Cost control and performance measurement of institutions involved in development of youth welfare

Document Type:Research Paper

Subject Area:Accounting

Document 1

Dr. Thomas Grüber Second Supervisor: Prof. Dr. Michael Faustino Bauer Date of Submission (02. Words: 15000 - 16000 DECLARATION FORM I, Aryob Zazai, Matrikel # 395896, IBMAN student in Berlin school of economics and law, do hereby declare that the report titled: “Cost control and performance measurement of institutions involved in the development of youth welfare (A case study: ALEP e. V. ” Is submitted by me in partial fulfillment of bachelor’s degree, is my own effort and has not been submitted or published earlier. I also declare that I will not in future submit it for graduation purpose either from this or any other institution or university. With my signature, I confirm that: • I have committed none of the forms of plagiarism described in the “citation etiquette” information sheet. • I have documented all methods, data and processes truthfully. • I have not manipulated any data. • I have mentioned all persons who were significant facilitators of the work. Signature: ____________________ Name: Aryob Zazai LIST OF ABBREVIATIONS AGJ – Arbeitsgemeinschaft für Kinder und Jugendhilfe ALEP – Außerschulisches Lernen und Erlebnispädagogik CE – Capital employed EBIT – Earning before interest and taxes EU - European Union EVA – Economic Value added ROA – Return on assets NGO – Non-governmental organization ROCE – Return on capital employed ROE – Return on equity ROI – Return on Investment SC – Service Cost TFC – Total Fixed Cost VC – Variable Cost WACC – Weighted average cost of capital X – Number of quantities SGB – Sozialgesetzbuch CM – Contributional Margin DM – Direct Material DL – Direct Labor OH – Overhead CR – Current ratio QR – Quick ratio WC – Working Capital NWC – Net Working Capital KPI – Key Performance Indicator NI – Net Income Contents DECLARATION FORM 2 LIST OF ABBREVIATIONS 3 1.

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INTRODUCTION 6 1. Introduction 6 1. Background of the Study 8 1. Alep e. V in Germany 9 1. Research Questions 9 1. Aims and Objectives 9 2. LITERATURE REVIEW 15 3. Introduction 15 3. Theoretical Review 15 3. Resource Based View Theory (RBV) 15 3. Efficiency Structure Theory (ES) 16 3. Questionnaire Design 21 4. Research Limitations 22 4. Data Collection 22 4. Reliability and Validity of the Research Instruments 23 4. Validity 23 4. Recommendation policy and practice 38 6. Limitations of this Research 39 6. Suggestions for Further Research 39 BIBLIOGRAPHY 40 APPDIX I: INTRODUCTION LETTER 42 APPENDIX II: FINANCIAL ANALYSIS FORMULAE 43 APPENDIX III: BALANCE SHEET 44 APPENDIX IV: INCOME STATEMENT 45 APPENDIX V: CASH FLOW STATEMENT 46 1. INTRODUCTION 1. Introduction From the past years, it is evident on how much the European Union (EU) affects both directly and indirectly the living situations of children, youth, and their families as well as the child and youth welfare system in Germany through its social and political fields of work. Humanity caring is the main goal of this institution and that is why it is offering different services such as outpatient aids, assisting in building youth homes which raises the living standards of needy people like refugees and renovating homes for retired citizens.

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The institution is also leading in the provision of educational projects; school related social work, learning support within the framework, adapting group meetings for young people, providing houses with services and helping young generations with daily life issues such as cooking, shopping and sport activities. The main targeted group is unaccompanied underage children, refugees and asylum seekers individual or families. For the children and teenagers who have problems while living with their families, Alep e. V. These children have support from the development plan totally. The family life aspects are preserved; appropriate life forms are progressed especially in an educational assistance framework. Families along with their children get supportive aids with different goals such as the empowerment of the family, support for everyday problems, the improvement of supply conditions and stabilization of the psychosocial condition.

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These aids have been provided through ambulatory helping team (family therapeutics, psychologists and additional educational members). The ambulatory specialists work in families with diverse cultural efficiencies and effectiveness in the Alep’s Houses. has the goal of further developing structures and action concepts of facilities as required. This research paper aims to investigate the effects of cost control on the financial performance of Non-Governmental Organizations, my case study being “ALEP e. V. ” which is one of the leading NGOs for children, youth and family welfare development in Germany. Alep e. I am also interested in finance field and wanted to know how managerial accounting works in a real life like how management reports provide accurate and timely financial and statistical information. This paper will be divided into six chapters namely: introduction, Cost management/financial performance, literature review, research methods/data analysis, results/discussion and finally summary, conclusion and recommendations chapter.

