BABER MAKAYLA Budgets

Assessment 1 - SITXFIN005A Prepare and monitor budgets and SITXFIN004A Manage finances within a budget

What you have to do

This assessment consists of financial questions to be answered adequately to demonstrate your knowledge and understanding of the concepts of Preparing, monitoring and managing budgets in order to be deemed competent in these two units.

The following types of questions have been included:

· Fill-In-The-Blank

· Multiple Choice

· True/False

· Short answer questions

This quiz is ungraded. Your result is based on the evidence you provide to meet the criteria for competence as specified in the unit of competency and grading criteria. You will receive a result of Achieved Competency (AC) or Not yet Competent (NC).

Information on how to submit your assignment is located on the OLS OTEN website.

Part A - TRUE/FALSE

Consider the following statements and answer either true or false to indicate whether you believe these statements to be correct or incorrect.

Question 1:

Is the following statement true or false?

Budgets should be prepared by senior management and implemented without consulting any influencers.

Answer:

Question 2:

Is the following statement true or false?

Employees possess skills and information regarding the business operations, which are vital to the organisation and assist in the preparation of budgets.

Answer:

Question 3:

Is the following statement true or false?

Managers should motivate team members to participate and become involved in the budgeting process.

Answer:

Question 4:

Is the following statement true or false?

If workers are given responsibility in the preparation of budgets, then they will retain a sense of ownership, which will lead to increased efficiency.

Answer:

Question 5:

Is the following statement true or false?

Budget data information is based solely on looking at previous past results.

Answer

Question 6:

Is the following statement true or false?

Shareholders will expect the budget to reflect their interest in the financial outcomes of the business.

Answer:

Question 7:

Is the following statement true or false?

Employees in sales roles should show no interest in the sales team budget and whether it is achievable or not.

Answer:

Question 8:

Is the following statement true or false?

When budgets are NOT prepared cohesively and properly, the outcome can lead to lack of disciplinary control, ignorance of goals, and unrealistic budgetary data.

Answer:

Question 9:

Is the following statement true or false?

Flexible budgeting calculates budgeted costs on the basis of only one budgeted level of activity.

Answer:

Question 10:

Is the following statement true or false?

When budgeting for a new business or project, much of the budget information will come from your market research.

Answer

Question 11:

Is the following statement true or false?

There are two main types of functional budgets in a business. These are the operational budget and logistics budget.

Answer

Question 12:

Is the following statement true or false?

A cash flow budget is a prediction of future estimated cash flows, whereas a cash flow statement is a summary of past actual cash flow.

Answer

Part B Multiple Choice – circle or write the letter for the correct answer.

Question 13:

There are two (2) correct responses to this question.

The two main financial statements prepared by or on behalf of small businesses are the:

A balance sheet.

B cashbook

C profit and loss statement.

D bank reconciliation.

Answer

Question 14

The main types of budgets used by most tourism businesses are:

A Sales budget

B Expense budget

C Cash flow budget

D Wages budget

E All of the above

Answer

Question 15

Which type of budget can assist with managing payment outflows to creditors?

A Expense budget

B Sales budget

C Production budget

D Cash flow budget

Answer

Question 16:

Internal factors contributing to budget variances could be:

A Human resources

B Fuel prices

C Australian and global economic changes

D Changes to legislation.

Answer

Question 17:

A cash flow budget or forecast is used to determine the probability of having funds available every month to pay bills. What information does a cash flow forecast include:

A Inflows and outflows

B Assets and liabilities

C Profit and loss

D KPIs

Answer

Question 18:

Working capital refers to income that is:

A Invested in the stock market

B Used to supply funds for ongoing business costs

C From the sale of assets

D After tax profits.

Answer

Question 19:

The starting point for preparing a sales budget is information about;

A Industry averages

B Past results

C Market conditions

D General economic conditions

Answer

Question 20:

If your sales for 2008 are $4,600,000 and your commission is 12.5%, what would be your income?

a. $575,000

b. $57,500

c. $57,500,000

d. none of the above

Answer

Question 21:

Which of the following situations will result in an unfavourable variance?

A Budgeted income is less than actual income.

B Actual income is less than budgeted income.

C Budgeted expenses are more than actual expenses.

D Actual expenses are less than budgeted expenses.

Answer

Part C Short answer questions

Question 22

Explain what a Budget is?

Question 23

Identify two (2) roles of budgets and briefly explain how budgets achieve the outcomes sought:

Question 24

Identify three (3) types of budgets applicable to the tourism, hospitality and/or events industry, and whether it is a revenue or expense budget.

Question 25

Identify three (3) different types of information that may be required when preparing a budget:

Question 26

Identify the five (5) steps in the budgeting cycle;

Question 27

Identify two (2) advantages and two (2) disadvantages of budgets:

Question 28

Identify two (2) internal and two (2) external factors which may impact on a budget and budget development process.

Internal

External

Question 29

Improving budget performance is critical for business success.

i. Explain why it is important to improve budget performance

ii. How you would monitor income and expenditure

Assessment checklist

I have:

· Completed all the activities

· Attempted all the questions in this assessment and checked my answers before submitting it

· Saved a copy of the assessment