Hi,

I have an assessment regarding to the financial management.

Thanks

Part A - Written or Oral Questions 1. List TWO sources of information that may help a manager to estimate the cost for the coming year. (2 Marks - 1 Mark per point) 2. ldentify and briefly describe THREE examples of external banking records which are used for the purpose of record keeping (3 Mark 1 Mark per example) 3. List the relevant personnel you may communicate with in the organisation to ensure that documented outcomes and information about customers, Competitors and business operations. (2 Marks) 4. What is a contingency plan? Explain the reasons for a contingency plan? What are the steps to follow to prepare and develop a contingency plan? List THREE specific areas to include in the plan. (10 Marks) 5. What is a financial plan? What should financial plans include? What are the external and internal factors that may affect the financial planning? (10 Marks) 6. What is a budget? What are the objectives of a budget? What is the role of the master budget? (10 Marks) 7. Scenario: You are an accountant for APC Bikes, a manufacturer of sturdy mountain bikes for intermediate-level bikers. The variable costs per bike include: Direct materials: Direct Materials: Wheels/tyres $20.00 Components $70.00 Frame $50.00 Total direct materials $140.00 Direct labour $39.75 Variable overhead $75 Total cost per bike $254.75 You decide to create a budget variance analysis that reflects the actual volume of sales. The budgeted selling price is $800(per bike). The budgeted fixed costs of manufacturing overhead is $20,200,000 and the budgeted support department costs is $32,956,430 Using the following template to create a budget variance analysis including the calculation of variances. Flexible budget Actual Variance Favourable/Unfavourabl e Bikes sold 113,500 113,500 Revenue ? $90,500,000 ? ? Variable ? $29,492,408 ? ? Fixed overhead ? $19,400,000 ? ? Support department costs ? $37,565,337 ? ? Net income ? $4,042,255 ? ? Product costs: Total variance Notes: > You are required to fill in the place with "?" only. > Flexible budget is a budget that reflects a range of operations in which fixed and variable costs are separated to more accurately reflect the effects of activity levels on cost. > Favourable variance is a variance in which actual revenues are larger than the budget, or actual costs are lower than the budget. > Unfavourable variance is a variance in which actual costs are greater than budgeted, or actual revenues are less than budgeted. Tasks for Question 7: i. Complete the above flexible budget variance report (15 Marks - 1 Marks per item) ii. Based on the schedule, what is your opinion about the entity's performance? (3 Marks) iii. What actions are you going to take based on the flexible budget variance analysis? (2 Marks) 8. What is a good cash management? (3 Marks) 9. What is cost-volume-profit (CVP) analysis and how is it used in decision making? (5 Marks) 10. Scenario: APC Bikes, a manufacturer of sturdy mountain bikes for intermediate-level bikers. Due to the increasing popularity of cross-country cycling, the management of APC Bikes wants to produce a new mountain bike. After discussions with the sales and production teams, management has forecast the following information: Price per bike $800 Variable cost per bike $300 Fixed costs related to bike production $5.500,000 Targeted pre-tax profit $300,000 Targeted post- tax profit $210,000 Tax Rate 30% Required :Calculate breakeven in units and total revenue. (6 marks) 11. Goods and services tax (GST), which was introduced in July 2000, is a broad-based tax of 10% of most goods, services and other items sold or consumed in Australia. Describe the THREE types of supplies under the GST legislation. (6 Marks - 2 Marks each) 12. Scenario: Brian is running an ice cream shop. He paid $9.50 per hour for $3,950 hours of working in packing 40,000 buckets of ice cream. The standard labour rate is $8 per hour. How much is the direct labour price variance (i.e. the difference between the actual price for labour and the standard price)? Is the variance favourable or unfavourable? List the possible reasons for this variance? (5 Marks) 13. When evaluating financial information systems, what factors will you need to consider? (3 Marks) Part B 1. 2. List and describe the 5 common types of budgets. (5 marks) Listed below are the names of some of the commonly used budgets in business. Using the 5 common types of budgets identified in Question 1, determine the budget type for each listed budget. (5 marks) Commonly used Budgets Budget Type a. Room Revenue Budget b. Refurbishment Budget c. Event Budget d. Contract Cleaning Budget e. Printing Budget f. Marketing Budget g. Cash Budget h. Budget for a Small Business i. Advertising Budget What is cash flow? Give one example of how an organisation can control its cash flow.(5 marks) 4. Cash (Flow) Budget Prepare a Cash Flow Statement for months 1-6 using the following forecast details(10 marks) 3. Months 1 2 3 4 5 6 Cash from Sales $9,000 $10,800 $12,600 $19,800 $21,600 $25,200 Cash from Debtors $30,000 $1,000 $1,200 $1,400 $2,200 $2,400 $7,660 $15,070 $16,440 $19,180 Cash Receipts Capital Cash Payments Stock Purchases $17,000 Advertising and Promotion $3,000 $1,000 $1,000 $1,000 Rent $1,733 $1,733 $1,733 $1,733 $1,733 $1,733 Wages $1,933 $1,933 $1,933 $1,933 $1,933 $1,933 Other expenses $5,106 $606 $1,056 $606 $606 $1056 Asset Purchases $3400 Drawings $1600 $1600 $1600 $1600 $1600 $1600 Forecast Cash Flow Statement for Year Ended Mth 1$ Mth 2$ Mth 3$ Mth 4$ Mth 5$ Mth 6$ Cash Positionstart of month Cash Receipts Cash sales Cash from Sales Debtors Proceeds from asset sales Capital contribution s Borrowings Total cash receipts Less cash payments Advertising Stock Purchases Wages Rent Loan repayments Other Expenses Asset Purchases Drawings Total Cash Payments Net Cash Flow Cash position end of month 5. 6. When collecting data for analysis what are the two sources we can get data from? (2 marks) How can data collected help an organisation determine the effectiveness of their financial 7. 8. 9. management processes? (3 marks) What is a financial plan and what does a financial plan include? (5 marks) What are some factors that could affect a budget? (4 marks) Budget /Financial Plan Exercise Using the following information work out the answers for the questions below: (6 marks) 160- seat restaurant Average spent at lunch $16.50 Lunch seat turnover 80% Average spent at dinner $25.50 Dinner seat turnover 70% Restaurant open for lunch 260 days a year Restaurant open for dinner 312 days a year a. What are the projected sales for lunch? (2 marks) b. What are the projected sales for dinner? (2 marks) c. What are the projected total annual sales for the restaurant? (2 marks)