CRN Manage Finances (ACCT342 – BSBFIM601A)

Assessment Coversheet
Student Name CIT Number
Competency Title, Code and Banner Code
CRN Manage Finances (ACCT342 – BSBFIM601A)
Managing Finances (HOTL168C – BSBFIM601A)
43348 / 43870 / 43265
Assessment Type ? Written ? Case Study ? Project ? Presentation ? Other
Assessment Name Assessment Task 2 – Financial statement analysis
Assessment Date • Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8
• Assessment task 2b (FINAL) is to be uploaded into eLearn by
Thursday 23.4.20 (Week 10)
Student Statement: This assessment is my own work. Any ideas and comments made by other people have been acknowledged. I understand that by emailing or submitting this assessment electronically, I agree to this statement.
Student Signature Date
PRIVACY DISCLAIMER: CIT is collecting your personal information for assessment purposes. The information will only be used in accordance with the CIT Privacy Policy.
Assessor Feedback
Feedback will be provided in eLearn
? Student provided with feedback
Attempt 1 ? Satisfactory
? Not Yet Satisfactory
Date / /
Attempt 2 ? Satisfactory
? Not Yet Satisfactory
Date / /
Assessor Name Philip McGuire Assessor Signature
Note to Assessor: Please record any reasonable adjustment that has occurred for this assessment.
Instructions to Assessor
Work, Health and Safety: A work health and safety check of the assessment environment is to be conducted prior to the assessment and any hazards addressed appropriately.
List the time, materials provided and assessment range and conditions on the next page
These sections should be detailed enough for multiple assessors to consistently implement the assessment and include details of location, time restrictions, level of assistance permitted (if any), WHS, environment protocols, etc. The student should have access to techniques, procedures, information, resources and aids which would normally be available in the workplace. Include if open or closed book.
Materials to be supplied may include: assessment paper, site plan, text, internet access, etc.
Information for Students: You may have two (2) attempts for this assessment.
• If your first attempt is not successful, your teacher will discuss your results with you and will arrange a second attempt.
• If your second attempt is not successful, you will be required to re-enrol in this unit.
Only one re-assessment attempt will be granted for each assessment item.
Time Allowed: Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8. Assessment task 2b (FINAL) is to be uploaded into eLearn by
(Week 10).
Materials Provided: Assessment paper, materials on eLearn
Assessment Range and Conditions: This is a take home assignment
Assessment Criteria: To achieve a Satisfactory result, your assessor will be looking for your ability to demonstrate the key skills/tasks/knowledge detailed in the Assessment Task to industry standard. Your submission should be of a professional standard, using full sentences and paragraphs. In addition, the assessment criteria for each part of this assessment is detailed below.
PART A
• Identify the meaning of each ratio and describe the factors which impact each ratio
• Improvement or deterioration in each ratio correctly identified
• Two reasons for the change in each ratio are correctly identified
• Two changes to business practices which would improve or further improve the ratio correctly identified
PART B
• Appropriate recommendations provided regarding the record keeping and internal controls of the business
PART C
• Two significant business issues are correctly identified
• Appropriate recommendations provided to address the identified business issues and ensure the financial viability of the business
See next page for specific instructions for this assessment
Assessment Task Instructions for Students
The following financial information is provided:
The Kimchi Kitchen
INCOME STATEMENT
For the year ended 30 June 2020
2020 2019 Variance
$ $ $
SALES REVENUE 219,000 237,500 (18,500)
Less Cost of Goods Sold 85,690 90,650 4,960
GROSS PROFIT 133,310 146,850 (13,540)
Less OTHER OPERATING EXPENSES
Accounting fees 2,875 2,500 (375)
Advertising 2,080 3,200 1,120
Bank charges 355 320 (35)
Depreciation 1,760 1,600 (160)
Electricity 4,480 3,200 (1,280)
Insurance 1,785 1,700 (85)
Interest 650 700 50
Rent 18000 4,500 (13,500)
Stationery 561 550 (11)
Telephone 2,415 2,300 (115)
Wages 88,000 84,250 (3,750)
Total Operating expenses 122,961 104,820 (18,141)
NET PROFIT (LOSS) 10349 42,030 (31,681)
Note: All sales are on cash
Note: Favourable variances are reported as a positive. Unfavourable variances are reported as a negative
The Kimchi Kitchen
BALANCE SHEET
As at 30 June 2020
2020 2019 Variance
$ $ $
ASSETS
Current Assets
Cash at bank (20,011) 78,380 (98,391)
Debtors 1,500 5,500 – (4,000)
Inventory 15,411 15,411 –
Total Current Assets (3,100) 99,291 (102,391)
Non Current Assets
Property, plant & equipment 163,500 123,500 40,000
Less Accumulated Depreciation 26,460 24,700 (1,760)
Total Non Current Assets 137,040 98,800 38,240
TOTAL ASSETS 133,940 198,091 (64,151)
LIABILITIES
Current Liabilities
Creditors 500 5,500 – 5,000
Total Current Liabilities 500 5,500 – 5,000
Non Current Liabilities
Term Loan 4,800 9,300 4,500
Total Non Current Liabilities 4,800 9,300 4,500
TOTAL LIABILITIES 5,300 14,800 9,500
NET ASSETS 128,640 183,291 (54,651)
Represented by
OWNER’S EQUITY
opening balance 183,291 226,261 – (42,970)
Net Profit for Year 10,349 42,030 (31,681)
193,640 268,291 (74,651)
Less Drawings 65,000 85,000 20,000
TOTAL OWNER’S EQUITY 128,640 183,291 (54,651)
Favourable variances are shown as a positive. Unfavourable variances are shown as a negative
The Kimchi Kitchen
CASHFLOW STATEMENT
For the year ended 30 June 2020
2020 2019 2018
$ $ $
CASH- FLOWS FROM OPERATING ACTIVITIES
Receipts
Sales 219,000 237,500 294,134
Debtors collected 4,000
GST collected on sales 21,900 23,750 29,413
Total receipts 244,900 261,250 323,547
less Payments
Accounting fees 2,875 2,500 2,000
Advertising 2,080 3,200 4,000
Bank charges 355 320 270
Cost of Goods Sold 85,690 90,650 88,240
Electricity 4,480 3,200 3,100
Creditors paid 5,000
GST paid on purchases 15,789 11,580 16,069
Net GST paid to the ATO 6,111 12,170 13,344
Insurance 1,785 1,700 1,650
Interest 650 700 700
Rent 18,000 4,500 4,200
Stationery 561 550 500
Telephone 2,415 2,300 2,000
Wages 88,000 84,250 89,366
Total payments 233,791 217,620 225,439
Net cash-flows from operating activities 11,109 43,630 98,108
CASH- FLOWS FROM INVESTING ACTIVITIES
Receipts – – –
less Payments
Asset purchases 40,000 7,200 55,000
Total payments 40,000 7,200 55,000
Net cash-flows from investing activities (40,000) (7,200) (55,000)

