Case Study for Folly Fashions

School of Business BUACC5930 Accounting Concepts and Practices Assignment, Semester 2, 2010

This assignment constitutes 20 per cent of the total assessment in this course. Students are required to complete the assignment in groups of three and do not have an automatic entitlement to adopt some other arrangement (for example, to complete the assignment individually or in a group of two, or more than three students). Students who have difficulty finding a partner or who encounter other difficulties (for example, their partner withdraws from the course) should consult the lecturer/tutor. Note: Assignments submitted by more than three members in a group will not be assessed and students shall receive no marks for the submitted work. Any variation from this rule must be approved by your lecturer and a copy of the written approval must be attached with the assignment. Students must keep the original as a proof. Variations can only be accepted in exceptional cases and are not available generally. The assignment is to comply with the University’s General Guide for the Presentation of Academic Work (http://www.ballarat.edu.au/aasp/student/learning_support/generalguide/). Assignments that are submitted late will be penalised at the rate of 1 marks per weekday that the assignment is late for the first week and 2 marks per day thereafter. The total marks for the assignment is 20 marks.

Folly Fashions Pty Ltd

Folly Fashions Pty Ltd manufactures women's fashion wear for sale in major retail outlets, with items appealing to the 25+ age group and priced at the upper end of the range. The items are sold at wholesale prices to retailers, who can return unsold items at the end of the season and receive full credit. At the end of each manufacturing cycle, in May and November, the company has `factory sales' to partly clear its stores of the season's excess production. Folly's seasonal working capital needs have been financed primarily by loans from the Commercial Bank of...