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Chapter one is introduction and it gives an overview of the history of cost control is given and a brief introduction the Organization under study. Chapter two is Cost management/Financial performance which gives the various strategies for cost control and the impact they have on financial performance. Chapter three is literature review where various studies that have been done concerning cost control will be discussed in detail. Cost control can also be an integral feature in the overall management effectiveness of a business and can help in the determination of estimated costs before starting of processes and help in forecasting future cost occurrence. This can in turn make the business spend limited allocated resources effectively and will also lead to lower costs per unit, better quality of products and processes and a reduced working capital (Groth and Kinney, 1994).

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Organizations that have implemented cost control strategies are able to know which cost amount will be incurred in the future because they already have information about the current and future costs. This in turn helps managers to make better decisions that will in the end improve positively the financial performance of NGOs. Alep e. is to pursue exclusive and direct charity and serve the upcoming generation for the country. ALEP eV is politically and denominationally independent and pursues exclusively and directly charitable or benevolent purposes. ALEP eV has the goal to further develop structures and action concepts of facilities according to demand. ALEP eV is recognized as a non-profit and is entitled to issue tax-deductible donation receipts. Most of the employees are with multi-cultural background along with speaking 3 or 4 languages, because many of the minor refugees cannot speak German or English.

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This paper work includes information to identify areas for improvement through efficiency and effectiveness of individual, group, organization and a system. There is accurate financial management information, which will lead non-profit organizations managers to better decision making and achieve its goals. In order to collect, analyze and report cost information, different ratio systems and methods are being used. This will help us to decrease service costs and increase service revenues of the organizations. Young people residing in youth welfare institutions improved individually and achieved social goals with regard to change of behavior problems. This term paper provides some specific direction for ALEP e. V. to improve their performances and give success to the institution. The whole research paper deals with the cost control and performance measurement of institutions involved in the development of youth welfare in Germany, as youths are considered as essejnkntial future generation for the country.

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Cost Management / Financial Performance management 2. Measures of financial performance serve three main purposes, which are: they are used as a mechanism for control and motivation in an organization, they are a tool used for financial management and lastly, they are at most times the main business objectives in any organization. Various researchers have used different measures of financial performance in the past and the most common performance measure in organizations found in the western countries is profitability (Doyle, 1994). Types of Costs 2. Direct cost In Alep e. V, houses’ rent, supervisor wages and house materials and equipment are counted as direct costs. The finance officers, HR recruiting team, procurement officers and supervision analysts’ wages and salaries are considered as Indirect cost in this organization. Effects of Cost Control Strategies on Financial Performance There is a big correlation between cost control and management strategies and the financial performance of business organizations.

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This correlation can be either in a positive way or in a negative way. Approaching this relationship from the positive side, cost control and management strategies are factors of great importance that can lead to increase revenue collection of an organization such as a Non-Governmental Organization. Also, techniques such as sourcing and budgeting system and standard costing that are meant to contain costs usually bring a limit to the highest cost that would be incurred and this in turn leads to lower expenses and incomes that are at the same level and this leads to an increase in profitability. Research tools such as one to one interviews, telephone and face-to-face questionnaire surveys took place with the management and finance team of ALEP e. V. One to one interviews include structured and semi-structured interviews and the questionnaire surveys include specific information request, category types, scaling, grids or tables and open questions from the interviewers.

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The survey method will lead the paper with specific information, which will illustrate the specific questions from the interviewers. In category type, there will be questions, which would be answered with Yes, No, and Never. V NGO in German but the study and data collection will include both upper and lower management employees. The population that has been targeted is twenty employees of that NGO. This study will also adopt a research based or survey or questionnaire design where all the respondents will be actively involved. Value of this Research This research will be a source of knowledge in management accounting especially in the management of costs of labor, sales and distribution costs and finally inventory costs. This study will contribute positively to the executive management of a business as it elaborates the relationship between the financial performance of an organization and the various cost control strategies.

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Resource Based View Theory (RBV) Robinson (2011) and Pearce 11 define RBV as a method of analyzing and identifying an organization’s strategic advantages. This is normally based on examining the organization’s distinct combination of skills, capabilities, assets and intangibles. This theory usually views the organization-specific factors and the effect they have on performance. Grant,1991), Views a firm as a bundle of resources that are combined to create organizational capabilities which the firm can put into use to earn profits that are above average. Firms usually develop their competencies from such resources and when the resources are well developed, they become the firm’s source of competitive advantage. The theory uses two approaches that are very distinct and they include the scale-efficiency and the X-efficiency hypothesis. The scale-efficiency focusses on economies of scale rather than differences in technology or management.

