7.2 Assessing the Internal Position of a Business
AJS plc
AJS plc is a manufacturer of non-recyclable packaging. This packaging is widely used by takeaway food outlets. AJS plc plans to invest £500 000 in new technology to increase capacity and make its factory more capital intensive.
Appendix A Data on proposed investment (produced by AJS plc’s operations manager)
Year | Annual net cash flow | Discount factor |
0 | (500) | 1.00 |
1 | (50) | 0.91 |
2 | 250 | 0.83 |
3 | 600 | 0.75 |
Appendix B UK market for non-recyclable takeaway food packaging
Appendix C UK market for recyclable takeaway food packaging
Appendix D Selected Human Resource data 2022
AJS plc | Industry average | |
Average salary | £22 000 | £26 000 |
Salary costs as a percentage of turnover (%) | 40 | 35 |
Labour turnover (%) | 15 | 4 |
Working days lost through industrial action | 24 | 5 |
Average number of applicants for vacancies | 14 | 55 |
Appendix E Selected Financial data for AJS plc
2022 | |
Current assets | £550 000 |
Current liabilities | £550 000 |
Non-current liabilities | £4m |
Operating profit | £3m |
Gearing | 22% |
Change in the share price of AJS plc over the year | –15% |
Change in the share price of the top 100 UK companies over the year | +8% |
Using Appendix E, calculate the Return on Capital Employed for AJS plc in 2022.
Ai এর মাধ্যমে
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