| Activity Ratio: |
Accounting ratios that measure a firm's ability to convert different accounts within their balance sheets into cash or sales. The Asset Turnover Ratio and Inventory Turnover Ratio are good examples. Companies will typically try to turn their production into cash or sales as fast as possible as this will generally lead to higher revenues. |
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| Administrative Notice: |
When CA - SBC is suspended to allow for processing of quarterly decision inputs (or perhaps for system maintenance), the administrator locks the database. Firms will not be able to submit inputs, and are given a notice to that effect. Such locks will last only a very short time (usually only minutes). In rare circumstances, the system might be locked for an extended period when maintenance is required. The CA - SBC Administrator will attempt to warn participants well in advance if possible. |
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| Advertising Expenditure: |
Advertising is one of the required decision inputs for each quarter of the competition. Advertising expenditures attract consumers to your product, thus increasing both demand and sales. Also see the discussion of Sales and Market Attraction. |
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| Amortisation: |
The adjustment of assets over time and the paying off of debt in regular installments over a period of time. Assets with finite lives lose value over time. Thus, investment in Plant & Equipment is amortised each quarter causing a reduction in its value. Continual investment is required to prevent erosion of production capacity. In fact, all decision input values [with the exception of Selling Price, Units Produced and Human Resources (Xtreme only)] are amortised and will show a reduction in impact if spending is not maintained. Also see Amortisation Period. |
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| Amortisation Period: |
The period over which assests, such as machinery, depreicate in value and the period over which a loan (principal plus interest, if any) must be repaid by the borrower. Also see Amortisation. |
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| Asset Turnover Ratio: |
Calculated as Revenue divided by Total Assets, this ratio indicates the relationship between assets and revenue. Firms with low profit margins tend to have high asset turnover, those with high profit margins have low asset turnover - an indication of pricing strategy. This ratio is more useful for growth firms if in fact they are growing revenue in proportion to sales. This ratio is not calculated in CA - SBC but can easily be produced using game outputs. |
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| Assets: |
Economic resource that provides future benefits to a business for carrying out its business activity (eg. land, cash, etc.). See the Financial Statement. |
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| Average Assets: |
Calculated as the sum of the total assets for the last two periods divided by 2. In CA - SBC, the period used is the quarter. |
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| Average Inventory: |
During any period, average inventory is calculated as the average of all preceding ending inventories. |
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| Balance Sheet: |
The financial statement that shows the financial position of a business at a specific point in time (Assets, Liabilities and Equity). For a complete description of all its components, please refer to Financial Statements. |
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| Blind Quarter: |
Normally, teams (firms in an industry) will receive feedback in the form of a Financial Statement and a comprehensive firm analysis at the close of each quarter. In the case of blind quarters, two or more sets of decision inputs must be made in the absence of feedback. Blind quarters are always announced in advance, and every effort is made to ensure that the firm recognises the fact that multiple inputs must be made. |
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| CAs of Ontario: |
The Institute of Chartered Accountants of Ontario is the qualifying and regulatory body of Ontario’s 33,000 Chartered Accountants and 5,000 CA students. The Institute works in partnership with the other provincial Institutes of Chartered Accountants and the Canadian Institute of Chartered Accountants to provide national standards and programs that are used as examples around the world. |
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| Cash: |
Cash obtained or used for day-to-day business activities. |
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| Cash Flows, Statement of: |
See Statement of Cash Flows. |
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| Chartered Accountant (CA): |