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It therefore implies that larger firms can usually get unit costs that are lower and in turn reap high profits through the economies of scale. This in turn helps large firms to acquire a huge market share, which sometimes manifests itself in higher concentration and then finally profitability. On the other hand, the X-efficiency approach says that the more a firm is efficient, the more profitable the firm is as it has lower costs. Some of the indicators of the three mentioned dimensions are sales growth, returns on investment and new product success respectively. Morgan (2012) also suggests that performance of a business consists of two main aspects namely financial performance and market performance. The latter normally relates to behaviors of customers and its some of its indicators include increased customer satisfaction, higher volume of sales, growth in market shares and customer loyalty.

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On the other hand, financial performance is usually measured using accounting terms. This research will define the performance of a firm as a financial performance and goal achievement, which are normally indicated by the amount of sales, better return on investment, net income goal achievement and increased market share. ROA is a measure of returns to all assets and is mostly used as an overall profitability index. The higher the ROA value, the more profitable a business or firm is. ROE is a measure of the rate of return on the owner’s equity that has been employed in the business. It is of importance to consider ROE in relation to ROA so as to determine whether the firm or business is making profitable returns on their borrowed money. Operating profit margin on the other hand measures the returns to capital per unit of gross revenue.

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Reasons such as effects of the potential learning curve and Kaizen costing can lead to reduction in cost gradually and in the end reduce the expenses. Based on these reasons, the organization or business can go ahead with service provided in as much as the cost targeted is way below the attainable cost that is currently estimated to be achieved. Such costs cannot be implemented without having an approach that is systematic to cost reduction. The German Youth and Child Welfare Policy The German youth and child (welfare) policy is anchored legally in Volume VIII of the German Social Code (SGB VIII). It is based on traditions of professional social pedagogic in youth welfare, and the federal state, the German states and municipalities is responsible for it. Afterwards the children relax in the rooms or in the gardens.

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The homework assignment is an important part of children; in which they get support by hired promoted educators. Various leisure activities in the week and holidays are been done which bring joy, movement, fun and motivation to the children. In Addition, the European Union (EU) countries illustrated a clear humanitarian proof to provide better life situations and high standards to the children, youth and families locally and from abroad. From the European Union countries, mostly Germany put a great consideration to child and youth development environment and welfare. It will provide details for the research plan used, research design, questionnaire design, research limitations, data collection and data analysis techniques used in this study. Research Plan This research will be an empirical study and so I will use a scientific approach to help me come up with a design of the research methodology for investigation.

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I will also use secondary data sources such as websites, annual reports and other publications as my sources of information. I will also use accounting techniques such as ratio analysis for data analysis. Ratio analysis is a process whereby one figure is compared against another which makes up a ratio. The focus of the study was qualitative and quantitative through questionnaires, interviews and secondary data in order to gain a better understanding and more insightful interpretation of the result. This approach is preferred because it meets conditions of objectivity, reliability and validity. Quantitative approach will enable me develop research questions and is also the appropriate method to be used for the kind of numerical data that will be required in this study (Schweitzer, 2009). Creswell (2009) says that the quantitative approach is the most appropriate for doing analysis of numerical data.

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This research will also use causal research design, multi variant linear regression model to be precise. Different questions were asked from each individual in order to achieve his or her view point, goals and objectives within the organization and what is he or she trying to get during his working period. The interviews had been done individual as they were at different management and financial levels and also daily working life problems. The questionnaire contains five sections to evaluate the answers. Content of questionnaire: (a) The first section of questionnaire holds common information about company such as size, location and type of the company. b) The second section of questionnaire contains company’s characteristics such as experience and changes in amount. Data Collection I did data sourcing from both secondary and primary sources such as audited financial statements so as to enable me to do computations of all the relevant ratios and questionnaire.

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A questionnaire survey was used for data collection from the organization I had chosen to be my case study. The type of questionnaire design I chose is called structured questionnaire. I chose use of questionnaire as a means of data collection because it is easier to administer, analyze and it is very cost-effective in terms of money and time. In terms of definition, a questionnaire is a kind of manuscript with a number of questions that have been typed or printed in an order that is explicit in nature (Kothari, 2004). The data from these statements will be used to calculate financial ratios like profitability ratios, solvency ratios and liquidity ratios. Reliability and Validity of the Research Instruments 4. Validity A test’s validity is a measure of how well the test measures whatever it is supposed to measure.

