FIN242 Role Play Group Assignment
FIN242 Role Play Group Assignment
BA111
FUNDAMENTALS OF FINANCE
FIN242
PREPARED BY:
NAME STUDENT ID
NURUL AIN BINTI SUKOR 2022628154
MUHAMMAD ADIB BIN AHMAD RAMLI 2022854446
LUQMANUL HAQEEM BIN AWANG EFIZAN 2022460686
ABDULLAH FAHIM ZAKWAN BIN ZUWISLAN 2022833662
WAN DANIEL DZULKARNAIN BIN WAN AHMAD KAMAL 2022834082
GROUP: BA1113A
PREPARED FOR:
MISS SITI SYAMIRA BINTI MOHD RAMLI
1
TABLE OF CONTENT
NO CONTENT PAGE
ACKNOWLEDGEMENT 3
3.0 ISSUES & PURPOSE OF SHORT – TERM FINANCING FOR BUSINESS 6-7
6.0 CONCLUSION 12
7.0 REFERENCES 13
8.0 APPENDIX 14
2
ACKNOWLEDGEMENT
Bismillahirrahmanirrahim. First and foremost, we are grateful to Allah SWT, our God
for granting us the ability to work on and finish the FIN242 group assignment.
Next, we would like to express our heartfelt gratitude to Miss Siti Syamira Binti
Mohd Ramli, our great professor, for all of her assistance and advice with this project. She
has given us ideas, expertise, and pointers on how to complete this assignment.
We would like to publicly thank Miss Siti Syamira Binti Mohd Ramli for her
outstanding leadership, steadfast support, and encouragement over the duration of this
initiative. Her willingness to share her enormous experience, provide invaluable ideas, and
provide constructive criticism has been critical in boosting the depth and quality of this
undertaking.
Having her as a mentor has also helped my research and expanded my understanding
of the subject. We owe a great deal to Miss Siti Syamira Binti Mohd Ramli for her
compassion, tolerance, and unwavering trust in her pupils' potential. Her words of wisdom
have motivated me to strive high and face challenges with confidence, functioning as a
beacon of light.
Furthermore, we would like to thank both of our parents for their good wishes and
supportive thoughts. They have provided us with all the materials we require to complete this
report properly.
Despite the numerous problems we had during this operation, we were able to
overcome them and learn from our mistakes. We'd like to thank everyone who contributed to
the report's creation, whether directly or indirectly.
3
1.0 COMPANY BACKGROUND
Tony Fernandes launched the low-cost airline AirAsia in Malaysia in 1993. At first, the
airline faced a lot of debt and was in danger of going bankrupt. Nonetheless, Tony Fernandes
and his partners successfully acquired the airline for an insufficient sum of one Malaysian
ringgit in December 2001 and took on its outstanding debts through their business Tune Air
Sdn Bhd.
Under the new management, AirAsia experienced a dramatic change. Tony Fernandes, a
former executive in the music business, introduced his unique style to the airline industry. In
order to keep fares reasonable, the airline took the low-cost airline model, concentrating on
direct flights, cost effectiveness, and basic amenities. This tactic aimed to increase the
number of people who could afford to travel by air. Other than that, the new name and
business model change of AirAsia were successful. The airline experienced fast growth and
grew to popularity as one of Asia's top low-cost carriers. It became well-known for its
affordable prices, effective business practices, and innovative marketing approaches.
Lastly, it's a good idea to check the most recent sources for the most up-to-date information
on AirAsia, as developments might have happened after my previous update in January 2022.
4
2.0 ROLES & RESPONSIBILITIES OF EACH GROUP MEMBERS
5
3.0 ISSUES & PURPOSE OF SHORT – TERM FINANCING FOR BUSINESS
ISSUES: Company want to borrow a certain amount of money to one of the financial
institutions.
PURPOSE: Company need to have additional funds to cover a cost of buying aeroplane
maintenance machine for the purpose of keep the planes in good condition.
