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ACC543 v9
ACC/543 Grading Rubrics
Wk 2 – Summative Assessment: Net Present Value and Internal Rate of Return ………………………………………………………………………………………….. 2
Wk 4 – Summative Assessment: Flexible Budget ……………………………………………………………………………………………………………………………………… 5
Wk 5 – Summative Assessment: WH Framework ……………………………………………………………………………………………………………………………………… 8
Copyright 2023 by University of Phoenix. All rights reserved.
Grading Rubrics
ACC/543 v9
Page 2 of 9
Wk 2 – Summative Assessment: Net Present Value and Internal Rate of Return
Accomplished
90-100%
A- to A
Emerging
70-89%
C- to B+
Beginning
50-69%
F to D+
1. Computations
Weight: 10%
Showed the net present
value and internal rate of
return for each project; the
net present value and
internal rate of return were
completely correct;
showed all calculation
details, and calculations
were completely correct
Showed the net present
value and internal rate of
return for each project; the
net present value and
internal rate of return were
partially correct; showed
some calculation details
and calculations are
partially correct
Showed the net present
value and internal rate of
return for each project; the
net present value and
internal rate of return were
not correct; showed some
calculation details and
calculations are mostly
incorrect
Did not show the net
present value and internal
rate of return or did not
show calculation details
2. Net Present Value
Analysis
Weight: 15%
Thoroughly analyzed
results of the net present
value calculation; showed
the significance of results
from a creative and
innovative perspective;
examples thoroughly
supported the analysis
Partially analyzed results
of the net present value
calculation; partially
showed the significance of
results; examples mostly
supported analysis
Narrowly analyzed results
of the net present value
calculation; narrowly
showed significance of
results; examples
minimally supported
analysis
Did not analyze the results
of the net present value
calculation; did not analyze
significance of results; did
not include examples to
support analysis
3. Net Present Value
Approach Decision
Weight: 10%
Determined which project
should be adopted based
on the net present value
approach and provided a
thorough, creative, and
innovative rationale to
support decision
Determined which project
should be adopted based
on the net present value
approach and provided a
partial rationale to support
decision
Determined which project
should be adopted based
on the net present value
approach and provided a
narrow rationale to support
decision
Did not determine which
project should be adopted
based on the net present
value approach or did not
provide a rationale to
support decision
4. Internal Rate of Return
Analysis
Weight: 15%
Thoroughly analyzed the
results of the internal rate
of return calculation;
showed the significance of
results from a creative and
innovative perspective;
Partially analyzed the
results of the internal rate
of return calculation;
partially showed the
significance of results;
Narrowly analyzed results
of the internal rate of return
calculation; narrowly
showed the significance of
results; examples partially
supported analysis
Did not analyze results of
the internal rate of return
calculation; did not analyze
significance of results; did
not provide examples to
support analysis
Criteria and Weight
Copyright 2023 by University of Phoenix. All rights reserved.
Not Evident
0%
Grading Rubrics
ACC/543 v9
Page 3 of 9
Accomplished
90-100%
A- to A
Emerging
70-89%
C- to B+
examples thoroughly
supported analysis
examples mostly
supported analysis
5. Internal Rate of Return
Approach Decision
Weight: 15%
Determined which project
should be adopted based
on the internal rate of
return approach and
provided a thorough,
creative, and innovative
rationale to support
decision
Determined which project
should be adopted based
on the internal rate of
return approach and
provided a partial rationale
to support decision
Determined which project
should be adopted based
on the internal rate of
return approach and
provided a narrow
rationale to support
decision
Did not determine which
project should be adopted
based on the internal rate
of return approach or did
not provide a rationale to
support decision
6. Preferred Method
Decision
Weight: 15%
Determined the preferred
method for the given
circumstances and
provided thorough,
creative, and innovative
reasons and details to
support decision
Determined the preferred
method for the given
circumstances and
provided partial reasons
and details to support
decision
Determined preferred
method for given
circumstances and
provided narrow reasons
and details to support
decision
Did not determine
preferred method for given
circumstances or did not
provide reason and details
to support decision
7. Best Investment
Opportunity
Recommendation
Weight: 15%
Thoroughly synthesized
the results of analyses and
computations from a
creative and innovative
perspective to determine
the best investment
opportunity to recommend
to the president of
Donovan Enterprises
Partially synthesized the
results of analyses and
computations to determine
the best investment
opportunity to recommend
to the president of
Donovan Enterprises
Narrowly synthesized the
results of analyses and
computations to determine
the best investment
opportunity to recommend
to the president of
Donovan Enterprises
Did not synthesize the
results of analyses and
computations to determine
the best investment
opportunity to recommend
to the president of
Donovan Enterprises
8. Writing
Weight: 3%
The Net Present Value and
Internal Rate of Return
presentation was concise,
with exceptional attention
to detail, and it was free of
errors.
