Assessment Details
Qualification Code/Title FNS50215 Diploma of Accounting
Assessment Type Assessment -02-Project 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
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Date: _____/______/__________
Assessor Details
Assessor’s Name
RESULTS (Please Circle) SATISFACTORY NOT SATISFACTORY
Feedback to student:
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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 Project 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.

Part 1
You have been asked by the owner of a new consultancy called Voyager to prepare the master budget. The consultancy consists of the owner who charges out at $68 per hour and the junior staff who are charged out at $42 per hour. The owner has advised you that the following hours are forecast for each quarter.
The consultancy has a credit system of payments with 60% of payment received the quarter in which they are earned and the remaining 40% earned the following month. The opening accounts receivable is $13,200 incl GST. The GST is accounted for on an accrual basis.
1. Prepare a quarterly revenue receipts forecast and cash collections forecast for the next financial year.
Hours September December March June
Senior 250 230 230 230
Junior 210 220 210 220
Voyager Co
Revenue Receipts Forecast
30-June
Hours Receivables
Quarter Junior Senior Total Junior @ $42/hr Senior @ $68/hr Total GST Total GST inc
September
December
March
June
Voyager Co
Cash Collections Forecast
30-June
Quarter Receivables September December March June
Opening
September
December
March
June
Closing
2. The owner will purchase a new vehicle in the September quarter for $27,500. In December they will purchase photocopiers for $5,500 and a computer system for $5,500 with an upgrade in March for a further $2,750. Each item is inclusive of GST. Prepare the Capital Expense Budget for the financial year.
Voyager Co.
Capital Expenditure Budget
30 June
September December March June Total GST
Car
Photocopier
Computer
Total (net GST)
GST
3. The information in the table is based on source documentation from the company’s previous operations. GST Expenses are shown.
September December March June
Motor vehicle 1,300 1,495 300 450
Printing 200 50 200 50
Electricity 600 555 500 500
Rent 4,500 4,500 4,500 4,500
Depreciation is $700 per quarter and tax payable at 30% of net profit per quarter. Wages for the senior staff are $8,000 per quarter and junior $5,000.
Complete the expense budget, budgeted statement of financial performance; you will need to add the non GST items to the expense budget, and the cash flow budget which has an opening cash balance of $42,000. The opening GST liability is 2,000 and the opening PAYG tax instalment is 2,500.
Voyager Co.
Expense Budget
30 June
September December March June
Cash Expenses
Motor vehicle
Printing
Electricity
Rent
Sub Total GST inclusive
GST
Net of GST
Wages Senior
Wages Junior
Subtotal Cash Items
Depreciation
Total
Voyager Co.
Budget statement of financial performance
30 June
September December March June Liability
Service revenue
Less Expenses
Subtotal
Income tax 30%
Net Profit
Voyager Co
GST Budget
30 June
September December March June Liability
GST Collected on Sales
GST Paid on Expenses
GST Paid on Capital Acquisitions
Net GST
Voyager Co.
Budget statement of cash flows
30 June
September December March June
Opening Cash
Add Collections from revenues
Total cash available
Less estimated cash payments
Cash Payments in expense budget
Capital Expenditures
GST Payments*
Tax payments
Total
Closing cash balance
4. Use the cash budget to prepare a graph of quarterly revenue received, payments made and closing cash position.

5. Explain the graph by answering:
a. Which month has the highest payments, what causes this?
b. What advice would you give about the purchase of capital items?
c. Approximately what effect would not be purchasing the capital items have?
d. Which month has the highest revenue received?
e. Describe the position of closing cash throughout the year. The owner realises that
there will be significant expenses in this first year of operations. Identify in which quarter the milestone of revenues exceeding expenditures occurs. What effect does this have on cash?
f. What advice would you give about the paying of a $1,000 bonus to the junior staff in June promised in the September quarter based on the staff’s performance and the financial performance of the business for the year? (200–220 words)
6. Suppose that Voyager has non-current assets valued at $55,000 with accumulated depreciation at the beginning of the year of 20,000. Use the depreciation expense for the forecast year and other relevant items to complete the budgeted statement of financial position as at 30th June. Assume no depreciation on new non-current assets and all equity is represented by retained profits.
Voyager Co.
Budget statement of financial position
As at 30 June
Cash at bank
Accounts Receivable
Total Current assets
Non-Current
Less depreciation
Car
Computer systems
Photocopier
Total Assets
Liabilities
GST
TAX
Total Liabilities
Net assets
Owner’s Equity
Retained Profits
7. What makes setting budget account assumptions time-consuming for Voyager and what must it consider? Discuss in 50–80 words.
Part 2
1. Describe in 150–200 words how budget assumptions operate over time, what makes the best budget assumptions and what happens when they become invalid.
2. Suppose several additional junior staff are employed in subsequent years after a new business is established. The owner notices a large increase in the motor vehicle expense account. What changes to assumptions or controls would you recommend? (80–120 words)
3. Explain in 50–80 words how organisational goals determine the master budget.
4. Briefly describe (30–50 words) what quantitative and qualitative data are in regard to budgeting.
5. What is the budget calendar? (50–80 words)
6. When researching information to complete the cash flow budget, what needs to be considered? (80–100 words)
7. Which management actions can affect the cash flow budget? (80–100 words)
8. How can decision-makers compare projects and what criteria might they use? (80–100 words)
9. What does the budget audit examine? (50–80 words)
10. What does the budget audit detect and how frequently should it occur? (50–80 words)
11. What corrective action does the budget audit consider? (100–130 words)
12. When working to complete budget reporting on time, how should accountants approach new project reporting in a manufacturing business? (80–100 words)
13. How should budget assumptions be dealt with to guard against unethical assumptions? (50–80 words)
14. Who is responsible for budget management? (30–50 words)
15. Who is responsible for oversight of the budget? (30–50 words)
16. In order to be effective, which type of executives should make up the majority of the audit committee members? (30–50 words)