Current Asset−Inventory
Quick Ratio:
Current Liability
434,017,000−9,190,000 387,960,000−0
2022: 2021:
771,265,000 34,530,193,000
The firm has greater liquidity to pay their short-term debt in 2022 compared to 2021.
Current Asset
Current Ratio:
Current Liability
434,017,000 387,960,000
2022: 2021:
771,265,000 34,530,193,000
The firm has greater liquidity to pay their short-term debt in 2022 compared to 2021.
Sales
Inventory Turnover:
Inventory
6
176,373,000 68,349,000
2022: 2021:
9,190,000 0
The firm has greater sales using its inventories in 2022 compared to 2021.
INTERPRETATION
The company quick ratio shows a good performance in their ability to pay short term
debt.
The company current ratio shows a good performance in their ability to claim of their
short-term creditor.
The company inventory turnover shows a good performance in their ability to
generate sales using its inventory.
7
4.0 EVALUATION OF EACH SHORT – TERM FINANCING AVAILABLE
To support the company’s additional funds needed for the aeroplane maintenance machine,
there are some available alternatives that must be considered before choosing the best one.
This could be proven based on the calculations below:
1. SHORT-TERM FINANCING
Company needs to raise RM750,000 in short term loan for five months. The company has the
following alternatives to choose from:
ALTERNATIVE 1 (TRADE CREDIT)
Forego trade credit with the credit terms of 3/15, net 60.
a 360
COA = × ×100
1−a c−b
0.03 360
= × ×100
1−0.03 60−15
EIR = 24.74%
ALTERNATIVE 2 (REVOLVING CREDIT)
A line of credit of RM950,000 with 5% commitment fee on the unused fund, and 8% stated
interest rate.
Unused Balance = RM950,000 – RM750,000
= RM200,000
EIR = ( 25000+10000
750000 ) 12
× × 100
5
= 11.20%
8
ALTERNATIVE 3 (COMMERCIAL PAPER)
Issue commercial paper with a face value of RM150,000 each at 15% per annum. The
issuing cost is RM4,000 per paper. (1 year = 360 days)
750000
Number Of Papers =
150000
= 5 papers
5
Interest = RM 750,000 x 0.15 x
12
= RM46,875
EIR = ( 750000−46875−20000
46875
) x 150
360
x 100
= 16.47%
5
Interest = RM 750,000 x 0.07 x
12
= RM21,875
9
EIR = ( 663125
21875
) x 125 x 100
= 7.92%
Thus, alternative 4 is the best option due to the lowest effective interest rate.
5.0 DISCUSSION AND RECOMMENDATION
Cost
Bank loans sometimes come with a charge, which is usually interest on the total amount
owed. Other expenses and fees may apply depending on the lender and the kind of loan.
Aside from that, there are arrangement costs that must be paid to the lender for the cash to be
held and initial expenditures to be paid. The fees will be determined by the complexity, size,
and risk of the firm. Aside from that, interest rates apply and are subject to fluctuate based on
default risk. The most common types are fixed and variable interest rates.
Term
The loan term is how long the borrower must pay back the loan. The loan payments are the
total amount of money that needs to be prepaid each week or month to fulfil the loan’s
requirements. An amortization table can be used to calculate this based on principal, loan
period, and interest rate. Furthermore, the lender must pay extra costs such origination
servicing, or late payment fees.
Flexibility
Borrowers with flexibility loans can take out excess cash or make extra payments on their
existing mortgage without having to go through long approval processes. The house loan
itself is connected to the borrower's current bank account under this loan arrangement. The
scheduled loan amount is automatically taken from the current account each month according
to the pre-approved timetable. If the borrower pays the agreed-upon minimum loan
instalments, they can deposit or withdraw any excess funds. For example, if you put extra
money into your account for a few months, the interest on your house loan will be cut right
away.