The Net Present Value and
Internal Rate of Return
presentation showed
attention to detail through
careful editing and quality
writing; minimal writing
The Net Present Value and
Internal Rate of Return
presentation lacked detail
and careful editing;
numerous writing
convention errors (e.g.,
Significant errors detracted
from the readability of the
content.
Criteria and Weight
Beginning
50-69%
F to D+
Copyright 2023 by University of Phoenix. All rights reserved.
Not Evident
0%
Grading Rubrics
ACC/543 v9
Page 4 of 9
Criteria and Weight
9. APA Guidelines
Weight: 2%
Accomplished
90-100%
A- to A
The Net Present Value and
Internal Rate of Return
presentation was properly
formatted according to
APA guidelines and
included correct
APA citations for all
sources.
Emerging
70-89%
C- to B+
Beginning
50-69%
F to D+
convention errors (e.g.,
spelling, punctuation,
usage, and sentence
formation) were present.
spelling, punctuation,
usage, and sentence
formation) were present;
errors may or may not
have detracted from the
readability of the content.
The Net Present Value and
Internal Rate of Return
presentation was partially
formatted according to
APA guidelines, and
it included APA citations for
sources with few errors.
The Net Present Value and
Internal Rate of Return
presentation was minimally
formatted according to
APA guidelines, and it
included incorrect
APA citations for sources.
Copyright 2023 by University of Phoenix. All rights reserved.
Not Evident
0%
The Net Present Value and
Internal Rate of Return
presentation formatted
according to APA
guidelines and did not
include APA citations for
sources.
Grading Rubrics
ACC/543 v9
Page 5 of 9
Wk 4 – Summative Assessment: Flexible Budget
Accomplished
90-100%
A- to A
Emerging
70-89%
C- to B+
Beginning
50-69%
F to D+
1. Prepared flexible
budget
Weight: 10%
Created a flexible budget
in Excel showing all work
and formulas, and all
calculations are correct
Created a flexible budget
in Excel showing most
work and formulas, and
most calculations are
correct.
Created a flexible budget
in Excel showing minimal
work and formulas, and
some calculations are
correct
Did not create a flexible
budget
2. Computing the sales
volume variance and
variable cost volume
variances
Weight: 10%
In Excel, all components of
the computations of the
sales volume and variable
cost volume variances
based on a comparison
between the master
budget and the flexible
budget were correct.
In Excel, most components
of the computations of the
sales volume and variable
cost volume variances
based on a comparison
between the master
budget and the flexible
budget were correct.
In Excel, some
components of the
computations of the sales
volume and variable cost
volume variances based
on a comparison between
the master budget and the
flexible budget were
correct.
Did not compute the sales
volume and variable cost
volume variances based
on a comparison between
the master budget and the
flexible budget
3. Computing the flexible
budget variance
Weight: 10%
In Excel, computation of
flexible budget variances
based on comparison
between the flexible
budget with the actual
results was completely
correct.
In Excel, computation of
flexible budget variances
based on comparison
between the flexible
budget with the actual
results was mostly correct.
In Excel, computation of
flexible budget variances
based on comparison
between the flexible
budget with the actual
results was somewhat
correct.
Did not compute flexible
budget variances based on
comparison between the
flexible budget with the
actual results
4. Summarized the
results of the sales
volume and variable cost
volume variances
Weight: 13%
Thoroughly summarized
the results of the sales
volume and variable cost
volume variances
computations based on a
comparison between the
master budget and flexible
budget from a creative and
innovative perspective
Partially summarized the
results of the sales volume
and variable cost volume
variances computations
based on a comparison
between the master
budget and flexible budget
Narrowly summarized the
results of the sales volume
and variable cost volume
variances computations
based on a comparison
between the master
budget and flexible budget
Did not summarize the
results of the sales volume
and variable cost volume
variances computations
based on a comparison
between the master
budget and flexible budget
Criteria and Weight
Copyright 2023 by University of Phoenix. All rights reserved.