CASH- FLOWS FROM FINANCING ACTIVITIES
Receipts
Capital contributed by owner – 8,000 25,000
Total receipts – 8,000 25,000
less Payments
Drawings 65,000 85,000 100,000
Loan payments 4,500 4,500 4,500
Total payments 69,500 89,500 104,500
Net cash-flows from financing activities (69,500) (81,500) (79,500)

NET CASH FLOW (98,391) (45,070) (36,392)

Opening cash position 78,380 123,450 159,842

Closing cash position (20,011) 78,380 123,450

Based on the financial statements you must calculate the following ratios:
Ratio Ratio Formula 30.6.20 30.6.19
Gross profit ratio
Net profit ratio
Return on Owners equity ratio
Current Ratio
Operating Expense Ratio
Liquidity Ratio
PART A
For each of the ratios above:
1. Calculate the ratios for 30.6.19 & 30.6.20
2. Write one short paragraph on the meaning each ratio and the factors which affect the ratios for this business.
3. Detail whether each ratio improved or deteriorated compared to the prior year (one sentence)
4. Describe two things that the business could be doing which is causing the change in
each ratio from the prior year to the current year (one to two paragraphs). Read the financial statements to determine which specific areas caused the change.
5. Recommend two changes to business practices which the business could implement to improve or further improve each ratio and financial position of the business. Ensure these recommendations refer to the issues identified in point 3 above (one to two paragraphs).
PART B
The business is using manual cash books and you are concerned about the lengthy delay in preparing the financial statements. You are also worried that the reports are missing transactions and stock records may be incorrect.
What improvements would you recommend regarding the record keeping and internal controls of the business (think about the accounting system and systems and controls that could be put in place to address these concerns. Think about your responses in Part A). Write one to two paragraphs.
PART C
In one to two paragraphs, identify two main problem areas for the business and provide two recommendations to ensure the overall financial viability of the business. You may draw on your analysis and responses above to determine your two main recommendations. Write one to two paragraphsAssessment Coversheet
Student Name CIT Number
Competency Title, Code and Banner Code
CRN Manage Finances (ACCT342 – BSBFIM601A)
Managing Finances (HOTL168C – BSBFIM601A)
43348 / 43870 / 43265
Assessment Type ? Written ? Case Study ? Project ? Presentation ? Other
Assessment Name Assessment Task 2 – Financial statement analysis
Assessment Date • Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8
• Assessment task 2b (FINAL) is to be uploaded into eLearn by
Thursday 23.4.20 (Week 10)
Student Statement: This assessment is my own work. Any ideas and comments made by other people have been acknowledged. I understand that by emailing or submitting this assessment electronically, I agree to this statement.
Student Signature Date
PRIVACY DISCLAIMER: CIT is collecting your personal information for assessment purposes. The information will only be used in accordance with the CIT Privacy Policy.
Assessor Feedback
Feedback will be provided in eLearn
? Student provided with feedback
Attempt 1 ? Satisfactory
? Not Yet Satisfactory
Date / /
Attempt 2 ? Satisfactory
? Not Yet Satisfactory
Date / /
Assessor Name Philip McGuire Assessor Signature
Note to Assessor: Please record any reasonable adjustment that has occurred for this assessment.
Instructions to Assessor
Work, Health and Safety: A work health and safety check of the assessment environment is to be conducted prior to the assessment and any hazards addressed appropriately.
List the time, materials provided and assessment range and conditions on the next page
These sections should be detailed enough for multiple assessors to consistently implement the assessment and include details of location, time restrictions, level of assistance permitted (if any), WHS, environment protocols, etc. The student should have access to techniques, procedures, information, resources and aids which would normally be available in the workplace. Include if open or closed book.
Materials to be supplied may include: assessment paper, site plan, text, internet access, etc.
Information for Students: You may have two (2) attempts for this assessment.
• If your first attempt is not successful, your teacher will discuss your results with you and will arrange a second attempt.
• If your second attempt is not successful, you will be required to re-enrol in this unit.
Only one re-assessment attempt will be granted for each assessment item.
