SITXFIN003 – Assessment

SITXFIN003 Manage finances within a budget

Assessment

Instructions to Students:

Student name:

Sandhya Singh Khatri

Unit description

This unit describes the performance outcomes, skills and knowledge required to take responsibility for budget management where others may have developed the budget. It requires the ability to interpret budgetary requirements, allocate resources, monitor actual income and expenditure, and report on budgetary deviations.

The skills and knowledge for budget development are covered in SITXFIN004 Prepare and monitor budgets.

·

TASK a – Short answer

Instructions:

· You are to answer all questions.

· Read each question carefully.

· Ensure you have provided all required information.

SECTION 1: ALLOCATE BUDGET RESOURCES

Q1: What is a budget and how does it help a business achieve its goals?

A budget is estimation of income and expenses for a certain period. It helps with planning and controlling the financial affairs in an organization. It is a plan where all the cost, earnings are estimated which helps an organization to calculate the actual profit of the business leading it to achieve its goals.

Satisfactory ☐ Unsatisfactory ☐

Q2: What determines how business funds are divided amongst different departments and projects?

Business funds are divided amongst different departments and projects as per the specific needs necessary for the overall operation of the department.

Satisfactory ☐ Unsatisfactory ☐

Q3: What is the difference between a fixed (static) and flexible (variable) budget?

Fixed budget is prepared in the start of the period for an area which do not have a direct relation to the production and sales remaining the figures static no matter what changes comes in income and expenses.

Flexible budget is prepared which allows for adjustment in an any changing condition. Also used as a tool where initial fixed budget is adjusted to reflect the events which had a direct effect on its outcome.

Satisfactory ☐ Unsatisfactory ☐

Q4: What is a cash flow budget and what is it used for?

Cash flow budget is an estimation of all the in and out of cash in an organization in certain period. It is used for analysing all the cash flow, calculation for capital purchase or renovation and if needed applying for bank loans.

Satisfactory ☐ Unsatisfactory ☐

Q5: What is a profit and loss budget and what is it used for?

Profit and loss budget are a financial plan to analyse profit and loss statement of an organization. It is used to calculate the end profit of certain period as it includes all the incomes and expenditures.

Satisfactory ☐ Unsatisfactory ☐

Q6: What do the following terms mean?

Financial viability

It means the business is making enough profit even after paying all the expenses of an organization.

Profitability

It means the ability to earn fair amount of profit after calculating all the invested amount.

Liquidity

It means the assets which cane be turned into cash for purchase of goods, services and capital assets.

Satisfactory ☐ Unsatisfactory ☐

Q7: What is a budget cycle?

A budget cycle is a process from the beginning of budget to an end of final transactions in a certain period which covers all the transactions of a year.

Satisfactory ☐ Unsatisfactory ☐

Q8: What must you do when budget priorities are changed? Explain why.

Satisfactory ☐ Unsatisfactory ☐

Q9: Your budget allows only a limited amount of funding for wages. Who needs to know about these types of resource decisions? Explain why.

Satisfactory ☐ Unsatisfactory ☐

Q10: List two (2) ways you can promote awareness of the importance of budget control.

1.

2.

Satisfactory ☐ Unsatisfactory ☐

Q11: How does promoting the importance of budget control help you achieve team or work area goals?

Satisfactory ☐ Unsatisfactory ☐

Q12: Why is it important to record resource allocation?

Satisfactory ☐ Unsatisfactory ☐

Q13: Budgets are not the only source of information relating to where resources are allocated and controlled within a business. List four (4) other records used to show resource allocation.

1.

2.

1.

2.

Satisfactory ☐ Unsatisfactory ☐

SECTION 2: MONITOR FINANCIAL ACTIVITIES AGAINST BUDGET

Q14: Why do we record and compare actual performance figures with budgeted figures?

Satisfactory ☐ Unsatisfactory ☐

Q15: How often should you check actual income and expenditure figures against budgets?

Satisfactory ☐ Unsatisfactory ☐

Q16: List six (6) types of financial records you can use to check income and expenditure information.

1.

2.

3.

4.

5.

6.

Satisfactory ☐ Unsatisfactory ☐

Q17: What is one benefit of using computerised systems to maintain financial records?

Satisfactory ☐ Unsatisfactory ☐

Q18: What are financial commitments in a business?

Satisfactory ☐ Unsatisfactory ☐

Q19: List two (2) examples of financial commitments for a business in your industry sector.

1.

2.

Satisfactory ☐ Unsatisfactory ☐

Q20: There are four (4) basic types of expenses you need to record in financial documents to ensure accurate monitoring. Describe and give one example for each type.

