Solutions to Additional Applied Business Questions Based on Units 3, 4 and 5 of the Leaving Certificate Examination 2021 - Edco
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Student STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
Celtic Aromatics
(a) Skills – communicating, delegating responsibility, directing staff, organising.
Activities – planning, keeping accounts, cash budgeting, quality control, customer care,
controlling stock, training.
(b) Challenges – set up reward systems, solve existing industrial relations problems, make
necessary redundancies, retraining of staff, possible loss of key personel, to remove the
suspicions of staff, building good relations with trade unions, manpower planning for the future
(c) Licensing production of their products to firms in foreign markets
Enter more foreign markets as they did in the French market
Strategic alliances to attain strength in the Irish market or to enter new foreign markets.
Exam Hints and Tips
iStudent STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
Duncloon Meats Ltd
(a) Factors, communications methods: nature of the message, whether internal or external, urgency,
destination, cost, technology available, need for security, need for a record, whether formal or
informal.
(b) Management use of financial information:
Profit and loss account – to assess past performance, identify areas of weak or strong
performance, assess effectiveness of strategies employed.
Balance sheet – assess working capital needs, assess ability to raise capital.
Profitability – action to reduce costs increase revenues, close unprofitable operations,
compare to other years/companies.
Liquidity – action to improve ability to pay short term debts as they fall due.
Gearing – can assess the debt position of the firm.
Cash flow forecasts – to ensure no cash shortages will arise in future, to identify future
finance needs.
(c) Product screening: to ensure that the idea is worth developing, reality testing.
Concept development: ensures a clear definition of the product, its features, its market,
its unique selling point.
Feasibility study: prove on paper that it is possible from the point of view of production,
marketing, finance, profitability, resources etc.
Exam Hints and Tips
iiStudent STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
Marketing Approaches Limited
(a) Data controller requirements – all data collected fairly, data accurate and up to date, data only
used for lawful purposes, data disclosed only with the permission of the person concerned,
access allowed to files to persons who are subject of files, protect files from unauthorised
access.
(b) HRM strategies – establish grievance procedure for unhappy staff, use employee appraisal
system, rewards for staff, improve communications with staff, regular feedback, create
promotion opportunities, improve organisation structures, teamwork, empowerment.
(c) Marketing strategies – mail order sales, internet sales, direct marketing, use wholesalers and/
or retailers for distribution, branding, introductory offers, merchandising, promotions, pricing,
unique selling points.
Exam Hints and Tips
iiiStudent STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
Sac Designs Limited
(a) Communications – set up reliable internal communications channels, consult with employees
and get feedback on their concerns, regular meetings, build better relations with trade unions,
introduce teamwork systems, train staff in communication skills, listen and respond to customer
complaints, select appropriate technologies for communications, monitor effectiveness of
communication.
(b) Market research – allows them to identify the target market, differentiate between several target
markets, identify product features that customers want, work out price range for product, find
out the size of the market, find out about competitive products in the market.
(c) Quality management – introduce quality control procedures, develop a total quality management
(TQM) approach, promote a quality culture in the business, conduct regular quality audits, work
to attain a quality mark such as ISO9000 or the Q mark, provide training to all staff on quality
control, set up quality circles, empower staff in relation to improving quality, provide incentives to
staff related to quality achievement.
Exam Hints and Tips
ivStudent STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
Una Hilliard
(a) Planning – setting objectives gives clear direction, identify resources needed, ensure adequate
finance, select appropriate strategies, establish feasibility of the project, identify problem areas
to be dealt with, allows effective monitoring and control.
Organising – allows setting up suitable structures, allocation of responsibilities, ensure good
staff relationships.
Controlling – measurement and assessment of performance, ensures standards are maintained,
allows changes to be made when required, ensures good management of stock, cash and
quality.
(b) Tax – household – PAYE tax only, deducted at source V business – deduct and record PAYE and
PRSI for staff, record and make returns for VAT if applicable, return her own income tax as self
employed person including preliminary tax.
Insurance – household – insurance for buildings and contents only V business – insurance for
car, house, premises and contents, public liability, employee liability, fidelity guarantee.
(c) Marketing mix – product – mix of product/services on offer, target market, name/brand/identity,
packaging and presentation.
Price - premium price, profitability, cover costs, price discrimination OAPs, group discounts,
family tickets.