Chartered Accountants (CAs) are some of the most highly trained and skilled business professionals in the world. Most people think of Chartered Accountants (CAs) as number crunchers, or people who mainly deal with audits and taxes. However, the profession has changed. Many are part of the management team of various organizations and businesses, or they may be entrepreneurs running their own businesses or consultancy firms. CAs can also be in public practice, as partners or employees of a firm, or as sole practitioners, providing a variety of business advisory services for both small and large business clients. There are well over 60,000 CAs and CA students in Canada, making the CA profession the largest and most prominent accounting designation in the country. Find out how to become a CA today! |
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| Commodity: |
The semi-durable (lasts for a medium amount of time - a pen, a backpack, a stove, a MP3 player, or a Smartphone are examples) consumer good that every firm in every industry produces in CA - SBC competition. |
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| Competition: |
The CA - SBC is sometimes referred to by this term. To the CA - SBC Administrator, it means the sum of all activities for a particular year. To participants, it refers to their participation in, and interface to, CA - SBC. |
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| Cost (Total): |
An expense representing the cost to produce goods (see Cost of Production) plus Operating Expenses. Can also be calculated by multiplying the cost per unit as reported under Financial Ratios on the Firm Analysis page by the Supply (total production) under Market Indicators on the Firm Analysis page. |
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| Cost (Total/Unit): |
The total cost associated with one unit of production. It is calculated by dividing Total Cost by the number of units produced. Reported under Financial Ratios on the Firm Analysis page. |
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| Cost of Goods Sold (COGS): |
An expense representing the cost to produce goods that have been sold. For a complete description of all its components, please refer to Financial Statements. |
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| Cost of Production: |
The unit cost of production. The minimum cost of production in CA - SBC is set by the CA - SBC Administrator. The cost is a function of firm expenditures in Research & Development and Investment in Plant & Equipment. Firms who sell below this cost will experience a net loss of income. |
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| Current Ratio: |
An indication of a company's ability to meet short-term debt obligations; the higher the ratio, the more liquid the company is. Current ratio is equal to current assets divided by current liabilities. |
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| Days in Inventory: |
Indicates the average age of inventory, and is calculated as 365 days / the inventory turnover rate. This rate indicates how quickly a firm sells its goods. High days in inventory could indicate that the firm is incurring excessive carrying costs (e.g. interest, storage, insurance, taxes) as well as the possibility of inventory obsolescence. Low days in inventory indicates the firm is tying up little of its funds in inventory, thus it has a minimal amount of inventory on hand at any one time. Although minimising the funds tied up in inventory is efficient, too few days in inventory might indicate that the firm is losing sales opportunities (lost sales) because of inventory shortages. Also see inventory turnover rate. |
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| Debt Ratio: |
A solvency ratio which is calculated by dividing liabilities by total assets. This ratio will tell you how much the firm relies on debt to finance its assets. In general, the lower the firm's reliance on debt for asset formation, the less risky is the firm. |
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| Decision Inputs: |
Each quarter, firms are required to make decision inputs. In CA - SBC Classic, these are: Selling Price, Investment in Plant and Equipment, Advertising, Research & Development, Units Produced, and Purchase of Market Research Information. CA - SBC Xtreme players make all the CA - SBC Classic inputs as well as Sales Support and Human Resources. These inputs are used in the simulation to generate an industry scenario, and provide feedback on the success of a firm's decision strategy. An optional input is also allowed, in which a firm might be required by their teacher to enter their decision strategy rationale. See also quarterly expenditures. |
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| Decision Strategy: |