2.0
10
Risk Tolerance
A bank loan is a common and often low-risk short-term finance option for businesses. They
provide steady fixed-term interest rates as well as accessibility and flexibility. When financial
covenants are effectively satisfied, the business's connection with the bank is reinforced,
which may result in future beneficial situations. Effective management improves
creditworthiness by establishing a positive credit history. Repayment on time builds
confidence and prepares the organisation for more financial opportunities. Strategic financial
planning, open communication with the bank, and the use of bank loans to leverage financial
system development and stability are critical.
Collateral
A loan from a bank Collateral is defined as assets or property that a borrower promises to a
lender to secure the loan. If the borrower defaults on the loan, the collateral serves as security
for the lender.
11
6.0 CONCLUSION
Air Asia activities provide a clear example of the relevance of short-term finance to
businesses. Air Asia a key participant in the Malaysian airline industry, relies on long term
finance to run its day-to-day operations. Long term financing is used by the aircraft chain to
solve urgent demands such as aircraft loans, sale and leaseback, and export credit agencies.
This financial model enables Air Asia to negotiate seasonal swings in consumer demand and
ready to satisfy client demands during their holiday to another country.
Furthermore, Air Asia capacity to get long term funding is critical for capitalising on
time-sensitive opportunities and responding quickly to market dynamics. Long term
financing instruments' rapid and flexible character helps Air Asia to adjust unanticipated
problems, grasp long term development opportunities, and preserve financial resilience in a
highly competitive airline sector.
12
7.0 REFERENCES
13
8.0 APPENDIXES
14
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA, MALAYSIA
CLO3 Demonstrate numeracy skills in examining and analyzing a company’s financial statements.
Course Name: Course Code: Lecturer’s Name: SITI SYAMIRA BINTI MOHD RAMLI Group: BA1113A
Fundamentals of Finance FIN242/260/262
STUDENT’S NAME: LUQMANUL HAQEEM BIN AWANG EFIZAN STUDENT’S ID: 2022460686
Weighted
Marks Marks
Criteria Marks
Allocated 1 2 3 4 5 obtained
Usually participate and Mostly Consistently M/5 x 25%
FREQUENCY OF Never participate and Rarely participate and =5
sometimes participate and participate and
PARTICIPATION 25% volunteers’ point of volunteers
volunteers point of view. often volunteers routinely volunteers’
IN GROUP view. point of view.
point of view. point of view.
Adequately Regularly M/5 x 25%
Fails to perform assigned Rarely performs Always performs
ROLE performs assigned performs assigned =5
25% role within the group. assigned role within assigned role
PERFORMANCE role within the role within the
the group. within the group.
group. group.
Rarely interact well M/5 x 25%
Never interact well Adequately interact well Regularly interact well Always interact well
within the group and =5
within the group and within the group and within the group and within the group and
COOPERATION 25% sometimes respects
disrespect other group respect other group often respect other Consistently respect
other
members. group members. members. group members. other group members.
M/5 X 25% = 5
Always consistently
Never work toward Rarely work toward Occasionally work Frequently work toward
WORKS TOWARD work toward team
25% team goals and team goals and produce toward team goals and team goals and often
TEAM GOALS (e.g. goals and continually
produce poor quality mediocre quality work. adequately produce produce high quality
DEADLINES) produce high quality
work. quality work. work.
work.
100%
100/100
1
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA, MALAYSIA
CLO3 Demonstrate numeracy skills in examining and analyzing a company’s financial statements.
Course Name: Course Code: Lecturer’s Name: SITI SYAMIRA BINTI MOHD RAMLI Group: BA1113A
Fundamentals of Finance FIN242/260/262
Weighted
Marks Marks
Criteria Marks
Allocated 1 2 3 4 5 obtained
Usually participate and Mostly Consistently M/5 x 25%
FREQUENCY OF Never participate and Rarely participate and =5
sometimes participate and participate and
PARTICIPATION 25% volunteers’ point of volunteers
volunteers point of view. often volunteers routinely volunteers’
IN GROUP view. point of view.
point of view. point of view.