Time Allowed: Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8. Assessment task 2b (FINAL) is to be uploaded into eLearn by
(Week 10).
Materials Provided: Assessment paper, materials on eLearn
Assessment Range and Conditions: This is a take home assignment
Assessment Criteria: To achieve a Satisfactory result, your assessor will be looking for your ability to demonstrate the key skills/tasks/knowledge detailed in the Assessment Task to industry standard. Your submission should be of a professional standard, using full sentences and paragraphs. In addition, the assessment criteria for each part of this assessment is detailed below.
PART A
• Identify the meaning of each ratio and describe the factors which impact each ratio
• Improvement or deterioration in each ratio correctly identified
• Two reasons for the change in each ratio are correctly identified
• Two changes to business practices which would improve or further improve the ratio correctly identified
PART B
• Appropriate recommendations provided regarding the record keeping and internal controls of the business
PART C
• Two significant business issues are correctly identified
• Appropriate recommendations provided to address the identified business issues and ensure the financial viability of the business
See next page for specific instructions for this assessment
Assessment Task Instructions for Students
The following financial information is provided:
The Kimchi Kitchen
INCOME STATEMENT
For the year ended 30 June 2020
2020 2019 Variance
$ $ $
SALES REVENUE 219,000 237,500 (18,500)
Less Cost of Goods Sold 85,690 90,650 4,960
GROSS PROFIT 133,310 146,850 (13,540)
Less OTHER OPERATING EXPENSES
Accounting fees 2,875 2,500 (375)
Advertising 2,080 3,200 1,120
Bank charges 355 320 (35)
Depreciation 1,760 1,600 (160)
Electricity 4,480 3,200 (1,280)
Insurance 1,785 1,700 (85)
Interest 650 700 50
Rent 18000 4,500 (13,500)
Stationery 561 550 (11)
Telephone 2,415 2,300 (115)
Wages 88,000 84,250 (3,750)
Total Operating expenses 122,961 104,820 (18,141)
NET PROFIT (LOSS) 10349 42,030 (31,681)
Note: All sales are on cash
Note: Favourable variances are reported as a positive. Unfavourable variances are reported as a negative
The Kimchi Kitchen
BALANCE SHEET
As at 30 June 2020
2020 2019 Variance
$ $ $
ASSETS
Current Assets
Cash at bank (20,011) 78,380 (98,391)
Debtors 1,500 5,500 – (4,000)
Inventory 15,411 15,411 –
Total Current Assets (3,100) 99,291 (102,391)
Non Current Assets
Property, plant & equipment 163,500 123,500 40,000
Less Accumulated Depreciation 26,460 24,700 (1,760)
Total Non Current Assets 137,040 98,800 38,240
TOTAL ASSETS 133,940 198,091 (64,151)
LIABILITIES
Current Liabilities
Creditors 500 5,500 – 5,000
Total Current Liabilities 500 5,500 – 5,000
Non Current Liabilities
Term Loan 4,800 9,300 4,500
Total Non Current Liabilities 4,800 9,300 4,500
TOTAL LIABILITIES 5,300 14,800 9,500
NET ASSETS 128,640 183,291 (54,651)
Represented by
OWNER’S EQUITY
opening balance 183,291 226,261 – (42,970)
Net Profit for Year 10,349 42,030 (31,681)
193,640 268,291 (74,651)
Less Drawings 65,000 85,000 20,000
TOTAL OWNER’S EQUITY 128,640 183,291 (54,651)
Favourable variances are shown as a positive. Unfavourable variances are shown as a negative
The Kimchi Kitchen
CASHFLOW STATEMENT
For the year ended 30 June 2020
2020 2019 2018
$ $ $
CASH- FLOWS FROM OPERATING ACTIVITIES
Receipts
Sales 219,000 237,500 294,134
Debtors collected 4,000
GST collected on sales 21,900 23,750 29,413
Total receipts 244,900 261,250 323,547
less Payments
Accounting fees 2,875 2,500 2,000
Advertising 2,080 3,200 4,000
Bank charges 355 320 270
Cost of Goods Sold 85,690 90,650 88,240
Electricity 4,480 3,200 3,100
Creditors paid 5,000
GST paid on purchases 15,789 11,580 16,069
Net GST paid to the ATO 6,111 12,170 13,344
Insurance 1,785 1,700 1,650
Interest 650 700 700
Rent 18,000 4,500 4,200
Stationery 561 550 500
Telephone 2,415 2,300 2,000
Wages 88,000 84,250 89,366
Total payments 233,791 217,620 225,439
Net cash-flows from operating activities 11,109 43,630 98,108
CASH- FLOWS FROM INVESTING ACTIVITIES
Receipts – – –
less Payments
Asset purchases 40,000 7,200 55,000
Total payments 40,000 7,200 55,000
Net cash-flows from investing activities (40,000) (7,200) (55,000)

CASH- FLOWS FROM FINANCING ACTIVITIES
Receipts
Capital contributed by owner – 8,000 25,000
Total receipts – 8,000 25,000
less Payments
Drawings 65,000 85,000 100,000
Loan payments 4,500 4,500 4,500
Total payments 69,500 89,500 104,500
Net cash-flows from financing activities (69,500) (81,500) (79,500)

NET CASH FLOW (98,391) (45,070) (36,392)