Each quarter, firms must make a series of decision inputs. These inputs should be based on some sort of market strategy. Teachers might wish to evaluate student performance by examining these inputs, whether systematically or randomly, by reviewing teacher summary reports of student activity in the competition. Decision strategy, or Rationale, is one such input. This input is optional and at the discretion of the teacher. |
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| Demand: |
The interest expressed in a firm's product by consumers. In terms of CA - SBC, it is best defined as the willingness of consumers to spend their money on a firm's product. The firm analysis page also expresses demand as market attraction. Demand is influenced by many, many variables, including Advertising, Research & Development, Sales Support, income and most importantly, selling price. Also see firm demand. |
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| Equity Ratio: |
Portion of total assets provided by shareholder equity, computed as total shareholder equity divided by total assets. Also see the Financial Statement. |
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| Estimated Capacity: |
Estimated capacity is the current production capacity of a firm rounded to the nearest 500 units. |
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| Financial Statement: |
At the close of each quarter, firms receive detailed feedback on their performance over the previous quarter. One such piece of feedback are the financial statements (see also firm analysis). The CA - SBC financial statements are quite detailed and comprehensive. For a complete description of all the components, please refer to Financial Statements. |
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| Firm: |
Students are arranged into teams by their teacher. These teams, when they compete in CA - SBC, are referred to as firms. All firms operate within an industry. Normally, an industry will be made up of teams/firms from the same class. Also see shadow firm. |
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| Firm Demand: |
As reported on the firm analysis page of CA - SBC, firm demand is the number of product units that consumers would consider purchasing in the current quarter from your firm given certain conditions (see Market Attraction for a complete discussion). This should not be confused with sales. If firm demand is higher than firm supply, you will forgo potential sales. If firm supply is higher than firm sales, the excess production will be carried in inventory. Also see market attraction, units sold, market share and lost sales. |
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| Full Time Equivalent (FTE): |
Full Time Equivalent (FTE) is a measure of the percentage of time a staff member works represented as a decimal. An FTE of 1.0 means that the person is equivalent to a full-time worker. An FTE of 0.5 signals that the worker is only part-time. Although the generally accepted human-resources meaning for the 'E' in FTE is 'equivalent', the term is often used to indicate a full-time employee. As in "Jake is an FTE, whereas Susan is a contractor". |
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| Gross Margin, Gross Profit, Gross Profit Margin: |
The difference between net sales (also referred to as revenue), which takes into account sales returns and allowances and sales discounts, and Cost of Goods Sold. Gross Profit represents the merchandising profit of a firm. It is not a measure of the overall profit of a firm because operating expenses have not been deducted. Comparisons of current gross profit with past amounts and rates, and with those in the industry, indicate the effectiveness of a firm’s purchasing and pricing policies. |
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| Gross Profit Margin Rate: |
A profitability ratio which indicates a firm’s ability to maintain an adequate selling price above its cost of goods sold. This ratio is determined by dividing Gross Profit by Net Sales (revenue). A decline in a firm’s gross profit rate might have several causes. The firm may have begun to sell products with a lower markup. Increased competition may have resulted in a lower selling price or the firm may be forced to pay higher prices to its suppliers without being able to pass these costs on to its customers. |
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| High School Business Competition (HSBC): |
The former name of the CA - Sprott Business Competition (SBC). |
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| Human Resources: |
Human Resources (HR) is one of the required decision inputs for each quarter in CA - SBC Xtreme. Firms must determine the number of employees required to produce at the desired level. Hiring and laying off employees are options, but firms must consider the effects of training and severance costs.