Adequately Regularly M/5 x 25%
Fails to perform assigned Rarely performs Always performs
ROLE performs assigned performs assigned =5
25% role within the group. assigned role within assigned role
PERFORMANCE role within the role within the
the group. within the group.
group. group.
Rarely interact well M/5 x 25%
Never interact well Adequately interact well Regularly interact well Always interact well
within the group and =5
within the group and within the group and within the group and within the group and
COOPERATION 25% sometimes respects
disrespect other group respect other group often respect other Consistently respect
other
members. group members. members. group members. other group members.
M/5 X 25% = 5
Always consistently
Never work toward Rarely work toward Occasionally work Frequently work toward
WORKS TOWARD work toward team
25% team goals and team goals and produce toward team goals and team goals and often
TEAM GOALS (e.g. goals and continually
produce poor quality mediocre quality work. adequately produce produce high quality
DEADLINES) produce high quality
work. quality work. work.
work.
100%
100/100
1
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA, MALAYSIA
CLO3 Demonstrate numeracy skills in examining and analyzing a company’s financial statements.
Course Name: Course Code: Lecturer’s Name: SITI SYAMIRA BINTI MOHD RAMLI Group: BA1113A
Fundamentals of Finance FIN242/260/262
STUDENT’S NAME: MUHAMMAD ADIB BIN AHMAD RAMLI STUDENT’S ID: 2022854446
Weighted
Marks Marks
Criteria Marks
Allocated 1 2 3 4 5 obtained
Usually participate and Mostly Consistently M/5 x 25%
FREQUENCY OF Never participate and Rarely participate and =5
sometimes participate and participate and
PARTICIPATION 25% volunteers’ point of volunteers
volunteers point of view. often volunteers routinely volunteers’
IN GROUP view. point of view.
point of view. point of view.
Adequately Regularly M/5 x 25%
Fails to perform assigned Rarely performs Always performs
ROLE performs assigned performs assigned =5
25% role within the group. assigned role within assigned role
PERFORMANCE role within the role within the
the group. within the group.
group. group.
Rarely interact well M/5 x 25%
Never interact well Adequately interact well Regularly interact well Always interact well
within the group and =5
within the group and within the group and within the group and within the group and
COOPERATION 25% sometimes respects
disrespect other group respect other group often respect other Consistently respect
other
members. group members. members. group members. other group members.
M/5 X 25% = 5
Always consistently
Never work toward Rarely work toward Occasionally work Frequently work toward
WORKS TOWARD work toward team
25% team goals and team goals and produce toward team goals and team goals and often
TEAM GOALS (e.g. goals and continually
produce poor quality mediocre quality work. adequately produce produce high quality
DEADLINES) produce high quality
work. quality work. work.
work.
100%
100/100
2
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA, MALAYSIA
CLO3 Demonstrate numeracy skills in examining and analyzing a company’s financial statements.
Course Name: Course Code: Lecturer’s Name: SITI SYAMIRA BINTI MOHD RAMLI Group: BA1113A
Fundamentals of Finance FIN242/260/262
STUDENT’S NAME: ABDULLAH FAHIM ZAKWAN BIN ZULWISLAN STUDENT’S ID: 2022833662
Weighted
Marks Marks
Criteria Marks
Allocated 1 2 3 4 5 obtained
Usually participate and Mostly Consistently M/5 x 25%
FREQUENCY OF Never participate and Rarely participate and =5
sometimes participate and participate and
PARTICIPATION 25% volunteers’ point of volunteers
volunteers point of view. often volunteers routinely volunteers’
IN GROUP view. point of view.
point of view. point of view.
Adequately Regularly M/5 x 25%
Fails to perform assigned Rarely performs Always performs
ROLE performs assigned performs assigned =5
25% role within the group. assigned role within assigned role
PERFORMANCE role within the role within the
the group. within the group.
group. group.
Rarely interact well M/5 x 25%
Never interact well Adequately interact well Regularly interact well Always interact well
within the group and =5
within the group and within the group and within the group and within the group and
COOPERATION 25% sometimes respects
disrespect other group respect other group often respect other Consistently respect
other
members. group members. members. group members. other group members.
