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Peer Review

The Profit & Loss Account



Overall Rating:

2.5 stars
Content Quality: 2.5 stars
Effectiveness: 2.5 stars
Ease of Use: 2.5 stars
Reviewed: Jun 29, 2006 by Business Editorial Board
Overview: The objective of this simulation is to illustrate how the profit & loss account
is affected by changes in the internal and external environment of
the firm. The simulation allows users to change a selection of inputs to identify
the consequences on turnover, cost of sales, gross profit, net profit, profit
on ordinary activities before taxation, retained profit and all the other
sections that are included within the profit & loss account.
Learning Goals: The goal of this site is to provide students with the opportunity to modify
inputs and then see how these changes flow through the profit and loss statement.
Target Student Population: British students who have a basic background in accounting principles.
Prerequisite Knowledge or Skills: Accounting terminology and an understanding of ratios and their significance.
Type of Material: Simulation
Recommended Uses: This module appears to be constructed as an in-class teaching exercise although it could also be used as a homework assignment.
Technical Requirements: Any current browser

Evaluation and Observation

Content Quality

Rating: 2.5 stars
Strengths: For British students the module would appear to be a good vehicle to move beyond basic
accounting to see how modifications in the environment lead to changes in the profit
and loss statement. The module can help students move beyond the memorization stage to the
usability stage of accounting information.
Concerns: This module may be difficult for students to use on their own. No
really good overview and introduction exists. The generic purpose of the model is provided, however the related material contained in the module is inadequate. Clarity is lacking. Concepts are not demonstrated nor are ideas and problems illustrated. Integration and summarization is also lacking.

Potential Effectiveness as a Teaching Tool

Rating: 2.5 stars
Strengths: Well implemented from a technology standpoint. A generic overview of the simulation is provided. A few study questions are
Concerns: Little is provided to make this module a potentially effective teaching
tool. No objectives or prerequisite knowledge is specified. Concepts do not build progressively, nor are relationships demonstrated between concepts. This module merely provides a shortcut to ‘number crunching’ certain given
ratios. For U.S. students this module would difficult to use. Valuations are denoted in British
pounds. Numbers align left rather than right making them difficult to read for
a person used to seeing them aligned right. Having no commas in large
numbers also makes the figures difficult to interpret.

Ease of Use for Both Students and Faculty

Rating: 2.5 stars
Concerns: Since this module is part of a series of simulations, no instructions exist.
Although visual appeal, interactivity, and design quality are adequate, the lack of instructions seriously hinders the module's ease of use.