Promotion – advertising leaflets, garden magazines, local radio, internet homepage, open day,
special offers
Place – local signposts, travel agents, tourism information offices, local bed and breakfasts,
Exam Hints and Tips
gardening clubs, schools.
vStudent STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
Irish Colourcraft
(a)
High standards
Text: ‘the company made large profits, it did so at the expense of most of the stakeholders of
the business’
Decisive
Text: ‘Leroy decided to make changes in the approach to managing the company’
Motivated
Text: ‘Leroy was determined that the firm under his control would take its ethical and social
responsibilities seriously’
A people person
Text: ‘He wants to empower the staff to make decisions relevant to their work area’
Future focused
Text: ‘Leroy waited six weeks before deciding on any changes’
A leader
Text: ‘He knows that this change will take time to bring about but that it will bring a range of
benefits to the operation of the business’
(b) Empowerment
Can unlock the talents of each employee and benefit from the full potential of each employee
Exam Hints and Tips
Develops intrapreneurship
Increase ability of employees to respond to change
Employees get increased job satisfaction
Increases motivation to complete tasks well
Increases loyalty to the firm
Employees may improve so much they could earn a promotion
viStudent STUDY ESSENTIALS
TQM – Total Quality Management
Improved product quality and customer satisfaction
Increased customer loyalty and repeat orders
Reductions in costs and wastage of materials
Firm can charge higher prices in line with product quality
Good company reputation can lead to new customers and new markets
TQM makes everyone in the firm focused on common objectives
(c)
Develop own sales and distribution operation in each new country
Enter an alliance with a suitable firm in each market
Appoint an agent firm to sell Colourcraft products in each market
Set up manufacturing units in each or some of the markets
Franchise out production and /or sales of the product range to firms in each country
Take over or merge with a similar firm in each market
Exam Hints and Tips
viiStudent STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
Replast Ltd
(a)
Job production – individually designed and produced for customers – requires highly skilled
workers, high set-up and changeover costs – no stockholding.
Batch production – the production equipment is set up to produce a certain quantity of one
product before switching to a different product – quantities are produced and are held in stock
ready for sale – changeover delays are costly – labour employed is semi-skilled – sections of
the production may be automated.
Mass production – automated production process – identical products – low cost production
– low cost labour – economies of scale.
Replast should use batch production
They produce a number of similar products
They can use the same machines to make different products
Can produce at moderate cost
Can hold stocks of product ready for sale
(b)
An operational plan for a short-term specific objective
Evaluate the project, possibly using SWOT analysis
Identify resources required
Ensure sufficient finance is in place to fund the project
Exam Hints and Tips
Set clear objectives which are SMART – specific, measurable, agreed, realistic and timed
Write tactical plans for the completion of each piece of work
Anticipate problems that may arise and make contingency plans to deal with them
Set out review points as the project is executed, so that the plan can be revised if necessary
viiiStudent STUDY ESSENTIALS
(c)
Sources of long-term finance
Issuing of shares – no interest cost – can bring in new owners – security not required
Loan finance – no ownership control is lost – interest costs can be written off against tax
Government grants – if the firm meets the requirements the grant is free and does not have to
be paid back
Sale and lease back of an asset – firm retains use of the asset – cash can be used to fund
capital projects
Retained profits – interest free
Exam Hints and Tips
ixStudent STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
Finnegan Filing Systems
(a)
Strategies to manage change
Be informed on new laws and regulations that will affect the business
Invest in new technologies
Be future focused and anticipate change so that he can respond to it
Change to being proactive rather than reactive
He needs to change from being a controller manager towards being a facilitator manager. This
will make the whole organisation better able to respond to change
Develop employee empowerment enabling them to deal with change
Joe should develop teamwork among employees to get more creativity in dealing with change
(b)
Report
Title: Communications in Finnegan Filing Systems
To: Mr Joe Finnegan, Managing Director
From: Mr Henry Phillips, Pinnacle Management Consultants
Methodology: (1) Interviews with a selection of staff at all levels in the firm
(2) Reviews of proposed document for investment in ICT equipment
Findings:
Exam Hints and Tips
Staff feel that they are not consulted on a day-to-day basis about decisions that need to be
made. They feel they have a lot to contribute and that their input would improve the performance
of the business.
Recommendations:
The managing director should adopt a facilitator management style, taking input and feedback
from staff in the decision making process.
Communications should be divided into a two-way system, top down and bottom up. Regular
meetings and feedback systems should be put in place to make this happen.
xStudent STUDY ESSENTIALS
Findings:
The proposal to invest 30,000 euro in ICT equipment is a good one to ensure that the firm can
use the full range of technologies available.