Opening cash position 78,380 123,450 159,842

Closing cash position (20,011) 78,380 123,450

Based on the financial statements you must calculate the following ratios:
Ratio Ratio Formula 30.6.20 30.6.19
Gross profit ratio
Net profit ratio
Return on Owners equity ratio
Current Ratio
Operating Expense Ratio
Liquidity Ratio
PART A
For each of the ratios above:
1. Calculate the ratios for 30.6.19 & 30.6.20
2. Write one short paragraph on the meaning each ratio and the factors which affect the ratios for this business.
3. Detail whether each ratio improved or deteriorated compared to the prior year (one sentence)
4. Describe two things that the business could be doing which is causing the change in
each ratio from the prior year to the current year (one to two paragraphs). Read the financial statements to determine which specific areas caused the change.
5. Recommend two changes to business practices which the business could implement to improve or further improve each ratio and financial position of the business. Ensure these recommendations refer to the issues identified in point 3 above (one to two paragraphs).
PART B
The business is using manual cash books and you are concerned about the lengthy delay in preparing the financial statements. You are also worried that the reports are missing transactions and stock records may be incorrect.
What improvements would you recommend regarding the record keeping and internal controls of the business (think about the accounting system and systems and controls that could be put in place to address these concerns. Think about your responses in Part A). Write one to two paragraphs.
PART C
In one to two paragraphs, identify two main problem areas for the business and provide two recommendations to ensure the overall financial viability of the business. You may draw on your analysis and responses above to determine your two main recommendations. Write one to two paragraphsAssessment Coversheet
Student Name CIT Number
Competency Title, Code and Banner Code
CRN Manage Finances (ACCT342 – BSBFIM601A)
Managing Finances (HOTL168C – BSBFIM601A)
43348 / 43870 / 43265
Assessment Type ? Written ? Case Study ? Project ? Presentation ? Other
Assessment Name Assessment Task 2 – Financial statement analysis
Assessment Date • Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8
• Assessment task 2b (FINAL) is to be uploaded into eLearn by
Thursday 23.4.20 (Week 10)
Student Statement: This assessment is my own work. Any ideas and comments made by other people have been acknowledged. I understand that by emailing or submitting this assessment electronically, I agree to this statement.
Student Signature Date
PRIVACY DISCLAIMER: CIT is collecting your personal information for assessment purposes. The information will only be used in accordance with the CIT Privacy Policy.
Assessor Feedback
Feedback will be provided in eLearn
? Student provided with feedback
Attempt 1 ? Satisfactory
? Not Yet Satisfactory
Date / /
Attempt 2 ? Satisfactory
? Not Yet Satisfactory
Date / /
Assessor Name Philip McGuire Assessor Signature
Note to Assessor: Please record any reasonable adjustment that has occurred for this assessment.
Instructions to Assessor
Work, Health and Safety: A work health and safety check of the assessment environment is to be conducted prior to the assessment and any hazards addressed appropriately.
List the time, materials provided and assessment range and conditions on the next page
These sections should be detailed enough for multiple assessors to consistently implement the assessment and include details of location, time restrictions, level of assistance permitted (if any), WHS, environment protocols, etc. The student should have access to techniques, procedures, information, resources and aids which would normally be available in the workplace. Include if open or closed book.
Materials to be supplied may include: assessment paper, site plan, text, internet access, etc.
Information for Students: You may have two (2) attempts for this assessment.
• If your first attempt is not successful, your teacher will discuss your results with you and will arrange a second attempt.
• If your second attempt is not successful, you will be required to re-enrol in this unit.
Only one re-assessment attempt will be granted for each assessment item.
Time Allowed: Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8. Assessment task 2b (FINAL) is to be uploaded into eLearn by
(Week 10).
Materials Provided: Assessment paper, materials on eLearn
Assessment Range and Conditions: This is a take home assignment
Assessment Criteria: To achieve a Satisfactory result, your assessor will be looking for your ability to demonstrate the key skills/tasks/knowledge detailed in the Assessment Task to industry standard. Your submission should be of a professional standard, using full sentences and paragraphs. In addition, the assessment criteria for each part of this assessment is detailed below.
PART A
• Identify the meaning of each ratio and describe the factors which impact each ratio
• Improvement or deterioration in each ratio correctly identified
• Two reasons for the change in each ratio are correctly identified
• Two changes to business practices which would improve or further improve the ratio correctly identified
PART B
• Appropriate recommendations provided regarding the record keeping and internal controls of the business
PART C
• Two significant business issues are correctly identified
• Appropriate recommendations provided to address the identified business issues and ensure the financial viability of the business
See next page for specific instructions for this assessment
Assessment Task Instructions for Students
The following financial information is provided:
The Kimchi Kitchen
INCOME STATEMENT
For the year ended 30 June 2020
2020 2019 Variance
$ $ $
SALES REVENUE 219,000 237,500 (18,500)
Less Cost of Goods Sold 85,690 90,650 4,960
GROSS PROFIT 133,310 146,850 (13,540)
Less OTHER OPERATING EXPENSES
Accounting fees 2,875 2,500 (375)
Advertising 2,080 3,200 1,120
Bank charges 355 320 (35)
Depreciation 1,760 1,600 (160)
Electricity 4,480 3,200 (1,280)
Insurance 1,785 1,700 (85)
Interest 650 700 50
Rent 18000 4,500 (13,500)
Stationery 561 550 (11)
Telephone 2,415 2,300 (115)
Wages 88,000 84,250 (3,750)
Total Operating expenses 122,961 104,820 (18,141)
NET PROFIT (LOSS) 10349 42,030 (31,681)
Note: All sales are on cash
Note: Favourable variances are reported as a positive. Unfavourable variances are reported as a negative
The Kimchi Kitchen
BALANCE SHEET
As at 30 June 2020
2020 2019 Variance
$ $ $
ASSETS
Current Assets
Cash at bank (20,011) 78,380 (98,391)
Debtors 1,500 5,500 – (4,000)
Inventory 15,411 15,411 –
Total Current Assets (3,100) 99,291 (102,391)
Non Current Assets
Property, plant & equipment 163,500 123,500 40,000
Less Accumulated Depreciation 26,460 24,700 (1,760)
Total Non Current Assets 137,040 98,800 38,240
TOTAL ASSETS 133,940 198,091 (64,151)
LIABILITIES
Current Liabilities
Creditors 500 5,500 – 5,000
Total Current Liabilities 500 5,500 – 5,000
Non Current Liabilities
Term Loan 4,800 9,300 4,500
Total Non Current Liabilities 4,800 9,300 4,500
TOTAL LIABILITIES 5,300 14,800 9,500
NET ASSETS 128,640 183,291 (54,651)
Represented by
OWNER’S EQUITY
opening balance 183,291 226,261 – (42,970)
Net Profit for Year 10,349 42,030 (31,681)
193,640 268,291 (74,651)
Less Drawings 65,000 85,000 20,000
TOTAL OWNER’S EQUITY 128,640 183,291 (54,651)
Favourable variances are shown as a positive. Unfavourable variances are shown as a negative
The Kimchi Kitchen
CASHFLOW STATEMENT
For the year ended 30 June 2020
2020 2019 2018
$ $ $
CASH- FLOWS FROM OPERATING ACTIVITIES
Receipts
Sales 219,000 237,500 294,134
Debtors collected 4,000
GST collected on sales 21,900 23,750 29,413
Total receipts 244,900 261,250 323,547
less Payments
Accounting fees 2,875 2,500 2,000
Advertising 2,080 3,200 4,000
Bank charges 355 320 270
Cost of Goods Sold 85,690 90,650 88,240
Electricity 4,480 3,200 3,100
Creditors paid 5,000
GST paid on purchases 15,789 11,580 16,069
Net GST paid to the ATO 6,111 12,170 13,344
Insurance 1,785 1,700 1,650
Interest 650 700 700
Rent 18,000 4,500 4,200
Stationery 561 550 500
Telephone 2,415 2,300 2,000
Wages 88,000 84,250 89,366
Total payments 233,791 217,620 225,439
Net cash-flows from operating activities 11,109 43,630 98,108
CASH- FLOWS FROM INVESTING ACTIVITIES
Receipts – – –
less Payments
Asset purchases 40,000 7,200 55,000
Total payments 40,000 7,200 55,000
Net cash-flows from investing activities (40,000) (7,200) (55,000)

