PROJECT REQUIREMENTS
The project requires two steps to be presented.
Step 1 – Identify Form and Substance Errors.
Step 2 – Compute the Purchase Point Media (PPMC) break-even points in terms of carts and stores.
In one Word document, provide individual sections for each Step. This Word document along with the Excel file (described below for Step 2) will be uploaded when you click on the Take Exam button on your Student Portal to submit your project (described under the “Submitting Your Assignment” later in the instructions).This Senior Capstone project highlights your knowledge and the skills you have developed over the course of your education. There is nothing “new” to be learned here
The knowledge and skills required for this project include English Composition, Financial Accounting, Managerial Accounting, Information Literacy and the abilities to think critically, do research and to present your work in a professional manner.
If you are unsure or don’t understand something about the project, then go back to your previous subjects to review. For example, if you don’t remember how to make a proper citation, then revisit your English Composition to see how to make a correct citation. Or, if you don’t remember how to calculate a break-even point, go back to Managerial Accounting and review the subject matter pertaining to that concept.
Remember, there is nothing “new” here. Everything about this project you should already know how to do.
Substance versus Form and Critical Thinking Step 1
In the infamous Enron bankruptcy case, the form of the financial statements prepared by the Enron Corporation and WorldCom was very professional; however, the substance was lacking, leading to audit and market failures and the eventual bankruptcy of both of these big-cap, or large-capitalization firms. PPMC represents a reverse case, in which the form of the data contained in the PPMC news release and corporate Web site was very poor.
To begin, read the PPMC report, focusing on problems with the form of the report. (“Form” means spelling, punctuation, and capitalization are correct and that the text is grammatically correct. Also, form means that the format of the text as far as font, bold, underlining, indents, and so on are correct.) Prepare a typed, clearly communicated summary of all errors or weaknesses you find in the form of this report. This should be a numbered list. There are well over 30 form errors in the document. (The ways to go about doing this for this step is to think of yourself as an English Composition instructor and a student has turned in a required paper that was written.) Although the PPMC report isn’t well-written, don’t attempt rewrite the report. Only present a numbered list of the errors found
To report the numbered list of form errors for this step, each error should have three components:
1.The location of the error.
2.What the error is.
3.How the text should have been written correctly.
Here is an example of how you’ll present the form errors
Summary of Errors in the Form of the PPMC Report
1.Location:
The first page of Exhibit 1, the last sentence of the first paragraph states “You should independently investigate and fully understand all risk before making investment decisions.”
Error:
The word risk is singular. It should be plural.
Correction:
It should have been written “You should independently investigate and fully understand all risks before making investment decisions.”
Next, reread the PPMC report, focusing on problems with the substance of the report. (“Substance” means the figures and data that are being reported and making sure the math is correct.) Identify the obvious errors or problems first by focusing on the addition or math errors. Prepare a typed, clearly communicated summary of all errors you find in the substance of this report. These should be presented in a numbered list.
To report the numbered list of substance errors for this step, each error should have three components the same as the presentation of the form errors:
1.The location of the error.
2.What the error is.
3.How the text should have been written correctly
The heading for the substance errors should be “Summary of Errors in the Substance of the PPMC Report”
Do not take this step lightly. The data and figures found in the report are used to calculate the beak-even analysis for Step 2. As presented, the data is incorrect and therefore, the break-even analysis would be incorrect. Therefore, it is important that you find “all” of the substance errors and correct them as these corrected figures will be what you use to make the break-even calculations for Step 2.
Step 2
The PPMC Notes in the document appear to be organized by cost behavior. This is similar to the approach you used in your Managerial Accounting course. You should follow this approach or framework as you compute the PPMC break-even point in terms of carts and stores. Begin with revenues, fol-low with variable costs (VCs), develop the contribution margin (CM; in aggregate), followed by fixed costs (FCs), and, finally, compute PPMC’s net operating income (NOI) and break-even point in terms of both carts and stores.
On your Student Portal, under the Supplements section of the Senior Capstone subject is a downloadable Excel file titled “Exam 500895- PPMC Excel Spreadsheet”
Step 2 requires that you calculate the break-even points for both carts and stores. Download this file and use it to calculate the breakeven points.
Reference the Excel spreadsheet for Step 2 in the Word document and include the spreadsheet as a separate file when submitting the project. The spreadsheet for the calculations is too large to include in a table in a Word document or be able to read if an Excel spreadsheet is inserted. Therefore, there should be two files submitted for the project – this Word document and the Excel spreadsheet with your work for Step 2.
The majority of the work has been done for you when using the spreadsheet. The setup to be able to calculate the CM, NOI and the break-even points are part of the spreadsheet. What you need to do to interpret the Notes from the PPMC document, input the data into the spreadsheet (be sure to use your “corrected substance” figures/data from Step 1), and do the calculations required to obtain the break-even point for the carts and the break-even point for the stores. (Hint: Some cells in the spreadsheet have comments inserted. Pay attention to these comments. For example, there is a comment in a cell that has the formula to be used to calculate the break-even point.)