In CA - SBC Classic, firms do not make HR decisions. HR increases at the same rate for all firms within and industry and thus affects each one equally. |
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| Income: |
CA - SBC has a number of hidden parameters that are configured by the CA - SBC Administrator on a competition-wide basis. One such parameter is level of income. This is the level of income (disposable income) of consumers within the market. In, other words, income is the amount of money people have to spend on your products. The more money they have, the more they can buy. Income can be configured to grow, shrink or remain static as the competition progresses. It will normally be configured to increase linearly and slowly. There is a positive relationship between income and total demand. The actual level of income, as well as its trajectory, are never revealed to players. Playoff competitions will likely display variable income growth trends. |
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| Income Statement: |
The financial statement that provides a measure of the performance (net income or net loss) of an entity for a stated period of time. It summarizes firm revenues and expenses for a period. For a complete description of all its components, please refer to Financial Statements. |
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| Industry: |
All firms are located in an industry. Normally, firms from one class are located within their own industry for the main competition. All firms in the industry produce the same commodity (a semi-durable consumer good), and are in competition for the consumer's dollar. The firm(s) with the highest shareholder equity in each industry are invited to compete in playoff rounds if they have met minimum participation rules (they must have entered inputs in at least 50% of the quarters and must have the support of their teacher). |
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| Industry Analysis: |
At the close of each quarter, firms are provided with feedback from CA - SBC, allowing them to examine their competitive position within their industry. Each firm is ranked among all others in the industry in terms of shareholder equity. Selling price and shareholder equity are reported in the ranking table. Firms can choose to purchase a Market Research Report. By doing so, they will be given additional industry information, such as industry-wide, current-quarter averages for the decision inputs. |
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| Industry Scenario: |
When a CA - SBC competition is created, firms (which are teams of students) are assigned to an industry. As the competition progresses, firms will focus on their current standing in their industry, whereas to the CA - SBC Administrator, the collective standings and state of the industry are referred to as the industry scenario. |
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| Inputs (Decisions): |
See Decision Inputs. |
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| Inventory (Ending): |
Inventory at the end of a period is defined as the cumulative number of unsold units ever produced (firm supply) minus the total number ever sold (sales). The level of supply a firm can provide is constrained by the production capacity. Capacity is determined by Investment in Plant and Equipment, Research and Development, and the number of employees a firm has (Human Resources decision input in CA - SBC Xtreme). |
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| Inventory Carrying Costs: |
Those costs that arise from having inventory on hand, such as storage space costs, handling costs, property taxes, insurance, and obsolescence losses. |
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| Inventory Turnover Rate: |
An activity ratio that measures the average number of times the inventory is sold during the period. Its purpose is to measure the liquidity of inventory. The inventory turnover rate is calculated by dividing the cost of goods sold by the average inventory during the period. Low inventory turnover could indicate that the firm is incurring excessive carrying costs. High inventory turnover indicates the firm is tying up little of its funds in inventory, thus it has a minimal inventory on hand at any one time. Although minimising the funds tied up in inventory is efficient, too high an inventory turnover ratio may indicate that the firm is losing sales opportunities (lost sales) because of inventory shortages. Also see Days in Inventory. |
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| Investment in Plant and Equipment (P&E): |
One of the required decision inputs per quarter. The level of investment in P&E by a firm determines manufacturing production capacity. Neglect in this area will lead to the inability of a firm to produce enough to meet sales. However, excess expenditure in this area may lead to inefficiency and thus cost overruns. P&E must be balanced with HR in order to maximize profit, and thus increase shareholder equity. Note that investment in P&E does not take immediate effect. This is a long term investment. |
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| Job: |
The fastest way to a well-paid, exciting and fulfilling career is to get a degree from the Sprott School of Business at Carleton University.
Bachelor of Commerce (Honours)
Concentrations include: Marketing, Information Systems, Finance, Accounting, Managing People & Organisations, International Business, and Operations Management.
Bachelor of International Business (Honours)
Concentrations include: International Marketing and Trade, Strategic Management and International Human Resources, and International Investment, Finance, and Banking.
Masters of Business Administration (MBA)
PhD in Management
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| Liabilities: |
Economic obligations of a business to another party (creditor) arising from a past transaction. |
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| Liquidity: |
How fast asset value is realised by the firm. In other words, the ability or ease with which assets can be converted into cash. |
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| Loans: |
Firms start the competition with a cash balance (normally $30,000). As the competition progresses from quarter to quarter, firms may find themselves in a position where they do not have sufficient cash to meet quarterly expenditures. In this case, CA - SBC will automatically grant a loan to a firm. The loan amount is calculated as the amount required to satisfy the current cash shortfall, plus $10,000. This ensures that all firms have at least $10,000 in cash each quarter. Firms are required to repay the loan on a quarterly basis. The amortisation period is configurable by the CA - SBC Administrator and is not divulged to participants.
