resources of a country. Theresources of Jamaica are
allocated through a mi(ed economic system in this system there is some !riate
andsome !ublic o'nershi! of its economic resources. 5n this ty!e of economic
system# Courts Jamaica Limited isforced to !roduce a 'ide range of %uality furniture
and a!!liances at an a"ordable !rice to the Jamaicanconsumers# in order to
e"ectiely com!ete on the local mar$et. 5n this ty!e of economy the com!any
alsoforces restrictions and la's# 'hich may a"ect its o!eration. Courts Jamaica
Limited and all other businesses are faced 'ith the !roblem of &nancing
businessactiities. The com!any has the need to &nance its 'or$ing ca!ital and itEs
the day to day &nance# needed to!ay bills and e(!enses and to build u! stoc$s.
Businesses also need to &nance inestments such as s!ecial!rojects and
e(!ansions. Courts Jamaica Limited &nance the needed to increase the &rmEs ca!italassets 'henthe com!any underta$es e(!ansion# the com!any on occasion !ay for
research and deelo!ment of ne'!roducts. 5n general com!anies hae a ariety of
sources 'hich it can &nance from these sources are normallyinternal or e(ternal
sources. The internal sources of &nance include retained !ro&t )is !ro&t after ta(
that hasnot been returned to o'ners# 'or$ing ca!ital and sale of asset. 0(ternal
sources include share ca!ital# loanca!ital such as mortgage and debentures also
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ban$ oerdraft and trade credit. The diagram belo' sho's thecom!any sources of
&nances. ?
. 6;=06 ;F F:@ 5:T0=:AL 0GT0=:AL=0TA5: 6AL0 ;F A660T/=;F5T 6
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in a monetary alue 'hile historical cost sti!ulates that all assets are alued
according to theiroriginal cost rather than 'hat they currently 'orth. Financial
statements are formal records of the &nancial actiities of a business. A limited
com!any set o2nancial statements includes a balance sheet )a summary at a !oint
in time of business assets# liabilities andca!ital# income statement )sho's the a
business income after e(!enses and ta( from o!erating !ro&t# casho' statement)sho's a com!any sources and uses of cash in a trading !eriod and notes 'hich
e(!lained the&gures in the other &nancial statements. The &nancial statements of
the com!any are structured in a !articular manner and must certain $eyelements
'hich they must consist. 0ach &nancial statement has its o'n !ur!ose as stated
aboe 'here a briefdescri!tion of their !ur!ose 'here gien. 8+
88. The balance of the com!any should contain the follo'ing1 the com!any assets#
its liabilities and thecom!any e%uities. The balance sheet should hae the com!any
name on it the date for 'hich it had been!re!ared for and the currency 'hich it
being e(!ressed in. The assets should be listed &rst then follo'ed bythe liabilities
then e%uities. The income and cash o' statement should enlist the reenues# thegains# e(!enses# !ro&ts or losses andthe com!rehensie income. They should also
gie the com!any name# the date for 'hich it is !re!ared for andthe currency 'hich
it is e(!ressed in. =atio analysis is done by com!aring and assessing a com!any
!erformance by means of accounting data.The net !ro&t margin as a !ro&tability
ratio assesses ho' successful the management of a business has been atearning
!ro&ts for the business. The ratio com!ares the business net !ro&ts for the
business. The ratiocom!ares the business net !ro&ts for the business net !ro&t 'ith
its sales. Dross /ro&t Margin ), K Dross /ro&t ( *#44*#*3 ( 8++ K 44.7, 6ales
Turnoer #48#+ Courts Jamaica Limited gross margin is high this gross !ro&t is
only &fty &e !oint si( !ercent )44.7,of its sales turnoer. This is indicated by&gure * in the a!!endices# 'here it e(!lains that sales is si(ty four!ercent )7,
and gross !ro&t is thirty si( !ercent )37, gien a ratio of 8.?18# therefore for eery
one dollareighty cents )8.?+ of sales one dollar )8.++ goes to gross !ro&t. This is
a good sign since it 'ill yield agood net !ro&t margin as indicated by &gure 3 'here
the sales is eighty four !ercent )?, and net !ro&t issi(teen !ercent )87,#
sho'ing that there is a ratio of 4.818# therefore the com!any the com!any ma$es
onedollar !ro&t from eery &e dollar ten cents. The !ro&tability ratio com!ares the
!ro&t of the business 'ithsales# assets and ca!ital em!loyed. The gross !ro&t
margin is a good indicator of ho' e"ectiely managershae added alue to the cost
of goods sold. Current =atio ), K Current Assets ( #+3#73 ( 8++ K 7++.4,
Current Liabilities 7*#?3 88
8*. Li%uidity ratio assesses a business ability to !ay its short-term debts. Current
ratio# as a current ratiocom!ared to current assets 'ith current liabilities. Current
ratio of Courts is 718 and the com!any high currentratio suggests that the com!any
is able to !ay o" its creditors si( times. This is sho' in &gure 8 in thea!!endices
'here it indicates that of the total current assets and current liabilities# current
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assets total eightyfour !ercent )?7, 'hile current liabilities total fourteen !ercent
)8,. This is a good ratio because abusiness current asset should be at least t'o
times its current liabilities and the com!any ratio is 718. 8*
83. Courts Jamaica Limited is a !ublic listed com!any incor!orated and resides in
Jamaica. 5t is asubsidiary of Courts Furnishers );erseas Limited 'hich isincor!orated in 0ngland and 'hich holds .,of the com!anyEs issued stoc$ units.
The ultimate holding com!any is Courts /LC# 'hich is also incor!oratedin 0ngland.
The !rinci!al actiities of Courts Jamaica Limited consist of the retailing and the hire
!urchase&nancing of furniture and a!!liances. Hhen Courts started its o!erations#
furniture 'as being im!ortedho'eer this has changed. The change being referred
to is a s'itch in 874 to all locally manufacturedfurniture in the com!anyEs e"ort to
assist in the deelo!ment of the domestic furniture manufacturingindustry. 5t could
be concluded that Courts Jamaica Limited has arious sources of &nance and has
criteria forchoosing the source of funds. 5t could also be concluded that the
com!any follo' some of the majoraccounting conce!ts and a lot of di"erent grou!s
of !eo!le uses the com!any accounting information forarious reasons. Theresearcher 'ould li$e to recommend that the com!any continue to using the
accounting conce!tsitEs using no' and ado!t other !rinci!les 'as 'ell as
conentions. The recommends that Courts JamaicaLimited increase on the
aailability of internal sources of fund so has to reduce the cost associated
'ithborro'ing. 83
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8. . Hhat are the factors of !roduction em!loyed by the businessP
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