CASH- FLOWS FROM FINANCING ACTIVITIES
Receipts
Capital contributed by owner – 8,000 25,000
Total receipts – 8,000 25,000
less Payments
Drawings 65,000 85,000 100,000
Loan payments 4,500 4,500 4,500
Total payments 69,500 89,500 104,500
Net cash-flows from financing activities (69,500) (81,500) (79,500)

NET CASH FLOW (98,391) (45,070) (36,392)

Opening cash position 78,380 123,450 159,842

Closing cash position (20,011) 78,380 123,450

Based on the financial statements you must calculate the following ratios:
Ratio Ratio Formula 30.6.20 30.6.19
Gross profit ratio
Net profit ratio
Return on Owners equity ratio
Current Ratio
Operating Expense Ratio
Liquidity Ratio
PART A
For each of the ratios above:
1. Calculate the ratios for 30.6.19 & 30.6.20
2. Write one short paragraph on the meaning each ratio and the factors which affect the ratios for this business.
3. Detail whether each ratio improved or deteriorated compared to the prior year (one sentence)
4. Describe two things that the business could be doing which is causing the change in
each ratio from the prior year to the current year (one to two paragraphs). Read the financial statements to determine which specific areas caused the change.
5. Recommend two changes to business practices which the business could implement to improve or further improve each ratio and financial position of the business. Ensure these recommendations refer to the issues identified in point 3 above (one to two paragraphs).
PART B
The business is using manual cash books and you are concerned about the lengthy delay in preparing the financial statements. You are also worried that the reports are missing transactions and stock records may be incorrect.
What improvements would you recommend regarding the record keeping and internal controls of the business (think about the accounting system and systems and controls that could be put in place to address these concerns. Think about your responses in Part A). Write one to two paragraphs.
PART C
In one to two paragraphs, identify two main problem areas for the business and provide two recommendations to ensure the overall financial viability of the business. You may draw on your analysis and responses above to determine your two main recommendations. Write one to two paragraphsAssessment Coversheet
Student Name CIT Number
Competency Title, Code and Banner Code
CRN Manage Finances (ACCT342 – BSBFIM601A)
Managing Finances (HOTL168C – BSBFIM601A)
43348 / 43870 / 43265
Assessment Type ? Written ? Case Study ? Project ? Presentation ? Other
Assessment Name Assessment Task 2 – Financial statement analysis
Assessment Date • Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8
• Assessment task 2b (FINAL) is to be uploaded into eLearn by
Thursday 23.4.20 (Week 10)
Student Statement: This assessment is my own work. Any ideas and comments made by other people have been acknowledged. I understand that by emailing or submitting this assessment electronically, I agree to this statement.
Student Signature Date
PRIVACY DISCLAIMER: CIT is collecting your personal information for assessment purposes. The information will only be used in accordance with the CIT Privacy Policy.
Assessor Feedback
Feedback will be provided in eLearn
? Student provided with feedback
Attempt 1 ? Satisfactory
? Not Yet Satisfactory
Date / /
Attempt 2 ? Satisfactory
? Not Yet Satisfactory
Date / /
Assessor Name Philip McGuire Assessor Signature
Note to Assessor: Please record any reasonable adjustment that has occurred for this assessment.
Instructions to Assessor
Work, Health and Safety: A work health and safety check of the assessment environment is to be conducted prior to the assessment and any hazards addressed appropriately.
List the time, materials provided and assessment range and conditions on the next page
These sections should be detailed enough for multiple assessors to consistently implement the assessment and include details of location, time restrictions, level of assistance permitted (if any), WHS, environment protocols, etc. The student should have access to techniques, procedures, information, resources and aids which would normally be available in the workplace. Include if open or closed book.
Materials to be supplied may include: assessment paper, site plan, text, internet access, etc.
Information for Students: You may have two (2) attempts for this assessment.
• If your first attempt is not successful, your teacher will discuss your results with you and will arrange a second attempt.
• If your second attempt is not successful, you will be required to re-enrol in this unit.
Only one re-assessment attempt will be granted for each assessment item.
Time Allowed: Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8. Assessment task 2b (FINAL) is to be uploaded into eLearn by
(Week 10).
Materials Provided: Assessment paper, materials on eLearn
Assessment Range and Conditions: This is a take home assignment
Assessment Criteria: To achieve a Satisfactory result, your assessor will be looking for your ability to demonstrate the key skills/tasks/knowledge detailed in the Assessment Task to industry standard. Your submission should be of a professional standard, using full sentences and paragraphs. In addition, the assessment criteria for each part of this assessment is detailed below.
PART A
• Identify the meaning of each ratio and describe the factors which impact each ratio
• Improvement or deterioration in each ratio correctly identified
• Two reasons for the change in each ratio are correctly identified
• Two changes to business practices which would improve or further improve the ratio correctly identified
PART B
• Appropriate recommendations provided regarding the record keeping and internal controls of the business
PART C
• Two significant business issues are correctly identified
• Appropriate recommendations provided to address the identified business issues and ensure the financial viability of the business
See next page for specific instructions for this assessment
Assessment Task Instructions for Students
The following financial information is provided:
The Kimchi Kitchen
INCOME STATEMENT
For the year ended 30 June 2020
2020 2019 Variance
$ $ $
SALES REVENUE 219,000 237,500 (18,500)
Less Cost of Goods Sold 85,690 90,650 4,960
GROSS PROFIT 133,310 146,850 (13,540)
Less OTHER OPERATING EXPENSES
Accounting fees 2,875 2,500 (375)
Advertising 2,080 3,200 1,120
Bank charges 355 320 (35)
Depreciation 1,760 1,600 (160)
Electricity 4,480 3,200 (1,280)
Insurance 1,785 1,700 (85)
Interest 650 700 50
Rent 18000 4,500 (13,500)
Stationery 561 550 (11)
Telephone 2,415 2,300 (115)
Wages 88,000 84,250 (3,750)
Total Operating expenses 122,961 104,820 (18,141)
NET PROFIT (LOSS) 10349 42,030 (31,681)
Note: All sales are on cash
Note: Favourable variances are reported as a positive. Unfavourable variances are reported as a negative
The Kimchi Kitchen
BALANCE SHEET
As at 30 June 2020
2020 2019 Variance
$ $ $
ASSETS
Current Assets
Cash at bank (20,011) 78,380 (98,391)
Debtors 1,500 5,500 – (4,000)
Inventory 15,411 15,411 –
Total Current Assets (3,100) 99,291 (102,391)
Non Current Assets
Property, plant & equipment 163,500 123,500 40,000
Less Accumulated Depreciation 26,460 24,700 (1,760)
Total Non Current Assets 137,040 98,800 38,240
TOTAL ASSETS 133,940 198,091 (64,151)
LIABILITIES
Current Liabilities
Creditors 500 5,500 – 5,000
Total Current Liabilities 500 5,500 – 5,000
Non Current Liabilities
Term Loan 4,800 9,300 4,500
Total Non Current Liabilities 4,800 9,300 4,500
TOTAL LIABILITIES 5,300 14,800 9,500
NET ASSETS 128,640 183,291 (54,651)
Represented by
OWNER’S EQUITY
opening balance 183,291 226,261 – (42,970)
Net Profit for Year 10,349 42,030 (31,681)
193,640 268,291 (74,651)
Less Drawings 65,000 85,000 20,000
TOTAL OWNER’S EQUITY 128,640 183,291 (54,651)
Favourable variances are shown as a positive. Unfavourable variances are shown as a negative
The Kimchi Kitchen
CASHFLOW STATEMENT
For the year ended 30 June 2020
2020 2019 2018
$ $ $
CASH- FLOWS FROM OPERATING ACTIVITIES
Receipts
Sales 219,000 237,500 294,134
Debtors collected 4,000
GST collected on sales 21,900 23,750 29,413
Total receipts 244,900 261,250 323,547
less Payments
Accounting fees 2,875 2,500 2,000
Advertising 2,080 3,200 4,000
Bank charges 355 320 270
Cost of Goods Sold 85,690 90,650 88,240
Electricity 4,480 3,200 3,100
Creditors paid 5,000
GST paid on purchases 15,789 11,580 16,069
Net GST paid to the ATO 6,111 12,170 13,344
Insurance 1,785 1,700 1,650
Interest 650 700 700
Rent 18,000 4,500 4,200
Stationery 561 550 500
Telephone 2,415 2,300 2,000
Wages 88,000 84,250 89,366
Total payments 233,791 217,620 225,439
Net cash-flows from operating activities 11,109 43,630 98,108
CASH- FLOWS FROM INVESTING ACTIVITIES
Receipts – – –
less Payments
Asset purchases 40,000 7,200 55,000
Total payments 40,000 7,200 55,000
Net cash-flows from investing activities (40,000) (7,200) (55,000)

