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ASSIGNMENT 2
QUESTION 1 (36 Marks)
Rezesco Ltd (“Rezesco”) is an investment company that holds various investments across several industries.
The company’s investments are limited to the Southern African Development Community (SADC) member
countries. Rezesco’s has a 28 February financial year-end.
1. Rezesco’s wholly owned companies for the 2022 and 2023 financial years
Investment Industry
territory Tele- Electronics
communications
South Africa Tectab (Pty) Ltd (“Tectab”) Electron (Pty) Ltd (“Electron”) is in
manufactures and sells two types of the business of manufacturing and
tablets, a basic-home tablet (“BhT”) selling two types of CPUs. These
CPU’s are used in the
and a professional tablet (“PfT”).
manufacturing of tablets. Electron
The main manufacturing is required to prioritise the supply of
component of each tablet is a the CPUs to Tectab. In this regard,
central processing unit (CPU). All for each product type, 40% of the
CPUs are bought internally within manufactured CPUs are currently
the group and exclusively from sold to the external market while
Electron (Pty) Ltd ("Electron"). 60% are sold internally to Tectab.
2. Possible close-down of Electron
Electron’s costs of manufacturing electronic components has increased significantly over the past three
years. Due to this cost increase, Rezesco is considering the possibility to discontinue Electron’s operations
ASSIGNMENT 2
QUESTION 1 (36 Marks)
Rezesco Ltd (“Rezesco”) is an investment company that holds various investments across several industries.
The company’s investments are limited to the Southern African Development Community (SADC) member
countries. Rezesco’s has a 28 February financial year-end.
1. Rezesco’s wholly owned companies for the 2022 and 2023 financial years
Investment Industry
territory Tele- Electronics
communications
South Africa Tectab (Pty) Ltd (“Tectab”) Electron (Pty) Ltd (“Electron”) is in
manufactures and sells two types of the business of manufacturing and
tablets, a basic-home tablet (“BhT”) selling two types of CPUs. These
CPU’s are used in the
and a professional tablet (“PfT”).
manufacturing of tablets. Electron
The main manufacturing is required to prioritise the supply of
component of each tablet is a the CPUs to Tectab. In this regard,
central processing unit (CPU). All for each product type, 40% of the
CPUs are bought internally within manufactured CPUs are currently
the group and exclusively from sold to the external market while
Electron (Pty) Ltd ("Electron"). 60% are sold internally to Tectab.
2. Possible close-down of Electron
Electron’s costs of manufacturing electronic components has increased significantly over the past three
years. Due to this cost increase, Rezesco is considering the possibility to discontinue Electron’s operations