There is no interest on a firm's first loan. Industry Canada's 'Small Business Initiative' program is providing ONE INTEREST FREE LOAN to assist new start up firms. This will help to increase a firm's chances of success. HOWEVER: should a firm take out a second loan, interest will be added on to both the second AND the first loan. This is due to the assumption that the firm had to renegotiate their loan. The rate of interest increases with each subsequent loan and the entire existing outstanding loan amount is renegotiated at the new rate.
It is also important to note that a firm WILL NOT be granted loans of unlimited amounts. Loans will be based on a percentage of the firm's Cash as of the end of the previous quarter. For example, should a firm attempt submit inputs of a total of $75,000 for Quarter 6, but only have $30,000 available as of the end of Quarter 5, the firm will see an error message informing them that they have overspent and must reduce their spending to meet the loan limits. Firm are only allowed to spend approximately 10% above their available cash. Thus, it is VERY IMPORTANT to SPEND WISELY!
The financial statement contains detailed information about loans, from which the values of important variables such as amortisation period can be calculated. |
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| Lost Sales: |
The difference between firm demand and sales. While consumers might be attracted to a firm's product, this attraction is not always translated into sales. For a complete discussion of this concept, see Market Attraction. |
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| Market Attraction: |
As reported in the firm analysis page of CA - SBC (see snippet below), market attraction is the percentage of consumers who would consider buying a particular firm's product if it were available in sufficient quantities, was properly advertised and marketed, was of acceptable quality, had attractive features, and where the sales channel was adequately compensated for merchandising and selling the item (see Sales Support). CA - SBC calculates the total size of the market in any quarter, and apportions that demand to individual firms based on relative indicators (certain decision inputs). The entire market demand is apportioned in this manner. This should not be confused with sales. Attraction represents the potential sales a firm can make. The firm in the sample below failed to reach its sales potential (selling only 3,500 units). This difference between demand and sales is referred to as lost (unmet) sales. Lost sales can also occur if there is not sufficient inventory available for sale. Also see the financial statement. Firm Demand is the numeric expression of market attraction.
Market Indicator
| Market Attraction: |
15.36 % |
| Market Share: |
15.76 % |
| Demand (Units): |
3,907 |
| Potential Sales (Units): |
3,907 |
| Supply (Units): |
3,500 |
| Sales (Units): |
3,500 |
| Unmet Sales (Units): |
407 | |
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| Market Research Report: |
For a starting cost of $2,000, firms can buy information regarding the state of the market, such as industry averages. An example is the average price within the market. This information appears as tables on the Industry Analysis page if a firm chose to purchase a report for that quarter. |
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| Market Share: |
As reported on the firm analysis page (see snippet under Market Attraction), market share is the firm's unit sales divided by the total industry unit sales (the sum of all sales this quarter in this industry), expressed as a percentage. |
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| Market Strategy: |
The plan laid out by a firm, designed to maximize the firm's profit. In CA - SBC, market strategy is defined by the interaction of the decision inputs that firms make each quarter. This strategy can be input into the 'Rationale' input on the quarterly decision input screen. Teachers can inspect the rationale in their teacher login area. |
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| Markup: |
The difference between the wholesale price and the retail price of merchandise, often expressed as a percentage. |
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| Merchandising Profit: |
Profit generated from the sale of merchandise/inventory. |
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| Net Earnings: |
See Net Income. |
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| Net Income: |
The earnings a firm realizes after all costs, expenses and taxes have been paid. It is calculated by subtracting business, depreciation, interest and tax costs from revenues. When expenses exceed revenues, a net loss results. |
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| Notes to Financial Statements: |
Notes appended to the statements, providing explanations and supporting schedules to which the financial statements are cross-referenced. The notes are an integral part of such statements. For a complete description of all its components, please refer to Financial Statements. |
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| Operating Expenses: |