CASH- FLOWS FROM FINANCING ACTIVITIES
Receipts
Capital contributed by owner – 8,000 25,000
Total receipts – 8,000 25,000
less Payments
Drawings 65,000 85,000 100,000
Loan payments 4,500 4,500 4,500
Total payments 69,500 89,500 104,500
Net cash-flows from financing activities (69,500) (81,500) (79,500)

NET CASH FLOW (98,391) (45,070) (36,392)

Opening cash position 78,380 123,450 159,842

Closing cash position (20,011) 78,380 123,450

Based on the financial statements you must calculate the following ratios:
Ratio Ratio Formula 30.6.20 30.6.19
Gross profit ratio
Net profit ratio
Return on Owners equity ratio
Current Ratio
Operating Expense Ratio
Liquidity Ratio
PART A
For each of the ratios above:
1. Calculate the ratios for 30.6.19 & 30.6.20
2. Write one short paragraph on the meaning each ratio and the factors which affect the ratios for this business.
3. Detail whether each ratio improved or deteriorated compared to the prior year (one sentence)
4. Describe two things that the business could be doing which is causing the change in
each ratio from the prior year to the current year (one to two paragraphs). Read the financial statements to determine which specific areas caused the change.
5. Recommend two changes to business practices which the business could implement to improve or further improve each ratio and financial position of the business. Ensure these recommendations refer to the issues identified in point 3 above (one to two paragraphs).
PART B
The business is using manual cash books and you are concerned about the lengthy delay in preparing the financial statements. You are also worried that the reports are missing transactions and stock records may be incorrect.
What improvements would you recommend regarding the record keeping and internal controls of the business (think about the accounting system and systems and controls that could be put in place to address these concerns. Think about your responses in Part A). Write one to two paragraphs.
PART C
In one to two paragraphs, identify two main problem areas for the business and provide two recommendations to ensure the overall financial viability of the business. You may draw on your analysis and responses above to determine your two main recommendations. Write one to two paragraphsAssessment Coversheet
Student Name CIT Number
Competency Title, Code and Banner Code
CRN Manage Finances (ACCT342 – BSBFIM601A)
Managing Finances (HOTL168C – BSBFIM601A)
43348 / 43870 / 43265
Assessment Type ? Written ? Case Study ? Project ? Presentation ? Other
Assessment Name Assessment Task 2 – Financial statement analysis
Assessment Date • Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8
• Assessment task 2b (FINAL) is to be uploaded into eLearn by
Thursday 23.4.20 (Week 10)
Student Statement: This assessment is my own work. Any ideas and comments made by other people have been acknowledged. I understand that by emailing or submitting this assessment electronically, I agree to this statement.
Student Signature Date
PRIVACY DISCLAIMER: CIT is collecting your personal information for assessment purposes. The information will only be used in accordance with the CIT Privacy Policy.
Assessor Feedback
Feedback will be provided in eLearn
? Student provided with feedback
Attempt 1 ? Satisfactory
? Not Yet Satisfactory
Date / /
Attempt 2 ? Satisfactory
? Not Yet Satisfactory
Date / /
Assessor Name Philip McGuire Assessor Signature
Note to Assessor: Please record any reasonable adjustment that has occurred for this assessment.
Instructions to Assessor
Work, Health and Safety: A work health and safety check of the assessment environment is to be conducted prior to the assessment and any hazards addressed appropriately.
List the time, materials provided and assessment range and conditions on the next page
These sections should be detailed enough for multiple assessors to consistently implement the assessment and include details of location, time restrictions, level of assistance permitted (if any), WHS, environment protocols, etc. The student should have access to techniques, procedures, information, resources and aids which would normally be available in the workplace. Include if open or closed book.
Materials to be supplied may include: assessment paper, site plan, text, internet access, etc.
Information for Students: You may have two (2) attempts for this assessment.
• If your first attempt is not successful, your teacher will discuss your results with you and will arrange a second attempt.
