Cost Control & Profitability Analysis Assignment: A Report on Malaysian Retail Chain

Reflective case summary

Instruction to students: You are required to attach both the Turnitin report and AI Turnitin report that show the percentage of plagiarism. You may upload these two reports independently or attach them to the end page of the assignment. No extension is allowed without valid reasons, e.g. hospitalisation. 

You are hired as a junior management consultant by a mid-sized retail company in Malaysia that operates three departments: Clothing, Electronics, and Groceries. The company is experiencing cost overruns and inconsistent departmental performance.

Management has requested both qualitative analysis and basic quantitative insights to support planning and control decisions.

Your task is to prepare a report in MS Word or PDF  (maximum 1,000 words) that includes the following:

Section A: Cost Classification and Relevance

1. Explain the different types of costs in a retail business context (e.g., fixed, variable, direct, indirect).
2. Discuss which of these are relevant for planning and control purposes, and why.

Section B: Basic Cost Analysis and Interpretation

Using the data below, perform basic calculations and interpret the results.

Note:

Contribution Margin (RM)

• Formula:

Contribution Margin = Sales – Variable Costs

Contribution Margin Ratio (%)

• Formula:

Contribution Margin Ratio = (Contribution Margin ÷ Sales) × 100

Net Profit/Loss (RM)

• Formula:

Net Profit/Loss = Contribution Margin – Fixed Costs

You are required to:

• Compare the contribution margin and net profit across all departments. 
• Identify which department is more profitable or efficient and justify your reasoning.
• Recommend actions to improve financial performance, such as:

Focus on high-margin departments,
Reduce unnecessary costs,
Revise pricing or promotions.

Section C: Internal Reporting and Managerial Use

Design a simple internal performance report format (e.g., a table or dashboard) to help managers monitor costs and profits monthly.
Explain how this internal report would help with:

• Budget planning
• Departmental accountability
• Operational control

Section D: Limitations and Practical Insights

Discuss limitations and real-world issues of using such simplified accounting data:

• Challenges in allocating fixed costs
• Behaviour impact on department heads
• Uncontrollable vs. controllable costs

Requirement

Your report must contain the following components:

Executive Summary (Approx. 150 words)

Summarise key findings:

• Contribution margin and net profit by department
• Recommendation: e.g., improve control in Groceries, focus investment in Clothing
• Highlight the usefulness of internal cost reports for planning/control

Section A: Cost Classification and Relevance (Approx. 300 words)

Section B: Basic Cost Analysis and Interpretation (Approx. 500–600 words)

Section C: Internal Reporting & Control (Approx. 300–400 words)

Section D: Limitations and Practical Insights (Approx. 300 words)

Conclusion (Approx. 150 words)

References

• Use at least 3–5 credible sources (e.g., textbooks in the last years only, academic articles in the last 5 years only, CIMA resources)

Guideline:

• You are required to write 1,000 words.
• Justify your answer with at least 5 APA references.
• Using font type of “Times New Roman” with size of 12 and double spacing.
• Submit and attach the Turnitin report with the assignment
• You are encouraged to display figures, tables and other graphical forms invariably.
• Submit and attach the Turnitin reports (Similarity report and AI turnitin report)  with the assignment

Penalty for late submission:

Within 1 working day after the deadline: 50% reduction in marks earned.
Beyond 1 working day after the deadline: The Assignment is awarded 0 marks.

Rubric 20 marks

Total points: 20

Oral presentation

• Due Monday by 23:59
• Point 10
• Submitting a text entry box, a media recording, or a file upload
• Available 20 Jul at 0:00 – 28 Jul at 23:59

Instructions to students: You are required to record this video (5 to 7 minutes) with the camera on. You need to submit the following documents:

1. Recording (Media file). DO NOT submit this file using the link. Instead, pls upload this file here. 
2. Powerpoint slides (Canva or MS PPT slides). You are acting as a junior management consultant for a mid-sized Malaysian retail company with three departments: Clothing, Electronics, and Groceries. The company has requested a short executive briefing on your findings to guide their internal planning and cost control efforts

Based on the individual assignment, your presentation must cover the Following:

1. Key Cost Concepts Used
   • Explain cost classifications and relevance to decision-making (e.g., fixed vs. variable, direct vs. indirect).
2. Simple Financial Analysis (with Visual Aids)
   • Present your calculated contribution margin, contribution margin ratio, and net profit/loss using tables or graphs.
   • Clearly explain what these figures mean in the context of each department’s performance.
3. Interpretation and Managerial Implications
   • Identify which department is performing best and why.
   • Recommend actions based on your cost analysis (e.g., cost control, pricing changes, resource allocation).
4. Proposed Internal Report Format
   • Suggest a format (e.g., monthly departmental dashboard) that management can use for tracking performance and costs.
5. Reflection on Limitations
   • Briefly highlight the limitations of the analysis and what managers should be cautious of when using this data.

Rubric

Rubric (oral presentation) 10 marks

Total points: 10