Expenses associated with running a business but not considered directly applicable to the current line of goods and services being sold. For a complete description of all its components, please refer to Financial Statements. |
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| (CA - SBC) Program Administrator: |
The CA - SBC Program Administrator, generally referred to simply as the CA - SBC Administrator, is responsible for maintaining the integrity of the competition. The staff at the Sprott School of Business create the competition, set the due dates for quarters and blind quarters, and closely monitor the competition in order to make adjustments to the game parameters when necessary. The most noticeable task performed by the staff is the bi-weekly decision input processing. Questions, comments, complaints and accolades are always welcome at: sbc@sprott.carleton.ca. |
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| Period: |
A measure of time. In CA - SBC, the only period we use is the Quarter. |
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| Potential Sales: |
Whereas demand is the total interest expressed in a firm's product by consumers, potential sales is the amount a firm could actually sell based on demand and whether or not the firm's product is available and accessible. For example, a product may have terrific advertising support and a good price point, and thus be in high demand. But if that product is not accessible because it is not on in all stores or if salespeople are not being adequately paid or trained to sell it, that demand will not translate into sales. See also demand, sales support and advertising expenditure. |
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| Price: |
See Selling Price. |
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| Prime (Rate): |
The rate at which banks and other lending institutions charge their best customers. The prime rate in CA - SBC is configurable by the CA - SBC Administrator. Your interest rate will be reported on the Financial Statement if you have an outstanding loan. |
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| Processing: |
Once the deadline for decision inputs has passed for any quarter, the CA - SBC Administrator will lock the competition from further input by firms, and will initiate processing of the inputs and generation of the outputs (financial statements, firm analysis, and industry analysis) for the quarter. |
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| Production (Units): |
See Supply (Units). |
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| Production Capacity: |
The number of units a firm can produce in a given quarter. The optimal production capacity is the number of units a firm can produce at the highest level of efficiency. Production capacity is determined by investment in Plant & Equipment, Research & Development, and Human Resources. |
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| Production Cost: |
The unit cost of production. This only includes costs, such as materials and labour, which are directly involved in the actual production of the products. Cost of production varies in CA - SBC between minimum and maximum costs per unit, which are set by the CA - SBC Administrator. The cost is a function of firm expenditures in Research & Development and Investment in Plant & Equipment. Also see Total Cost. |
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| Profit: |
Profit is a nebulous term. There are various ways to define or determine the level of profit. In the CA - SBC, profit is best seen as the net change in net income from quarter to quarter. Net change can be either positive, negative or zero. See the Financial Statement as well as Quarterly Expenditures and Retained Earnings. Also see Net Income. |
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| Profit Margin: |
Sometimes referred to as Rate of Return on Sales, profit margin is a profitability ratio, and measures the percentage of each dollar of sales that results in Net Earnings. It is computed by dividing Net Income by Net Sales (Revenue) for the period. See also Gross Profit Margin Rate. |
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| Profit/Unit: |
Calculated by dividing Net Income by Sales (units). This is a measure of the profit generated by each unit sold. Negative values are possible if firms set their price and sell units at a level below their Total Cost per Unit. |
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| Quarter: |
A period of three calendar months. In CA - SBC, a set of decision inputs is required each quarter, and a series of outputs (financial statements, firm analysis, and industry analysis) is delivered to firms once the quarter has been processed by the CA - SBC Administrator. A competition is made up of an undisclosed number of quarters. Also see blind quarter and period. In CA - SBC, a quarter corresponds to one season (spring, summer, fall, or winter) of the year. Also see Seasonality. |
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| Quarter Events: |
Based on a similar concept as Blind Quarters, Quarter (or Random) Events are meant to simulate a change in conditions in the marketplace. This could be a change in demand, a natural disaster, a shift in economic conditions, or any other event that would impact a business or industry. These events can occur at any time throughout the competition. Teams should watch for these events on their firm analysis page. |
