ACC00714 MANAGERIAL ACCOUNTING MAJOR ASSIGNMENT (Session 2 2019) This assignment is worth 30 marks and 30% of your overall marks. See MySCU for more details about the time and submission requirements Surf N Sea manufactures swimwear and beach accessories for men and women. They operate out of rented premises in Kirra where the factory is split into a manufacturing and storage area and a retail space. The business produces 4 products: One-piece swimsuits for women Board shorts for men Beach Towels Beach Umbrellas You, as the management
View complete question ACC00714 MANAGERIAL ACCOUNTING MAJOR ASSIGNMENT (Session 2 2019) This assignment is worth 30 marks and 30% of your overall marks. See MySCU for more details about the time and submission requirements Surf N Sea manufactures swimwear and beach accessories for men and women. They operate out of rented premises in Kirra where the factory is split into a manufacturing and storage area and a retail space. The business produces 4 products: One-piece swimsuits for women Board shorts for men Beach Towels Beach Umbrellas You, as the management accountant for the firm, have been asked to prepare a range of budgets for the 2020 year. The following information has been gathered: Expected sales volume (number of units) to be sold during 2020: Sales One-piece swimsuits Board short Towel Beach Umbrellas January 2020 1,800 1,600 400 200 February 2020 1,400 1,100 300 180 March 2020 1,300 1,160 260 160 April 2020 1,000 1,000 140 120 May 2020 400 600 80 60 June 2020 400 500 40 40 July 2020 400 500 40 40 August 2020 600 400 80 40 September 2020 1,300 1,160 260 160 October 2020 1,200 1,100 300 180 November 2020 1,200 1,100 300 180 December 2020 1,500 1,200 400 200 January 2021 1,600 1,400 440 220 February 2021 1,600 1,400 400 200 One-piece swimsuits Board short Towel Beach Umbrella Selling Price $100 $80 $50 $45 Product One-piece swimsuit Board short Towel Beach Umbrella Direct Materials & Direct Labour per unit Fabric $20.75 $31.25 $26.25 $20 Elastic/Trim $13.50 $3.00 $5.25 $1.5 Direct Labour (sewing time/machine hours) 1 hour 0.75 hours 0.4 hours 2.0 hours Other Cost information: Production Related Costs Operating Costs Direct Labour $28/hour Indirect Labour $1/ machine hour Indirect Materials $2 machine hour Utilities $450/month $50/month Insurance $2,200/year $6,000/year Factory Supervisors Salary $60,000/year Administration Staff Wages $2,500/month General Office Expenses $1,500/month Rent $4,600/month $1,400/month Repairs and Maintenance See below Inventory: At the end of each month the business plans to have 50% of the following months sales units in stock as finished goods and 75% of the direct materials required for the next months production. Cash Collections: 20% of sales are through the retail outlet at the factory. These customers pay for their purchases at the time of sale. The remainder of sales are to businesses that resell Surf N Sea products. Credit is extended to all business customers. It is estimated 60% of these sales are collected in the month of sale and the remaining 40% are collected in the following month. Cash Payments: All purchases, other than the purchase of direct materials, are paid at the time the expense is incurred. It is estimated 30% of accounts payable will be paid in the month the direct materials are purchased and the remaining 70% will be paid in the following month. The interest rate payable on the loan is 9% per annum. Interest is paid monthly. The loan is on an interest only basis and the principle can be repaid at any time. Depreciation of plant and equipment totals $10,000 for the year. Depreciation is recorded monthly. Repairs and maintenance related to manufacturing plant and equipment is estimated to be $1,500 each quarter payable in March, June, September, and December. Variable manufacturing overhead is allocated based on machine hours. Fixed manufacturing overhead is allocated based on units of production. Ignore GST and Income Tax. Round amounts other than unit costs to nearest dollar value. The opening Balance Sheet is provided below: Surf N Sea Balance Sheet As at 31 December 2019 Assets Current Assets Cash 32,250 Accounts Receivable 123,650 Finished Goods Inventory 79,150 Materials Inventory 114,275 Total Current Assets $349,325 Non-current Assets Equipment 85,000 Less: Accumulated Depreciation ( 8,000) Total Non-Current Assets $77,000 Total Assets $426,325 Liabilities & Shareholder Equity Current Liabilities Accounts Payable 92,500 Total Current Liabilities $92,500 Long-Term Liabilities Bank Loan 154,900 Total Long-Term Liabilities $154,900 Total Liabilities $247,400 Shareholders Equity Share Capital 150,000 Retained Earnings 28,925 Total Shareholder Equity $178,925 Total Liabilities & Shareholders Equity $426,325 Required: Using the Excel template provided, prepare the following budgets for the twelve-month period from January 2020 to December 2020. The first worksheet should contain your raw data and assumptions and all future worksheets should be linked to this data. Use a different worksheet for each budget. Show all calculations and use Excel functions where possible. While you should use examples in your text as a guide, the key to using spreadsheets is that they are structured so that others can use them and follow the flow of information without difficulty. Monthly Sales Revenue and Cash Collection Budget Production Budget in Units Direct Materials and Cash Purchases Budget Direct Labour Budget Manufacturing Overhead Budget (break into variable and fixed components) Monthly Operating Cost Budget Ending Inventory budget for