Not Evident
0%
Grading Rubrics
ACC/543 v9
Page 6 of 9
Accomplished
90-100%
A- to A
Emerging
70-89%
C- to B+
Beginning
50-69%
F to D+
Not Evident
0%
5. Summarized the
results of the flexible
budget variances
Weight: 13%
Thoroughly summarized
the results of the flexible
budget variances
computations based on a
comparison between the
flexible budget and actual
results from a creative and
innovative perspective
Partially summarized the
results of the flexible
budget variances
computations based on a
comparison between the
flexible budget and actual
results
Narrowly summarized the
results of the flexible
budget variances
computations based on a
comparison between the
flexible budget and actual
results
Did not summarize the
results of the flexible
budget variances
computations based on a
comparison between the
flexible budget and actual
results
6. Justified the budget
variances
Weight: 13%
Thoroughly justified the
favorable or unfavorable
budget variances from a
creative and innovative
perspective
Partially justified the
favorable or unfavorable
budget variances
Narrowly justified the
favorable or unfavorable
budget variances
Did not justify the favorable
or unfavorable budget
variances
7. The importance of
meeting the budget
Weight: 13%
Thoroughly discussed why
someone should be
concerned with a not-forprofit organization meeting
the budget from a creative
and innovative perspective
Partially discussed why
someone should be
concerned with a not-forprofit organization meeting
the budget
Narrowly discussed why
someone should be
concerned with a not-forprofit organization meeting
the budget
Did not discuss why
someone should be
concerned with a not-forprofit organization meeting
the budget
8. Recommendations for
staying on budget
Weight: 13%
Provided thorough,
creative, and innovative
recommendations for
staying on budget and
supported all
recommendations with
examples
Provided partial
recommendations for
staying on budget and
supported most
recommendations with
examples
Provided narrow
recommendations for
staying on budget and
supported some
recommendations with
examples
Did not provide
recommendations for
staying on budget or
provide any examples
9. Writing
Weight: 3%
The Flexible Budget
presentation was concise,
with exceptional attention
to detail, and it was free of
errors.
The Flexible Budget
presentation showed
attention to detail through
careful editing and quality
writing; minimal writing
convention errors (e.g.,
The Flexible Budget
presentation lacked detail
and careful editing;
numerous writing
convention errors (e.g.,
spelling, punctuation,
Significant errors detracted
from the readability of the
content.
Criteria and Weight
Copyright 2023 by University of Phoenix. All rights reserved.
Grading Rubrics
ACC/543 v9
Page 7 of 9
Criteria and Weight
10. APA Guidelines
Weight: 2%
Accomplished
90-100%
A- to A
The Flexible Budget
presentation was properly
formatted according to
APA guidelines and
included correct
APA citations for all
sources.
Emerging
70-89%
C- to B+
Beginning
50-69%
F to D+
spelling, punctuation,
usage, and sentence
formation) were present.
usage, and sentence
formation) were present;
errors may or may not
have detracted from the
readability of the content.
The Flexible Budget
presentation was partially
formatted according to
APA guidelines, and
it included APA citations for
sources with few errors.
The Flexible Budget
presentation was minimally
formatted according to
APA guidelines, and it
included incorrect
APA citations for sources.
Copyright 2023 by University of Phoenix. All rights reserved.
Not Evident
0%
The Flexible Budget
presentation formatted
according to APA
guidelines and did not
include APA citations for
sources.