• If your second attempt is not successful, you will be required to re-enrol in this unit.
Only one re-assessment attempt will be granted for each assessment item.
Time Allowed: Assessment task 2a (DRAFT) is to be reviewed by your teacher in class in Week 8. Assessment task 2b (FINAL) is to be uploaded into eLearn by
(Week 10).
Materials Provided: Assessment paper, materials on eLearn
Assessment Range and Conditions: This is a take home assignment
Assessment Criteria: To achieve a Satisfactory result, your assessor will be looking for your ability to demonstrate the key skills/tasks/knowledge detailed in the Assessment Task to industry standard. Your submission should be of a professional standard, using full sentences and paragraphs. In addition, the assessment criteria for each part of this assessment is detailed below.
PART A
• Identify the meaning of each ratio and describe the factors which impact each ratio
• Improvement or deterioration in each ratio correctly identified
• Two reasons for the change in each ratio are correctly identified
• Two changes to business practices which would improve or further improve the ratio correctly identified
PART B
• Appropriate recommendations provided regarding the record keeping and internal controls of the business
PART C
• Two significant business issues are correctly identified
• Appropriate recommendations provided to address the identified business issues and ensure the financial viability of the business
See next page for specific instructions for this assessment
Assessment Task Instructions for Students
The following financial information is provided:
The Kimchi Kitchen
INCOME STATEMENT
For the year ended 30 June 2020
2020 2019 Variance
$ $ $
SALES REVENUE 219,000 237,500 (18,500)
Less Cost of Goods Sold 85,690 90,650 4,960
GROSS PROFIT 133,310 146,850 (13,540)
Less OTHER OPERATING EXPENSES
Accounting fees 2,875 2,500 (375)
Advertising 2,080 3,200 1,120
Bank charges 355 320 (35)
Depreciation 1,760 1,600 (160)
Electricity 4,480 3,200 (1,280)
Insurance 1,785 1,700 (85)
Interest 650 700 50
Rent 18000 4,500 (13,500)
Stationery 561 550 (11)
Telephone 2,415 2,300 (115)
Wages 88,000 84,250 (3,750)
Total Operating expenses 122,961 104,820 (18,141)
NET PROFIT (LOSS) 10349 42,030 (31,681)
Note: All sales are on cash
Note: Favourable variances are reported as a positive. Unfavourable variances are reported as a negative
The Kimchi Kitchen
BALANCE SHEET
As at 30 June 2020
2020 2019 Variance
$ $ $
ASSETS
Current Assets
Cash at bank (20,011) 78,380 (98,391)
Debtors 1,500 5,500 – (4,000)
Inventory 15,411 15,411 –
Total Current Assets (3,100) 99,291 (102,391)
Non Current Assets
Property, plant & equipment 163,500 123,500 40,000
Less Accumulated Depreciation 26,460 24,700 (1,760)
Total Non Current Assets 137,040 98,800 38,240
TOTAL ASSETS 133,940 198,091 (64,151)
LIABILITIES
Current Liabilities
Creditors 500 5,500 – 5,000
Total Current Liabilities 500 5,500 – 5,000
Non Current Liabilities
Term Loan 4,800 9,300 4,500
Total Non Current Liabilities 4,800 9,300 4,500
TOTAL LIABILITIES 5,300 14,800 9,500
NET ASSETS 128,640 183,291 (54,651)
Represented by
OWNER’S EQUITY
opening balance 183,291 226,261 – (42,970)
Net Profit for Year 10,349 42,030 (31,681)
193,640 268,291 (74,651)
Less Drawings 65,000 85,000 20,000
TOTAL OWNER’S EQUITY 128,640 183,291 (54,651)
Favourable variances are shown as a positive. Unfavourable variances are shown as a negative
The Kimchi Kitchen
CASHFLOW STATEMENT
For the year ended 30 June 2020
2020 2019 2018
$ $ $
CASH- FLOWS FROM OPERATING ACTIVITIES
Receipts
Sales 219,000 237,500 294,134
Debtors collected 4,000
GST collected on sales 21,900 23,750 29,413
Total receipts 244,900 261,250 323,547
less Payments
Accounting fees 2,875 2,500 2,000
Advertising 2,080 3,200 4,000
Bank charges 355 320 270
Cost of Goods Sold 85,690 90,650 88,240
Electricity 4,480 3,200 3,100
Creditors paid 5,000
GST paid on purchases 15,789 11,580 16,069
Net GST paid to the ATO 6,111 12,170 13,344
Insurance 1,785 1,700 1,650
Interest 650 700 700
Rent 18,000 4,500 4,200
Stationery 561 550 500
Telephone 2,415 2,300 2,000
Wages 88,000 84,250 89,366
Total payments 233,791 217,620 225,439
Net cash-flows from operating activities 11,109 43,630 98,108
CASH- FLOWS FROM INVESTING ACTIVITIES
Receipts – – –
less Payments
Asset purchases 40,000 7,200 55,000
Total payments 40,000 7,200 55,000
Net cash-flows from investing activities (40,000) (7,200) (55,000)