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| Quarterly Earnings: |
See Profit. |
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| Quarterly Expenditures: |
In CA - SBC, quarterly expenditures are the sum of the investment decision inputs. In Classic these inputs are: Selling Price, Advertising, Research & Development, Investment in Plant & Equipment, Units Produced, and Purchase of Market Research. In Xtreme, teams enter the same inputs as in Classic, but also make decisions regarding Sales Support and Human Resources. |
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| Random Events: |
See Quarter Events. |
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| Randomness: |
There is a small element of randomness in the quarterly calculations of the CA - SBC. The random element serves to dissuade players from attempting to determine the exact output of the various algorithms that make up the competition. This randomness makes it impossible to exactly replicate any particular quarter's results. |
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| Rationale: |
See decision strategy. |
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| Receivables: |
Refers to amounts due from individuals and companies. Receivables are claims that are expected to be collected in cash. |
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| Research & Development: |
Research & Development (R&D) expenditures serve to make a firm's product more attractive to consumers as a function of being more technically current and feature-rich. Failure to spend in R&D results in lower consumer interest and fewer sales. R&D also has a small effect on unit cost of production as certain activities in R&D can lead to manufacturing efficiencies. |
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| Return on Assets: |
A profitability ratio indicating how many dollars of net earnings were earned for each dollar invested in assets. Thus, the higher the return on assets (ROA), the more profitable the firm. This ratio is calculated by dividing net income by total assets for the period. |
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| Return on Equity (ROE): |
A profitability ratio showing how many dollars of net earnings were earned for each dollar invested by the owners. It is calculated by dividing net earnings by shareholder equity. |
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| (CA -) Sprott Business Competition: |
CA - Sprott Business Competition is run annually by the Sprott School of Business at Carleton Universityin Ottawa, Canada and is spnsored by the Institute of Chartered Accountants of Ontario. CA - SBC is designed to enrich the educational experience of high school students. The competition has been run since 1985 (minusa short, one-year hiatus in 2009), and became a province-wide competition in 2003. It is a business simulation game, originally crafted by Distinguished Research Professor George Haines Jr. (Retired) of Sprott. |
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| Sales: |
Sales (Revenue) is the income from sales of goods and services, minus the cost associated with things like returned or undeliverable merchandise. In CA - SBC, sales revenue is calculated by multiplying the total units sold by the selling price. Also called Net Sales, Net Revenue, and just plain Revenue. |
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| Sales (% of Market Attraction): |
Calculated by dividing Sales (in units) by Firm Demand (in units), expressed as a percentage. Shows how effective the firm is in meeting Market Attraction. A low percentage could indicate that the quality of your product is poor (as a result of relatively low spending in R&D) or the product is not available to customers, indicating insufficient spending in Sales Support. Other potential causes include Price, Advertising, and Units Produced. |
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| Sales (Units): |
The total number of units sold in any quarter. In CA - SBC, several sales indicators are provided. In the snippet below, sales totaled 3,500 units in the current quarter. Firm demand was for 3,907 units.
Market Indicator
| Market Attraction: |
15.36 % |
| Market Share: |
15.76 % |
| Demand (Units): |
3,907 |
| Potential Sales (Units): |
3,907 |
| Supply (Units): |
3,500 |
| Sales (Units): |
3,500 |
| Unmet Sales (Units): |
407 | |
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| Sales Support: |
One of the quarterly decision inputs in CA - SBC Xtreme. Activities in this area include such things as salesperson commissions, promotional activities, merchandising, strengthening ties with suppliers, global branding initiatives and the development of new distribution channels. Neglect of this area will lead to an erosion of a firm's market position. In addition, an inadequately-marketed product is difficult to purchase. All the advertising and price point in the world can't make consumers buy a product that isn't on the shelves or that does not pay adequate commission to salespeople to promote.
