All of the learning outcomes for the module are being assessed in this assignment. The learning outcomes are shown in the section entitled “Marking Guide”, which is further on in this document.
The University’s policy on cheating collusion and plagiarism will be applied to this piece of work.
You are required to produce a report which answers the following TWO questions: Question 1
XYZ Limited is a medium sized manufacturing business which makes and sells products to a range of industrial customers who use XYZ’s products in their own products. The working capital of XYZ is typical of a manufacturing organisation in that at any point in time they have cash, trade receivables, inventories of raw materials, work in progress and finished goods and trade payables. The Managing Director of XYZ Limited believes that all parts of the working capital cycle could be improved and has asked you to produce a report which discusses how each part of the working capital cycle could be improved and which critically evaluates the implications of the improvements on XYZ and other connected parties (for example trade receivables and trade payables).
1
Question 2
Many organisations use transfer pricing when transferring products between different divisions of the same organisation. You are required to discuss in detail the advantages and disadvantages of each of the following four methods:
1) Market based transfer prices;
2) Full cost transfer prices;
3) Cost-plus a mark-up transfer prices; and
4) Negotiated transfer prices.