CASH- FLOWS FROM FINANCING ACTIVITIES
Receipts
Capital contributed by owner – 8,000 25,000
Total receipts – 8,000 25,000
less Payments
Drawings 65,000 85,000 100,000
Loan payments 4,500 4,500 4,500
Total payments 69,500 89,500 104,500
Net cash-flows from financing activities (69,500) (81,500) (79,500)

NET CASH FLOW (98,391) (45,070) (36,392)

Opening cash position 78,380 123,450 159,842

Closing cash position (20,011) 78,380 123,450

Based on the financial statements you must calculate the following ratios:
Ratio Ratio Formula 30.6.20 30.6.19
Gross profit ratio
Net profit ratio
Return on Owners equity ratio
Current Ratio
Operating Expense Ratio
Liquidity Ratio
PART A
For each of the ratios above:
1. Calculate the ratios for 30.6.19 & 30.6.20
2. Write one short paragraph on the meaning each ratio and the factors which affect the ratios for this business.
3. Detail whether each ratio improved or deteriorated compared to the prior year (one sentence)
4. Describe two things that the business could be doing which is causing the change in
each ratio from the prior year to the current year (one to two paragraphs). Read the financial statements to determine which specific areas caused the change.
5. Recommend two changes to business practices which the business could implement to improve or further improve each ratio and financial position of the business. Ensure these recommendations refer to the issues identified in point 3 above (one to two paragraphs).
PART B
The business is using manual cash books and you are concerned about the lengthy delay in preparing the financial statements. You are also worried that the reports are missing transactions and stock records may be incorrect.
What improvements would you recommend regarding the record keeping and internal controls of the business (think about the accounting system and systems and controls that could be put in place to address these concerns. Think about your responses in Part A). Write one to two paragraphs.
PART C
In one to two paragraphs, identify two main problem areas for the business and provide two recommendations to ensure the overall financial viability of the business. You may draw on your analysis and responses above to determine your two main recommendations. Write one to two paragraphs

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