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To ensure that the instruments of research are valid, I consulted my supervisor so as to help me examine well the research instrument’s content and indicated the degree to which this instrument can gather the information that was intended. I also used peer review so as to enhance face to face interaction and also the validity of the content that was collected. Data Processing and Analysis Data analysis refers to a mechanism that is used to reduce and organize data collected from various sources so as to deduce findings which normally require the researcher’s interpretation (Burns and Grove, 2003). Data processing on the hand refers to the process of translation of the answers that have been given by respondents of questionnaires into an easy form, which can be manipulated and analyzed to produce the required statistics.

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The quantitative data obtained used questionnaires is prepared in readiness for analysis e. g. through handling blank responses, editing, categorizing, coding etc. The main agenda for an organization to do target costing is to enable its management be able to apply cost planning methods that are proactive in nature, do effective cost reduction and cost management in that costs will be calculated earlier in the design and development phase of a product instead of waiting till late stages of a product’s production and development cycle (Anon, 2018). Target costing has number of features such as the inclusion of the minimum profit margin that is required in the targeted selling price. Also, a product’s price is normally determined by market conditions and this makes that particular business to be a price taker rather than being a price maker.

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It focusses majorly on effective cost management and reducing costs and it is part of the strategies that management of a business uses. In target costing, the design and specifications of a product and the expectations of clients are built already in the process of formulation of the selling price. By adding both and dividing, both by two “2” will give us an average return on service provided, which would be 42, 12 % average for the year 2016 and 2017. Activities / Components Actual costs (2017) Percentage % Target cost (Estimation) Percentage % “000,000” “000,000” Fund Raising Costs 9, 4 2, 98 % 8, 8 3, 07 % Development Cost 67, 6 21, 46 % 63, 5 22, 12 % Children youth and families cost 18, 2 5, 78 % 12, 6 4, 40 % Staff Wages 21, 8 6, 92 % 15, 4 5, 36 % Commercial activities costs 133, 5 42, 38 % 120, 5 42, 00 % Non-Monetary cost 6, 5 2, 06 % 9, 2 3, 20 % Service and administration costs 49, 1 15, 60 % 44, 5 15, 50 % Other Costs 8, 9 2, 82 % 12, 5 4, 35 % Total Costs 315000000 100 % 287000000 100 % Reducing the extra waste cost from the activities will give profit and comparison between actual costs and target cost would be total cost gaps.

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Actual costs – Target costs = Total cost gaps (315000000 – 287000000 = 28000000) As I have determined that, this organization has some extra cost in different activities such as Fund raising costs, development cost, children, youth and families cost and mostly big differences in staff wages. The staff wages have decreased and we have reduced the costs of staff because many staffs were doing nothing and getting salaries in the organization. The commercial activities cost has been also decreased from actual cost because it has unnecessary cost which has to be reduced. The liquidity level needed usually varies from one organization or industry to another. They are normally used to pay a company’s short-term debts and there are three common calculations that take place in liquidity ratios, which are current ratio, quick ratio and working capital.

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Current ratio = current assets / current liabilities This ratio is used to measure an organization’s current assets against the organization’s current liabilities. It shows whether the organization is able or not able to pay off its short term liabilities by liquation of its current assets in case of an emergency. The current ratios for 2016 and 2017 are: 2016: 118 / 101 = 1, 168 2017: 146 / 125 = 1, 168 Quick ratio = Cash + Cash equivalent + Short term investment + Current Receivable / Current Liabilities It is more stringent than the current ratio and it compares accounts receivable, cash and marketable securities that are short term in nature. It is useful analysis for manager in order to make short-term economic decisions. This analysis includes several equations using price, cost and other variables and showing them on an economic graph. Formula CVP = SC (X) – VC (X) – TFC = Profit SC = Service Cost VC = Variable Cost TFC = Total Fixed Cost X = Number of quantities (1) Contribution Margin: When you deliver a service and deduct the variable cost of that Service, the left over is the contribution margin.