M/5 X 25% = 5
Always consistently
Never work toward Rarely work toward Occasionally work Frequently work toward
WORKS TOWARD work toward team
25% team goals and team goals and produce toward team goals and team goals and often
TEAM GOALS (e.g. goals and continually
produce poor quality mediocre quality work. adequately produce produce high quality
DEADLINES) produce high quality
work. quality work. work.
work.
100%
100/100
3
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA, MALAYSIA
CLO2 Demonstrate leadership skills and responsibilities in evaluating and analyzing a company’s alternative financial strategies
Course Name: Course Code: Lecturer’s Name: SITI SYAMIRA BINTI MOHD RAMLI Group: BA1113A
Fundamentals of FIN242/260/262
Finance
STUDENT’S NAME: LUQMANUL HAQEEM BIN AWANG EFIZAN STUDENT’S ID: 2022460686
Weighted
Marks Marks
Criteria Marks
Allocated 1 2 3 4 5 obtained
Usually participate and Mostly Consistently M/5 x 25%
FREQUENCY OF Never participate and Rarely participate and =5
sometimes participate and participate and
PARTICIPATION 25% volunteers’ point of volunteers
volunteers point of often volunteers routinely volunteers’
IN GROUP view. point of view.
view. point of view. point of view.
Adequately performs Regularly M/5 x 25%
Fails to perform assigned Rarely performs Always performs
ROLE assigned role within performs assigned =5
25% role within the group. assigned role within assigned role within
PERFORMANCE the group. role within the
the group. the group.
group.
Rarely interact well M/5 x 25%
Never interact well Adequately interact well Regularly interact well Always interact well
within the group and =5
within the group and within the group and respect within the group and within the group and
COOPERATION 25% sometimes respects
disrespect other group other group members. often respect other group Consistently respect
other
members. group members. members. other group members.
M/5 X 25% = 5
Always consistently
Never work toward Rarely work toward team Occasionally work Frequently work toward
WORKS TOWARD work toward team
25% team goals and goals and produce toward team goals and team goals and often
TEAM GOALS (e.g. goals and continually
produce poor quality mediocre quality work. adequately produce produce high quality work.
DEADLINES) produce high quality
work. quality work.
work.
100%
100/100
4
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA, MALAYSIA
CLO2 Demonstrate leadership skills and responsibilities in evaluating and analyzing a company’s alternative financial strategies
Course Name: Course Code: Lecturer’s Name: SITI SYAMIRA BINTI MOHD RAMLI Group: BA1113A
Fundamentals of FIN242/260/262
Finance
STUDENT’S NAME: NURUL AIN BINTI SUKOR STUDENT’S ID: 2022628154
Weighted
Marks Marks
Criteria Marks
Allocated 1 2 3 4 5 obtained
Usually participate and Mostly Consistently M/5 x 25%
FREQUENCY OF Never participate and Rarely participate and =5
sometimes participate and participate and
PARTICIPATION 25% volunteers’ point of volunteers
volunteers point of often volunteers routinely volunteers’
IN GROUP view. point of view.
view. point of view. point of view.
Adequately performs Regularly M/5 x 25%
Fails to perform assigned Rarely performs Always performs
ROLE assigned role within performs assigned =5
25% role within the group. assigned role within assigned role within
PERFORMANCE the group. role within the
the group. the group.
group.
Rarely interact well M/5 x 25%
Never interact well Adequately interact well Regularly interact well Always interact well
within the group and =5
within the group and within the group and respect within the group and within the group and
COOPERATION 25% sometimes respects
disrespect other group other group members. often respect other group Consistently respect
other
members. group members. members. other group members.
M/5 X 25% = 5
Always consistently
Never work toward Rarely work toward team Occasionally work Frequently work toward
WORKS TOWARD work toward team
25% team goals and goals and produce toward team goals and team goals and often
TEAM GOALS (e.g. goals and continually
produce poor quality mediocre quality work. adequately produce produce high quality work.
