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Question One

Keri Tahu owns Waikiekie Electrical, a shop in Waikiekie selling large electrical appliances such as washing machines, refrigerators, TVs and stereos.

1. State two people who would be interested in the financial statements prepared for Waikiekie Electrical for the year ended 31 March 2002. Explain a reason for their interest.
Answer
For example:
• Bank Manager from ANZ - for lending purposes to ensure that Keri is able to meet ongoing interest payments/debt servicing.
• Auditor from IRD - to check that the correct amount of tax has been paid by Keri.
2. Westside Chartered Accountants prepares the financial statements of Waikiekie Electrical. State two other services that Westside Chartered Accountants is likely to provide for Waikiekie Electrical.
Answer
Budgeting advice / cash flow projections / GST returns / PAYE returns / etc (two required)

Question Two

Melinda Burgess owns Kit Your Kitchen, which sells kitchen accessories for cash and on credit. The following financial information relates to the performance of Kit Your Kitchen over the past two years.

The table below contains Kit Your Kitchen's Statements of Financial Performance for two years. Complete the gaps in the 2002 Statement of Financial Performance and then calculate the percentage change for Sales and the percentage change for Net Profit.

Kit Your Kitchen
Statement of Financial Performance for the year ended 31 March 2002

	2001 $	2002 $	Percentage Change from 2001 to 2002
Sales	100 000	120 000	%
Cost of Goods Sold	60 000	64 000
Gross Profit	40 000
Selling Expenses	10 000	15 000
Administration Expenses	8 000
Financial Expenses	6 000	11 000
Net Profit	16 000	18 000	%

Answer