In CA - SBC Classic, Sales Support is not a decision input. It does, however, still have an affect on sales. Behind the scenes, each firm is investing in Sales Support at a slightly increasing rate. Each firm within an industry invests the same each quarter and thus all firms are affected equally. |
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| Seasonality (Seasonal Trend): |
The consumer semi-durable manufactured by all firms in the competition is subject to a certain predictable seasonality. For example, sales may peak during the Winter season due to Christmas gift shopping, and fluctuate thereafter. Firms should bear seasonal fluctuations in mind when deciding their investment strategy. For example, demand will likely rise around Christmas time and so it may be wise to produce more to maximize sales opportunities. A season corresponds exactly to a quarter in CA - SBC. |
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| Selling Price: |
One the quarterly decision inputs. Selling price is among the more critical inputs. Firms that attempt to undercut their competitors by selling below the industry average will experience decreasing rates of return as their price moves farther from the norm. Conversely, firms can price themselves out of the market on the high end as consumers choose products more in line with their expectations of the price of the product. The minimum selling price that a firm can set is $50. The maximum price that firms can set for their product is $250. |
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| Shadow Firm: |
One or more shadow firms may be present in each industry during the competition. The function of such firms is to stabilise the industry by bringing selling price and decision input variables back into line. The overall effect is minimal when industries are very closely grouped around the default values. Sometimes shadow firms actually lead the competition during certain quarters (though this is very unlikely). In such a case, they won't be invited to the playoffs... ;-) In addition, due to amortisation, such firms cannot maintain competitive advantage, and quickly fall to the bottom of the leader board. Also see firm. |
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| Shareholder Equity: |
The measurement used by CA - SBC to rank how firms are performing within an industry. For a complete description of all its components, please refer to Financial Statements. |
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| Simulation: |
The CA - SBC represents a simulated marketplace wherein firms compete within virtual industries for the consumer's dollar. |
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| Solvency Ratio: |
Measures a firm’s ability to meet its long-term obligations. |
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| Statement of Cash Flows: |
The financial statement that explains the changes (uses and sources) in cash balances during a stated period of time. The statement discloses the impact on cash as a result of all three activities: operating, investing and financing. For a complete description of all its components, please refer to Financial Statements. |
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| Statement of Retained Earnings: |
The financial statement that lists the beginning balance in retained earnings, followed by a description of any changes that occurred during the period (net income or net loss, dividends paid) and the ending balance. For a complete description of all its components, please refer to Financial Statements. |
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| Summary Reports: |
Teachers are provided with their own login and password to facilitate the monitoring of student firm activity from quarter to quarter. Teachers can easily inspect all their student firm's decision inputs and, if requested of student firms by their teacher, the rationale for their decisions. Participation rates are also provided so teachers can track which teams are actively competing. |
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| Supply (Units): |
The number of units produced by your firm for the current quarter. Seen on the firm analysis page. |
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| Total Assets: |
The current sum of Cash, Inventory and Plant & Equipment. |
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| Total Cost (per unit): |
Total cost per unit includes the production cost per unit plus other costs incurred by a firm. Firms which sell at a price below this cost will experience a net loss of income. |
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| Turnover (Employee): |
Employee Turnover is the ratio of the number of workers that had to be replaced in a given time period to the average number of workers. Turnover occurs when employees leave a firm due to reasons such as retirement, career moves, etc. |
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| Units Produced (UP): |
A decision input in CA - SBC. Firms must specify the number of units they wish their firm to produce based on production capacity and demand. |
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| Units Sold: |
The total number of manufactured units available for sale that were sold in the current quarter. Units available consists of current production plus inventoried items (if any). Also see Sales (Units). |
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| Very Good Students: |
That's what Sprott attracts. We consistently finish in the top three and frequently finish first in both Canadian and International Accounting Skills competitions. If you're interested in Accounting, there is no better school in Ontario than Sprott! Absolutely dynamite prospects for students who combine Accounting (or Finance) with the Information Systems or Marketing concentrations at Sprott. And a good accounting degree can help you get your CA designation too! |
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| X: |
X marks the spot! And it's SPROTT! |
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