Finished Goods Cost of Sales Budget Budgeted Income Statement for the year ended 31 December 2020 Monthly Cash Budget Your budget spreadsheet must be submitted in Excel Format (not as an appendix in your WORD document). Write a report (Maximum 1,500 words) for your manager to present to the upcoming Board meeting. The report should include: an overview of the expected results for the 2020 year; an analysis of the Contribution Margin for each product and recommendations regarding the products Surf N Sea manufacture and sell; recommendations regarding the cash position of the business; and an analysis of current market conditions and future predictions that you believe should be considered when following years 2020 budget is prepared. You should use broader industry data and trends from sources such as IBISWorld and the Australian Bureau of Statistics to support your recommendations. IBIS World Link via Library: http://clients1.ibisworld.com.au.ezproxy.scu.edu.au/?u=jyDfnJQRunnPTW9pFcJwYg==&p=/bcVYE3hjFrJs3WB/M14xA== Harvard Referencing Guide: http://libguides.scu.edu.au/management/referencing Use visual aids such as tables and graphs to enhance your report presentation. The report should be submitted as a WORD (not PDF) document. Please use the templates provided to prepare the: (1) Budget schedules (excel); and (2) Board Report (word)
Assessment Criteria Poor Unsatisfactory Satisfactory Good Excellent Spreadsheet layout and presentation (2.5 Marks) Spreadsheet Layout including Raw Assumptions & Data, appropriate tabs correctly named for each section of the budget and use of Excel tools in spreadsheet. Insufficient data. Spreadsheet has not been separated into worksheets. Inappropriate layout. Poor use of Excel tools. 0 Marks Use of Worksheets but layout is difficult to follow. Worksheets have not been named. Limited use of Excel tools. Inconsistencies throughout. 1 Mark Use of appropriately named Worksheets. Reasonable use of Excel tools but application is inconsistent. Reasonable layout. 1.5 Marks Use of appropriately named Worksheets. Consistent use of Excel tools. Layout appropriate but lacks consistency in some areas. 2 Marks Use of appropriately named Worksheets. Very good use of a range of Excel tools. All worksheets are linked resulting in a consistent flow of data between worksheets. 2.5 Marks Preparation of Budgets (12.5 Marks) For each Budget: Appropriate layout (monthly) broken into product categories; Clear Headings; Accurate calculations for monthly totals and annual totals. Budgets are mostly inaccurate and incomplete. An understanding of the application of the course content in a business context has not been demonstrated. 0-2.5 Marks Some Budgets are accurate but there are inconsistencies in the data or basic calculations are incorrect. Assignment instructions have not been followed and key items have been left out. 3-6 Marks Most budgets are accurate but there are inconsistencies in the data or basic calculations. Key items have been included and a reasonable understanding of the application of course content has been demonstrated. 6.5-9 Marks All budgets have been prepared and are mostly accurate – minor errors arising from careless mistakes and lack of attention to detail. A very good understanding of the application of course content has been demonstrated. 9.5-10.5 Marks All budgets have been accurately prepared. An excellent understanding of course content has been demonstrated and executed. 11-12.5 Marks Report for the Board (15 Marks) The report must be professionally presented and cover all issues raised in the assignment instructions. A business report format must be used along with visual aids such as tables and graphs. Presentation is unprofessional with numerous spelling and grammatical errors and it does not cover the key requirements set out in the assignment instructions. Inadequate analysis. Not presented in the format of a business report. Very limited use of visual aids. 0-3.25 Marks Presentation is reasonable but the key issues have not been adequately addressed. Spelling and grammatical errors make the report unpresentable requiring the report to be rewritten before it could be presented. Opinions expressed lack insight, are unsupported (inadequate referencing) or referenced external sources lack relevance. Not all aspects of a business report format have been utilised. Limited use of visual aids. 3.5-7 Marks Presentation is reasonable and the key issues have been addressed but more insight into the business could be demonstrated. Opinions expressed are unsupported (inadequate referencing) or referenced external sources lack relevance. Some minor spelling and grammatical errors. Most components of a business report format have been incorporated. Reasonable use of visual aids. 7.5-11 Marks Good, well written presentation and all issues have been covered. Demonstrates a solid insight into the business and recommendations are appropriate. Relevant external sources (at least 2) have been used to support recommendations and these have been appropriately referenced. All components of a business report format have been incorporated. Good use of visual aids. 11.25-12.75Marks Excellent presentation with no spelling or grammatical errors. Demonstrates excellent insight into the business operations and external issues that may affect the business. Extensive use of relevant external resources to support recommendations. Appropriate referencing. All components of a business report format have been incorporated. Excellent use of visual aids. 13-15 Marks
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