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Service Revenues 477 518 550 • Variable Service Cost 189 188 180 = Contribution Margin 288 430 470 • Fixed Service Cost 98 115 135 = Total Profit 190 215 235 (2) Contribution margin Ratio: When we have a contribution margin and we divide it by total service revenues gives us the result of contribution margin ratio. Contribution margin ratio = contribution margin / total service revenues17 2015 2016 2017 Contribution margin ratios 0, 6037 0, 8301 0, 8545 (3) Break-even point: It is the point where no profit and no loss are made in the company. It is the gap between ask prices and bid of stock or any other security. Spread for 2016 and 2017 is: 2016: 95, 98 % – 7, 74 % = 88, 24 % 2017: 105, 85 % – 7, 77 % = 98, 08 % (6) Economic Value Added: (EBIT – Capital Employed x Weighted Average Cost of Capital) This is a measure of the financial performance of an organization based on the organization’s residual wealth. EVA for 2016 and 2017 is: 2016: 215 – (224 x 0, 0774) = 197, 66 2017: 235 – (222 x 0, 0777) = 217, 75 (7) Delta Economic Value Added: (2017 year – 2016 year) Delta EVA = 217, 75 – 197, 66 = 20, 09 5. RESULTS/DISCUSSION 5. Results Calculations of various ratios were done to determine the financial stability of ALEP e.

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On the other hand, the NGO’s return on equity (ROE) for 2016 stood at 0,9034 while that of 2017 rose up to 0, 9476. Another computation that was done was CVP analysis, which enables managers to make short-term economic decisions. Service revenue for 2016 was 518 while that of 2017 was 550. The contribution margin for 2016 was 430 while that of 2017 was 470. Total profits for the year ended 2016 was 215 while total profits for the year ended 2017 rose up to 235. I also found out that the working capital for this organization in the year ended 2016 was $17, 000,000 while its working capital in the year ended 2017 rose up to $21,000,000. The organization’s EBIT for the year 2016 was 215 as compared to 2017 where it rose up to 235. Capital employed in 2016 was 224 as compared to 2017 where it decreased to 222. Return on capital employed in 2016 was at 95, 9 % as compared to 2017 where the return on capital employed rose up to 105, 85 %.

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Weighted Average Cost of Capital in 2016 stood at 7, 74 % as compared to the year 2017 where it rose by a margin of 0, 03 % to 7, 77 %. On the other hand, the NGO’s ability to cover its current liabilities rose up to 111, 2 %, which is an improvement. Financial stability ratios are also called solvency ratios and they are a measure of the NGO’s ability to meet its obligations that are long-term in nature (Lan, 2018). Therefore, the analysis of the solvency ratios provided an insight on the NGO’s capital structure and also the level of financial leverage that the NGO is using. The two ratios that were calculated are debt ratio and equity ratio. Debt ratio measures the percentage of the NGO’s total assets that are financed by debt. In general, these high equity ratios are favourable to the NGO for several reasons.

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First, high levels of investment by shareholders will show potential shareholders in the NGO that the NGO is worth investing in since many investors are willing to finance the NGO. Secondly, the high ratios in both 2016 and 2017 show potential creditors that the NGO is less risky and more sustainable to lend future loans (Lan, 2018). Two profitability ratios were calculated namely Return on assets (ROA) and return on equity (ROE). Return on asset (ROA) enabled me to measure how efficient the NGO utilizes its assets. This is evident from the working capital figures of those two years whereby in 2016, the organization’s working capital was $17,000,000 as compared to 2017 where its working capital was $21,000,000. SUMMARY, CONCLUSION AND RECOMMENDATIONS 6. Introduction This chapter will give a summary, a conclusion and a set of recommendations based on the findings from this research.

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It will also give a highlight of the research’s limitations and give suggestions on areas where further studies can be done. Summary This main agenda for carrying out this research was to investigate the various cost control and management strategies that are applied by Non-Governmental Organizations, my case study being ALEP e. that is found in Germany. Finally, the results were tabulated and in-depth discussions done so as to give an accounting perspective of those figures in relation to the financial performance of this Non-Governmental Organization. Various determinants of financial performance for this NGO were discussed in depth and the various types of costs that this NGO incurs in its day-to-day activities. This research will be of great importance to other interested researchers of the impact of cost control on the financial performance of various business organizations.

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Conclusion Many organizations and businesses especially Non-Governmental Organizations usually face challenges pertaining to cost control in their day-to-day activities. V, which is an NGO found in Germany that deals with youth welfare agenda. Indeed, I did find out that there is a strong relationship between cost control and the financial performance of ALEP e. V. This conclusion was reached at after a careful data collection and preparation of the NGO’s financial statements for the year ended 2016 and 2017. The financial statement that helped me reach this conclusion are the balance sheet, income statement and finally the cash flow statement. Suggestions for Further Research This study concentrated only in an NGO in Germany. My recommendation is that other research work should be done to cover other NGOs in Germany and the entire world.