DEADLINES) produce high quality
work. quality work.
work.
100%
100/100
5
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA, MALAYSIA
CLO2 Demonstrate leadership skills and responsibilities in evaluating and analyzing a company’s alternative financial strategies
Course Name: Course Code: Lecturer’s Name: SITI SYAMIRA BINTI MOHD RAMLI Group: BA1113A
Fundamentals of FIN242/260/262
Finance
STUDENT’S NAME: MUHAMMAD ADIB BIN AHMAD RAMLI STUDENT’S ID: 2022854446
Weighted
Marks Marks
Criteria Marks
Allocated 1 2 3 4 5 obtained
Usually participate and Mostly Consistently M/5 x 25%
FREQUENCY OF Never participate and Rarely participate and =5
sometimes participate and participate and
PARTICIPATION 25% volunteers’ point of volunteers
volunteers point of often volunteers routinely volunteers’
IN GROUP view. point of view.
view. point of view. point of view.
Adequately performs Regularly M/5 x 25%
Fails to perform assigned Rarely performs Always performs
ROLE assigned role within performs assigned =5
25% role within the group. assigned role within assigned role within
PERFORMANCE the group. role within the
the group. the group.
group.
Rarely interact well M/5 x 25%
Never interact well Adequately interact well Regularly interact well Always interact well
within the group and =5
within the group and within the group and respect within the group and within the group and
COOPERATION 25% sometimes respects
disrespect other group other group members. often respect other group Consistently respect
other
members. group members. members. other group members.
M/5 X 25% = 5
Always consistently
Never work toward Rarely work toward team Occasionally work Frequently work toward
WORKS TOWARD work toward team
25% team goals and goals and produce toward team goals and team goals and often
TEAM GOALS (e.g. goals and continually
produce poor quality mediocre quality work. adequately produce produce high quality work.
DEADLINES) produce high quality
work. quality work.
work.
100%
100/100
6
FACULTY OF BUSINESS MANAGEMENT
UNIVERSITI TEKNOLOGI MARA, MALAYSIA
CLO2 Demonstrate leadership skills and responsibilities in evaluating and analyzing a company’s alternative financial strategies
Course Name: Course Code: Lecturer’s Name: SITI SYAMIRA BINTI MOHD RAMLI Group: BA1113A
Fundamentals of FIN242/260/262
Finance
STUDENT’S NAME: ABDULLAH FAHIM ZAKWAN BIN ZULWISLAN STUDENT’S ID: 2022833662
Weighted
Marks Marks
Criteria Marks
Allocated 1 2 3 4 5 obtained
Usually participate and Mostly Consistently M/5 x 25%
FREQUENCY OF Never participate and Rarely participate and =5
sometimes participate and participate and
PARTICIPATION 25% volunteers’ point of volunteers
volunteers point of often volunteers routinely volunteers’
IN GROUP view. point of view.
view. point of view. point of view.
Adequately performs Regularly M/5 x 25%
Fails to perform assigned Rarely performs Always performs
ROLE assigned role within performs assigned =5
25% role within the group. assigned role within assigned role within
PERFORMANCE the group. role within the
the group. the group.
group.
Rarely interact well M/5 x 25%
Never interact well Adequately interact well Regularly interact well Always interact well
within the group and =5
within the group and within the group and respect within the group and within the group and
COOPERATION 25% sometimes respects
disrespect other group other group members. often respect other group Consistently respect
other
members. group members. members. other group members.
M/5 X 25% = 5
Always consistently
Never work toward Rarely work toward team Occasionally work Frequently work toward
WORKS TOWARD work toward team
25% team goals and goals and produce toward team goals and team goals and often
TEAM GOALS (e.g. goals and continually
produce poor quality mediocre quality work. adequately produce produce high quality work.
DEADLINES) produce high quality
work. quality work.
work.
100%
100/100
7
8