Assessment Details
Qualification Code/Title FNS50215 Diploma of Accounting
Assessment Type Assessment -01- Written Assessment Time allowed
Due Date Location AHIC Term / Year
Unit of Competency
National Code/Title FNSACC503 Manage Budget and Forecasts
Student Details
Student Name Student ID
Student Declaration: I declare that the work submitted is my own, and has not been copied or plagiarised from any person or source. Signature: ____________________________
Date: _____/______/__________
Assessor Details
Assessor’s Name
RESULTS (Please Circle) SATISFACTORY NOT SATISFACTORY
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Student Declaration: I declare that I have been assessed in this unit, and I have been advised of my result. I am also aware of my appeal rights.
Signature: _______________________________
Date: ______/_______/___________
Assessor Declaration: I declare that I have conducted a fair, valid, reliable and flexible assessment with this student, and I have provided appropriate feedback.
Signature: ________________________________________
Date: ______/_______/___________

Instructions to the Candidates
? This assessment is to be completed according to the instructions given below in this document.
? Should you not answer the tasks correctly, you will be given feedback on the results and gaps in knowledge. You will be entitled to one (1) resubmit in showing your competence with this unit.
? If you are not sure about any aspect of this assessment, please ask for clarification from your assessor.
? Please refer to the College re-submission and re-sit policy for more information.
? If you have questions and other concerns that may affect your performance in the Assessment, please inform the assessor immediately.
? Please read the Questions carefully then complete all Tasks.
? To be deemed competent for this unit you must achieve a satisfactory result with tasks of this Assessment along with a satisfactory result for the another Assessments.
? This is an Open book assessment which you will do in your own time but complete in the time designated by your assessor. Remember, that it must be your own work and if you use other sources then you must reference these appropriately
? This is Individual Assessments. Once you have completed the assessment, please provide the Hard copy of the Assessments to your Trainer/ Assessor.
? Plagiarism is copying someone else’s work and submitting it as your own. Any Plagiarism will result in a mark of Zero.
Question 1
Explain in 280–300 words the key purpose and objective of budgets and forecasts, including relevance of milestones and key performance indicators
Question 2
You have been asked to prepare the annual budget for a small business. The CEO has been helpful and shown you around. They have been responsible for the previous period’s budgets. You have been introduced to the three departmental managers of marketing, production and logistics. The marketing manager has given you a sales forecast that they are confident with.
a. Describe who else you will talk to in order to set the sales assumption forecast. How will you document this? How is the sales budget used to build the other budgets? (100–120 words)
b. What five steps does Shim propose for building the master budget?
c. Who is responsible and what standards for negotiations should be set during budget meetings with the managers and CEO? (120–150 words)
d. In what circumstances do NFPs compete for funding and what can influence the outcome of funding applications? (50–80 words)
Question 3
Identify and describe four types and sources of data and information required for budgeting and forecasting. Explain in 150–160 words how data is applied to budgeting and forecasting processes.
Question 4
Explain in 180–220 words what is meant by expenditure and revenue and identify five items relevant to budgeting and forecasting activities.
Question 5
How does:
a. Revenue forecasting affect the rest of the budget process? (100 words).
b. What are the limitations of revenue forecasting technique? (20–60 words).
c. How can this be countered? (20–60 words).
d. There are several managers—including sales, production and transport—in the company where you work who each understand the company’s budget objectives. As the head accountant you have been given last year’s master budget and told to use all sources of information in assembling objectives and assumptions for the next year’s expense budgets. (100–120 words)
Question 6
The amount of raw materials to be purchased is finalised including an accurate assumption from the production manager. Where else would you search for source documentation and what steps does it require to assemble a report about the behaviour of the budget especially the expected cost of raw materials? (80–100 words)
Question 7
Answer the following:
a. Explain in 120–150 words the differences between cash, revenue and expenditure. Provide an example of each category and which budget/s it is relevant to preparing.
b. You have discovered that controls implemented on the printing, postage and stationery account have made significant changes. Each month the savings made are $300. Use the first two columns to complete the worksheet.
Voyager Co.
Budget variance worksheet
31.3.2017
Month Existing Estimate Change to Effect on:
Income Expenses Cash Flow
July 700
Aug 750
Sept 800
Oct 900
Nov 950
Dec 800
Jan 800
Feb 800
Mar 800
Apr 800
May 800
June 800
Total 9,700
c. What is the total effect on cash flow? (20–50 words)
d. What effect will the control have on the sales budget? (20–50 words)
e. What effect will the control have on the financial position? (20–50 words)
Question 8
The CEO is trying to manage the level of motor vehicle costs which are putting pressure on the business. You have completed next year’s master budget including motor vehicle expenses.
a. What management controls would you suggest in your notes accompanying the master budget for approval? (100–120 words)
b. The CEO has asked for your input into establishing budget timelines. Briefly explain how you can use the concept of a budget calendar in describing reporting timelines to reply to the CEO. (150–200 words)
Question 9
What category of budgets are the governance board more likely to be interested in?
The two categories of budgets are operating and financial. The board is more likely to be interested in the financial budgets.
a. With a long-term view, which specific two budgets are the most relevant to the governing board and for what reason? (50–80 words)
b. A new governance board member is constantly asking the accountant questions about the motor vehicle expenses that are constantly over budget. They blame one of the business managers who they dislike and point to the fact that the manager has an unnecessary sports pack on their car. What type of budget does the motor vehicle expense belong to? Who is responsible for this budget? What steps would you take if you were the accountant? (50–80 words)
c. What does the budget audit examine? (50–80 words)
d. What does the budget audit detect and how frequently should it occur? (50–80 words)
e. What corrective action does the budget audit consider? (140–160 words)
Question 10
Which budgeted statement is the bank account reconciled to? What does reconciling the bank account reveal in regard to the cash flow budget? (50–80 words)
a. Build the projected revenue budget for the six months ending in December.
Apollo cash receipts
1.5.20XX–30.9.20XX
May June July August Sept. Oct. Nov. Dec.
3,000 5,000 7,000 5,000 5,000 4,500 3,000 3,000
Note:
Cash receipts are shown. Credit revenues are twice that of cash each month. Credit sales were 3,000 in March and 5,000 in April. Credit terms are 50% by end of the month; 35% by end of the next month balance by end of third month.
b. How is internal competition between projects/ departments competing for funding allocated and what role does the budgeted statement of financial performance play? (80–100 words)