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These organizations should not only be dealing with youth affairs but other agendas like poverty, hunger, fear, education and eradication say in developing countries. I also recommend that this research be replicated to other institutions like the banking sector, insurance sector and energy sector and it should be done across the entire world so far to gather diverse data for comparison purposes. BIBLIOGRAPHY Alep-ev. de/index-Dateien/pdfs/bjw_wuhlheide. pdf {Accessed 4 Feb. Smallbusiness. chron. com. thebalance. com/contribution-margin-ratio-393478 {Accessed 5 Feb. Kleinrahm, R. Keller, F. Lutz, K. Paul: MN West Publishing company. Grant, R. M. The resource- based theory of competitive advantage: Implication for strategy formulation. California Management Review, 33, 114-135. Robinson, R. B. Strategic management: Formulating, implementation and control. th ed. New York: McGraw Hill/ Irwin. Creswell, J. W. Research design: Qualitative, quantitative and mixed methods Approaches (3rd ed).

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Thousand Oaks, CA: SAGE publications. Lintaner, J (1941). and Kinnery, Michael R (1994). Cost Management and value creation. Management decision. Zengin, Yasemin and Ada, Erhan. Cost Management through product design: Target costing approach. Understanding Nursing Research. rded. Philadelphia: W. B. Saunders Company Bragg, S. com/managerial/cvp-analysis/target-costing {Accessed 26. Feb. Study. com. Liquidity Ratio: Definition, Calculation & Analysis – Video & Lesson Transcript {Online} Available at: https://study. Your cooperation and genuine responses will be highly appreciated. Yours Faithfully, Aryob Zazai Matrikel: 395896 APPENDIX II: FINANCIAL ANALYSIS FORMULAE (a) Liquidity ratios: 1: Current ratio = current assets / current liabilities 2: Quick ratio = Cash + Cash equivalent + Short term investment + Current Receivable / Current Liabilities 3: Working capital = Current Assets – Current Liabilities (b) Financial stability ratios: 1: Debt ratio = Total debts / total assets 2: Equity ratio = Total equity / total assets (c) Profitability ratios: 1: Return on Assets = Net income / total assets 2: Return on Equity = Net income / shareholder’s equity (d) CVP Analysis: (Formula) CVP = SC (X) – VC (X) – TFC = Profit SC = Service Cost, VC = Variable Cost, TFC = Total Fixed Cost, X = No # of quantities (e) Contribution margin: (Service revenues – Variable cost) (f) Contribution margin ratio: (Service revenues – Variable cost) (Service revenues) (g) Break-even point: (Service cost – Variable cost – total fixed cost = 0) (h) EBIT: (Service revenues – Total cost) (I) Capital Employed: (Non-current asset + Working capital) (j) Return on Capital Employed: (EBIT / Capital Employed) (100) (k) Weighted Average Capital Cost: {(Equity / debt + equity) (I) + (debt / debt + equity) (I) x (1-t)} (l) Spread: (Return on capital employed – weighted average cost of capital) (m) Economic Value Added: (EBIT – capital employed x Weighted Average Cost of Capital) (n) Target cost: This determines the allowable cost and then comparing the allowable cost with actual cost, finding out the cost gaps “cost differences”, and then structuring them according to the function and at the end, we know where to make investments and where need significant savings.

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APPENDIX III: BALANCE SHEET Balance Sheet of Alep e. V. for the year 2016 and 2017 2016 2017 ASSETS “000,000” “000,000” Current Assets Cash or cash equivalent 70 96 Short term investments 26, 4 27, 4 Account receivables 15, 6 15, 6 Prepaid rent 6 7 Total Current Assets 118 146 Property, Plant and Equipment Land and Building 127, 3 127, 3 Machinery and Equipment 98, 7 102, 7 Total 226 230 Less Accumulated Depreciation (19) (29) Total Property, Plant and Equipment 207 201 Long term investment 142, 9 152, 6 Other assets 44, 1 46, 4+ TOTAL ASSETS 512 546 LIABILITIES Current Liabilities Note payable 7, 8 9, 2 Account payable 23, 2 28, 8 Accrued payable 17 21 Accrued Wages 35 48 Taxes payable 18 18 Total Current Liabilities 101 125 DEBTS “Long term” 173 173 Owner’s equity 238 248 Total owner’s equity 411 421 TOTAL LIABILITIES AND O.

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