The proposal does not include a budget for training staff in the use of the new communications
equipment.
Recommendations:
The purchase of equipment should be put out to tender to at least three possible suppliers to
ensure the best value for money spent.
A training programme for all staff needs to be planned over a period of time and money provided
to fund this work. Staff training is as important as the new technology.
Signed: Henry Phillips, B.Comm., MBA
(c)
Term loan
The 30,000 euro could be borrowed from a bank repayable over up to five years in instalments.
The firm might have to provide some kind of collateral or guarantee to the bank. There will be
an interest charge payable to the bank. The interest cost may be used to reduce the firm’s tax
liability. Borrowing cash allows the firm to negotiate a lower price for the equipment with the
supplier.
Hire purchase
The firm can enter into an agreement with a hire purchase company to buy the equipment over a
period of up to five years. Payment is made in instalments and ownership only transfers on final
payment. The equipment is security for the financing of the purchase should the buyer fail to
complete the payment. An initial deposit is usually paid and a written contract is signed.
Exam Hints and Tips
xiStudent STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
George and Sean Fogarty
(a)
Benefits of using new technologies:
Electronic Data Interchange (EDI)
Allows transactions to be completed more quickly and cheaper
Less staff needed meaning reduced costs
EDI link-ups make buyers more likely to order from the firm
Quick order delivery times allow stock levels to be reduced
Internet
The firm can communicate worldwide quickly and cheaply by email
The firm can set up a website to promote and advertise its products and services
The firm can do research worldwide by visiting the websites of other firms and institutions
Computerised production methods
Using computer aided design will improve design and reduce the cost of designing new metal
products
Automated machines and robotics allow production costs to be reduced as less workers are
needed
Quality control can be improved by the use of monitoring and control equipment on the
production line
Exam Hints and Tips
(b)
Strategies to ensure high quality standards
Ensure that raw materials and finished products are regularly tested
Pay attention to customer complaints and take action when necessary
Apply for quality standard certification such as ISO9000
Set up staff quality circles to come up with ways of improving quality
Spend money on research and development to continuously improve product quality
xiiStudent STUDY ESSENTIALS
(c)
Channels of distribution to export markets
Sell consumer products (garden ornaments) to importing wholesalers in foreign markets
They can sell their specialised casings to manufacturers in new markets
Sell garden ornaments to exporting wholesalers in Ireland who will in turn sell them into export
markets
They can sell their garden ornaments online and ship them direct to customers in other
countries
Appoint agent companies in foreign markets who will sell the products on behalf of the firm
earning commission
They could set up subsidiary companies in new markets to sell their products
Exam Hints and Tips
xiiiStudent STUDY ESSENTIALS
Solutions to Additional Applied Business Questions Based on
Units 3, 4 and 5 of the Leaving Certificate Examination 2021
Only key points are provided, students should develop these points to fully answer the question
asked.
Answers given are not exhaustive, not all answers given would be required in examination.
Kasanga Trading Ltd
(a)
How ICT could benefit the development of the business
Computer technology with word processing, database and spreadsheets makes running the
office functions faster and cheaper
New communications technologies reduce the number of staff required
Internet allows the firm to communicate effectively to all parts of the world
The firm’s products can be marketed and sold using the world wide web (website)
Mobile phone technology allows instant and continuous communications over great distances
while people are
on the move
Computer software packages are available to assist the operation of many parts of the
business
EDI would facilitate most of the communication and transfer of documentation between the
firm’s operations in Ireland and Africa
(b)
The importance of good management control systems
Financial control:
Cash flow forecasting – ensures you will not run out of cash
Budgetary control – avoids overspending
Exam Hints and Tips
Cost control – keeps costs at a low level
Quality control
Product quality meets legal standards
Minimises production of faulty goods
Ensures competitive advantage in the market place
Credit control
Avoids losses due to bad debts
Cuts the cost of collecting debts
Ensures cash at bank is maximised, reducing interest payments
xivStudent STUDY ESSENTIALS
Stock control
Keeps cost of maintaining stocks low
Ensures goods are available when needed
Minimises stock losses due to theft or wastage
(c)
Reasons for expanding the business
Joshua still has the motivation to expand because of the benefits to his family both in Ireland
and Kenya
Developing new areas of business such as export of medical products allows him to spread
the risks that his business is exposed to
Increased level of sales spreads the cost of developing their ICT systems and stock control
systems
Joshua has expanded organically so far, exploiting opportunities as they present themselves,
which exposes him to
less risk
Increased business will produce increased profits
Exam Hints and Tips
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