Grading Rubrics
ACC/543 v9
Page 8 of 9
Wk 5 – Summative Assessment: WH Framework
Accomplished
90-100%
A- to A
Emerging
70-89%
C- to B+
Beginning
50-69%
F to D+
1. WH Framework Chart
Weight: 15%
Created a WH Framework
chart that included a
comprehensive, creative,
and innovative list of
stakeholders and
guidelines
Created a WH Framework
chart that included a partial
list of stakeholders and
guidelines
Created a WH Framework
chart that included a
narrow list of stakeholders
and guidelines
Did not create a WH
Framework chart
2. Explanation of relevant
stakeholders
Weight: 15%
Thoroughly explained the
stakeholders that Trzaska
and L’Oreal’s management
catered to and why from a
creative and innovative
perspective
Partially explained
stakeholders that Trzaska
and L’Oreal’s management
catered to and why
Narrowly explained
stakeholders that Trzaska
and L’Oreal’s management
catered to and why
Did not explain the
stakeholders that Trzaska
and L’Oreal’s management
catered to
3. Explanation of values
Weight: 15%
Thoroughly explained the
values L’Oreal’s
management chose when
they made the decision to
fire Trzaska and why, from
a creative and innovative
perspective
Partially explained the
values L’Oreal’s
management chose when
they made the decision to
fire Trzaska and why
Narrowly explained the
values L’Oreal’s
management chose when
they made the decision to
fire Trzaska and why
Did not explain values
L’Oreal’s management
chose when they made the
decision to fire Trzaska
4. Analyzing situation
using WH Framework
Weight: 17%
Thoroughly discussed how
the WH Framework helped
to analyze the situation
from a creative and
innovative perspective
Partially discussed how the
WH Framework helped to
analyze the situation
Narrowly discussed how
the WH Framework helped
to analyze the situation
Did not discuss how the
WH Framework helped to
analyze the situation
5. Making decisions with
the WH Framework
Weight: 18%
Thoroughly discussed how
the WH Framework helped
with making business
decisions from a creative
and innovative perspective
Partially discussed how the
WH Framework helped
with making business
decisions
Narrowly discussed how
the WH Framework helped
with making business
decisions
Did not discuss how the
WH Framework helped
with making business
decisions
Criteria and Weight
Copyright 2023 by University of Phoenix. All rights reserved.
Not Evident
0%
Grading Rubrics
ACC/543 v9
Page 9 of 9
Accomplished
90-100%
A- to A
Emerging
70-89%
C- to B+
Beginning
50-69%
F to D+
Not Evident
0%
6. Types of decisions
using WH Framework
Weight: 15%
Thoroughly discussed the
types of decisions the WH
Framework would help a
manager make from a
creative and innovative
perspective
Partially discussed the
types of decisions the WH
Framework would help a
manager make
Narrowly discussed the
types of decisions the WH
Framework would help a
manager make
Did not discuss the types
of decisions the WH
Framework would help a
manager make
7. Writing
Weight: 3%
The WH Framework
explanation and reflection
was concise, with
exceptional attention to
detail, and it was free of
errors.
The WH Framework
explanation and reflection
showed attention to detail
through careful editing and
quality writing; minimal
writing convention errors
(e.g., spelling, punctuation,
usage, and sentence
formation) were present.
The WH Framework
explanation and reflection
lacked detail and careful
editing; numerous writing
convention errors (e.g.,
spelling, punctuation,
usage, and sentence
formation) were present;
errors may or may not
have detracted from the
readability of the content.
Significant errors detracted
from the readability of the
content.
8. APA Guidelines
Weight: 2%
The WH Framework
explanation and reflection
was properly formatted
according to APA
guidelines and included
correct APA citations for all
sources.
The WH Framework
explanation and reflection
was partially formatted
according to APA
guidelines, and it included
APA citations for sources
with few errors.
The WH Framework
explanation and reflection
was minimally
formatted according to
APA guidelines, and it
included incorrect
APA citations for sources.
The WH Framework
explanation and reflection
formatted according to
APA guidelines and did not
include APA citations for
sources.
Criteria and Weight
Copyright 2023 by University of Phoenix. All rights reserved.
Review the scenario and watch this week’s videos before you complete the activity below.
This scenario can also be found in the “Problems – Series A” section 10-19A of Ch. 10,
“Planning for Capital Investments” of Fundamental Managerial Accounting Concepts.
Scenario: Dwight Donovan, the president of Donovan Enterprises, is considering 2
investment opportunities. Because of limited resources, he will be able to invest in only 1 of
them. Project A is to purchase a machine that will enable factory automation; the machine
is expected to have a useful life of 4 years and no salvage value. Project B supports a
training program that will improve the skills of employees operating the current
equipment. Initial cash expenditures for Project A are $400,000 and for Project B are
$160,000. The annual expected cash inflows are $126,000 for Project A and $52,800 for
Project B. Both investments are expected to provide cash flow benefits for the next 4 years.
