ID Number Contact Number
Unit Code Unit Title
FNSACC414 Prepare financial statements for non-reporting entities
Title Due Date
Assignment 1 – Cash Flows and Management Reports
Extension Details (where applicable)
Extension Date for Submission Granted Until
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STUDENT SIGNATURE: DATE:
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Section 1 – Student and Assessor Instructions
Conditions This is an individual open book assignment which can be completed after you have finished up to and including chapters 2, 3 and 4.
Download the assessment document from Canvas and complete the questions. Save in Microsoft Word format and upload your assignment via Canvas.
If you have any questions about this assessment please ask your teacher prior to submission.
Task Overview and/or Description Instructions
Complete the two tasks at the end of the document using the information and stationery provided.
This assessment will demonstrate your understanding of the processes involved in preparing a Statement of Cash Flows and preparing a report for management based on your calculation and interpretation of rates and ratios.
• Collect data required to produce financial statements from sources in line with accounting standards
• Systematically code, classify, and check data for accuracy and reliability according to organisational policy and procedures
• Check internal and external financial data to confirm their consistency and accuracy
• Prepare financial statements using structure and format that comply with accounting standards and organisational requirements
• Review statements for errors and compliance with accounting standards and organisational procedures, and amend as required
• Obtain verification and authorisation from delegated persons. This means you need to check your work before submitting. By doing so you are agreeing and ‘signing’ off that everything is correct.
Submission Details Submit the following:
Task One: Completed Statement of Cash Flows.
Task Two: Completed Part A – Calculation of Ratios.
Task Two: Completed Part B – Report to Management.
Date due as per Unit Outline.
Section 2 – Assessment Criteria (Evidence to be Provided by the Student)
All of the required evidence within the marking guide listed below must be satisfactorily demonstrated for the task to be assessed as satisfactory.
Required Evidence Satisfactory Not Submitted Unsatisfactory
1 Collection of data required to produce financial statements from sources in line with accounting standards.
2 Systematic coding, classifying, and checking of data for accuracy and reliability according to organisational policy and procedures.
3 Checking of internal and external financial data to confirm their consistency and accuracy.
4 Preparation of financial statements using structure and format that comply with accounting standards and organisational requirements.
5 Reviewing of statements for errors and compliance with accounting standards and organisational procedures, and amending as required.
6 Obtaining verification and authorisation from delegated persons. This means you need to check your work before submitting. By doing so you are agreeing and ‘signing’ off that everything is correct.
Feedback to Student
Feedback will be provided to you in Canvas via comments.
Task One – Statement of Cash Flows
From the following information relating to Tamworth Flour Mills for the year ending 30 June 2019, prepare a Statement of Cash Flows using the stationery provided.
Bad Debts Expense $1,500
Cash Sales 77,000
Cash received from Accounts Receivable 253,000
Cash paid to Accounts Payable 154,000
Money borrowed from Colony Bank 25,000
Cash received from sale of Milling Equipment 94,160
Cash paid for purchase of new Milling Equipment 127,457
Interest Received 10,920
Interest payments on Colony Bank Loan 2,400
Wages paid 42,760
Cash payments for other expenses 66,000
Cash paid for new computer system 29,073
Cash introduced by owners 50,000
GST Paid to ATO 16,000
Repayment of loan from ABC Finance 10,000
Interest paid on ABC Finance Loan 700
Cash at Bank as at 1 July 2018 8,800
Cash at Bank as at 30 June 2019 70,490
Tamworth Flour Mills
Statement of Cash Flows for Financial Year Ended 30 June 2019
Cash flows from Operating Activities
Net Cash from Operating activities
Cash flows from Investing Activities
Net Cash from Investing activities
Cash flows from Financing Activities
Net Cash from Financing activities
Net Increase / decrease in cash
Cash at Bank as at 1 July 2018
Cash at Bank as at 30 June 2019
Task Two – Management Report
You have been provided with the following financial reports for Arrow Trading for the year ended 30 June 2019. You are required to provide a brief report to management as per the instructions.
Income Statement for year ended 30 June 2019
Sales (all credit) $485,000
Less Cost of Goods Sold
Less: Inventory 30/06/2019
Less Operating expenses 151,850
NET PROFIT 47,050
Balance Sheet as at 30 June 2019
Less allowance for doubtful debts 81,000
Prepaid expenses 800
Accrued revenue 900 144,500
Non- Current Assets
Plant and equipment 65000
Motor Vehicles 25000
Office Furniture 7,750 252,750
Total Assets 397,250
Bank Overdraft 20,000
Accounts Payable 55,500
GST Payable 3,000
Accrued Expenses 2,300 80,800
Non- Current Liabilities
Mortgage Loan 75,000 75,000
Total Liabilities 155,800
NET ASSETS 241,450
Capital – R. Arrow 1/7/18 232,400
Add: Net Profit 47,050
Less drawings 38,000
Total Owners Equity 241,450
Calculate the following ratios for the year ended 30 June 2019. Show your workings.
Gross profit rate 40%
Net profit rate 12%
Current ratio 1.6:1
Quick ratio 1.3:1
Inventory turnover rate (in days) 63
Accounts receivable collection period (in days) 52
For each of the rates calculated above:
• State whether the rate has increased, decreased or remained the same
• Provide management with 2 possible reasons for the change.
Gross Profit rate
Net Profit rate
Accounts Receivable collection period