Donovan Enterprises’ desired rate of return is 8 percent. Your task as Senior Accountant is
to use your knowledge of net present value and internal rate of return to identify the
preferred method and best investment opportunity for the company and present your
results to Dwight Donovan.
Use Excel®—showing all work and formulas—to compute the following:
• Compute the net present value of each project. Round your computations to 2
decimal points.
• Compute the approximate internal rate of return for each project. Round your rates
to 6 decimal points
Create an 8- to 12-slide PowerPoint® presentation showing the comparison of the net
present value approach with the internal rate of return approach calculated above.
Complete the following in your presentation:
• Analyze the results of the net present value calculations and the significance of these
results, supported with examples.
• Determine which project should be adopted based on the net present value
approach and provide a rationale for your decision.
• Analyze the results of the internal rate of return calculation and the significance of
these results, supported with examples.
• Determine which project should be adopted based on the internal rate of return
approach and provide a rationale for your decision.
• Determine the preferred method in the given circumstances and provide reasoning
and details to support the method selected.
• Synthesize results of analyses and computations to determine the best investment
opportunity to recommend to the president of Donovan Enterprises.
Assignment Content
For this assignment, refer to the scenario located in “Problems – Series A” section
10-19A of Ch. 10, “Planning for Capital Investments” of Fundamental
Managerial Accounting Concepts. This scenario puts you at task as a Senior
Accountant for Donovan Enterprises to identify the preferred method and best
investment opportunity for the company.
Read the scenario in the textbook and complete the activity below.
Use Excel®—showing all work and formulas—to compute the following:
1. Compute the net present value of each project. (Round your
computations to 2 decimal points.)
2. Compute the approximate internal rate of return for each project.
(Round your rates to 6 decimal points.)
Showing the comparison of the net present value approach with the internal rate of
return approach calculated above. Complete the following in your presentation:
1. Analyze the results of the net present value calculations and the
significance of these results, supported with examples.
2. Determine which project should be adopted based on the net
present value approach and provide rationale for your decision.
3. Analyze the results of the internal rate of return calculation and
the significance of these results, supported with examples.
4. Determine which project should be adopted based on the internal
rate of return approach and provide rationale for your decision.
5. Determine the preferred method in the given circumstances and
provide reasoning and details to support the method selected.
6. Synthesize results of analyses and computations to determine the
best investment opportunity to recommend to the president of
Donovan Enterprises.
a.
NPV of A: $17,328.00
b.
Rate of return of B: 12%
Problem 10-19A Using net present value and internal
rate of return to evaluate investment opportunities
Dwight Donovan, the president of Donovan Enterprises, is
considering two investment opportunities. Because of limited
resources, he will be able to invest in only one of them. Project
A is to purchase a machine that will enable factory automation;
the machine is expected to have a useful life of four years and
no salvage value. Project B supports a training program that
will improve the skills of employees operating the current
equipment. Initial cash expenditures for Project A are
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$400,000 and for Project B are $160,000. The annual expected
cash inflows are $126,000 for Project A and $52,800 for
Project B. Both investments are expected to provide cash flow
benefits for the next four years. Donovan Enterprises’ desired
rate of return is 8 percent.
Required
a.
Compute the net present value of each project. Which
project should be adopted based on the net present value
approach? Round your computations to two decimal points.
b.
Compute the approximate internal rate of return of each
project. Which one should be adopted based on the internal
rate of return approach? Round your rates to six decimal
points.
c.
Compare the net present value approach with the internal
rate of return approach. Which method is better in the given
circumstances? Why?
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A. NPV analysis and its significance :Net Present value is calculation of All the outflow of cash and inflow of cash
being bring at the value of today ( Zero Time) to understand that whethe we
should take the decision or drop it. NPV calculation is a tool to understand
that what our outcomes will stand if they all happen today, so it helps people
to understand that whether decision will make profit for them or make loss.
I have already told you that it is just a tool for calculations of present value of
future cash outflows and inflows. Many times calculation of NPV is not
significant. E.g. If market price of a product is going down to the level of cost
of production of that product than in that situation there is only 2 option,
make an investment to make cost of production lower or shut down the
business. So in this situation any kind of tool like NPV or IRR will not help and
calculating them will have no impact on decision.
2. Decision on the basis of NPV :For both of the options we have calculated NPV and the results are presented
above. NPV is the total value of Cash inflow at the present time i.e. Zero
point. NPV primarily seeks to identify the most viable investment
opportunities by comparing the present value of future cash flows of projects.
The rationale behind the NPV method is its focus on the maximization of
wealth. So if we compare the both the option than we should go for Option A.
Option A has NPV of $17,327.98 which is very much as compared to the NPV
of option B so it will maximise the wealth and profit for the organisation as
compared to Option B.
3. IRR and its significance :IRR measures how well a project, capital expenditure or investment performs
over time. It helps to compare one investment to another or determine
whether or not a particular project is viable.The internal rate of return is the
interest rate that occurs when the net cash related to the investment equals
zero. Calculating the IRR will show if your company made or lost money on a
project. The IRR makes it easy to measure the profitability of your investment
and to compare one investment’s profitability to another. If the IRR is better
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than average or exceeds your company’s cost of capital, then invest in the
project. If choosing between multiple investments, choose the investment
with the highest IRR, assuming all exceed the cost of capital, which is a
combination of the cost of your company’s long-term debt, preferred stock, if
it has any, and shareholder’s equity.
4. Decision on the basis of IRR:In information above we have calculated IRR for both the option above. IRR of
Option B is 12.110% where IRR of Option A is 9.931%. So it is clear that we
should go for Option B because it has higher IRR. IRR is calculation of Return
when inflows and outflows are made equal. In simple words we can say that
IRR is the Rate of Profit on every Single $ spent on investment. So even
though option B is having only $ 372.05 NPV but it has return of 12.110% on
every $ spent in investment. So we should go for Option B.
5. Preferred Method for Investment Decision :Mutually exclusive projects are projects in which acceptance of one project
excludes the others from consideration. In case of mutually-exclusive
projects, an NPV and IRR conflict may arise in which one project has a higher
NPV but the other has higher IRR. The conflict either arises due to relative
size of the project or due to the different cash flow distribution of the
projects. Since NPV is an absolute measure, it will rank a project adding more
dollar value higher regardless of the initial investment required. IRR is a
relative measure, and it will rank projects offering best investment return
higher regardless of the total value added.
Whenever an NPV and IRR conflict arises, always accept the project with
higher NPV. It is because IRR inherently assumes that any cash flows can be
reinvested at the internal rate of return. This assumption is problematic
because there is no guarantee that equally profitable opportunities will be
available as soon as cash flows occur. NPV, on the other hand, does not suffer
from such a problematic assumption because it assumes that reinvestment
occurs at the cost of capital, which is conservative and realistic. So in case of
conflict between these 2 always go for NPV because it has realistic results.
6. Decsion suggestion for President of Donovan Enterprises :In all above answers and solutions we have discussed everything about NPV
and IRR for both the projects. We have discussed than in case of mutually
exclusive options always go for Option having highest NPV.
So we would suggest the President of Donovan Enterprises that he should go
for Option A i.e. Purchase of Machinery.
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Based on NPV ,Project A can be selected Since it has the highest NPV.
(B)Computation of Internal Rate of Return
Internal Rate of Return (IRR) of a project is the discount rate which makes Net Present
Value of the project zero.Based of calculations Project B can be selected ,since it has
higher IRR.
(C) Acoording to NPV project A is better but according to IRR,Project B is better.When
such conflicts occurs select project with higher NPV.
ACC/543: Managerial Accounting & Legal Aspects Of Business
Wk 2 – Apply: Summative Assessment: Net
Present Value and Internal Rate of Return
[due Day 7]
Wk 2 – Apply: Summative Assessment: Net
Present Value and Internal Rate of Return
[due Day 7]
Rubric Details
• Computations
10% of total grade
•
Net Present Value Analysis
15% of total grade
•
Net Present Value Approach Decision
10% of total grade
•
Internal Rate of Return Analysis
15% of total grade
•
Internal Rate of Return Approach Decision
15% of total grade
•
Preferred Method Decision
15% of total grade
•
Best Investment Opportunity Recommendation
15% of total grade
•
Writing
3% of total grade
•
APA Guidelines
2% of total grade
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