Fixed costs

Variable costs

Direct costs

Indirect costs

Satisfactory ☐ Unsatisfactory ☐

Q21: What are the formulas used to calculate a budget variance and a budget variance percentage?

Satisfactory ☐ Unsatisfactory ☐

Q22: Check the figures in the sales budget below.

Sales

Actual $

Budget $

Variance $

%

Bistro

35,000

45,000

(10,000)

(22.22)

Public bar meals

9,000

8,000

1,000

12.25

Club bar meals

8,000

9,000

1,000

11.11

Which department’s figures have been calculated correctly?

Satisfactory ☐ Unsatisfactory ☐

Q23: Indicate if the following budget results are a favourable or unfavourable result.

Favourable or Unfavourable

Actual income is above budget

Actual income is below budget

Expenses are above budget

Expenses are below budget

Satisfactory ☐ Unsatisfactory ☐

Q24: What are the four (4) main reasons budget deviations occur?

1.

2.

3.

4.

Satisfactory ☐ Unsatisfactory ☐

Q25: What factors do you need to consider when deciding whether or not a budget deviation should be investigated further?

Satisfactory ☐ Unsatisfactory ☐

Q26: List three (3) options you might consider to help manage budget deviations effectively.

1.

2.

3.

Satisfactory ☐ Unsatisfactory ☐

Q27: List four (4) types of information about budget targets you should discuss with staff members.

1.

2.

3.

4.

Satisfactory ☐ Unsatisfactory ☐

SECTION 3: IDENTIFY AND EVALUATE OPTIONS FOR IMPROVED BUDGET PERFORMANCE

Q28: How does trend analysis help identify areas for improvement in budget performance?

Satisfactory ☐ Unsatisfactory ☐

Q29: What are two (2) questions you should be asking when assessing existing costs and resources?

1.

2.

Satisfactory ☐ Unsatisfactory ☐

Q30: When identifying new approaches to budget management, who should you discuss desired budget outcomes with? Give a generic answer or name the appropriate job role/positions in your workplace or training environment.

Satisfactory ☐ Unsatisfactory ☐

Q31: What approaches or possible options can you investigate further to control and improve the management of expenses in a business?

Satisfactory ☐ Unsatisfactory ☐

Q32: What approaches or possible options can you investigate further to control and improve the management of payroll expenses in a business?

Satisfactory ☐ Unsatisfactory ☐

Q33: List three (3) approaches or possible options you can investigate further to control and improve the management of accounts payable in a business.

1.

2.

3.

Satisfactory ☐ Unsatisfactory ☐

Q34: List three (3) main methods businesses use to increase their profits.

1.

2.

3.

Satisfactory ☐ Unsatisfactory ☐

Q35: You want to make recommendations for improved budget management and set new budget targets. List two people (2) you should present your recommendations to.

1.

2.

Satisfactory ☐ Unsatisfactory ☐

Q36: The impact of any changes must be considered when developing new approaches or changes to budget management. List one potential benefit or disadvantage that may occur when implementing changes in the following areas.

Customer service

Staff morale

Satisfactory ☐ Unsatisfactory ☐

Q37: How should you present your recommendations for improved budget management?

Satisfactory ☐ Unsatisfactory ☐

Q38: List three (3) examples of the type of information you should include when presenting or communicating about recommendations for budget management.

1.

2.

3.

Satisfactory ☐ Unsatisfactory ☐

SECTION 4: COMPLETE FINANCIAL AND STATISTICAL REPORTS

Q39: What information might you need to include when preparing a statistical or financial report for the supervisors in a suburban hotel? List five examples.

Satisfactory ☐ Unsatisfactory ☐

Q40: What information might you need to include when preparing a formal statistical report for the management team of a large events or reception centre? List five examples.

1.

2.

3.

4.

5.

Satisfactory ☐ Unsatisfactory ☐

Q41: How can you present reports to enable informed decision-making?

Satisfactory ☐ Unsatisfactory ☐

Q42: How do you know when to complete reports?

Satisfactory ☐ Unsatisfactory ☐

Q43: Explain how the features of accounting software programs can assist you to manage budgets.

Satisfactory ☐ Unsatisfactory ☐

TASK B – project

Learner assessment guide and evidence

This assessment requires you to manage and report on budgets over a three-month period.

Create a customer profile.

· Use this profile to provide tailored products and services

You are required to do the following:

· Complete Case Studies 1, 2 and 3.

· Each case study has multiple tasks.

· Read the scenarios and answer the questions.

· Round all dollar values to the nearest whole number when calculating financial information; for example, $12.55 becomes $13, $18.22 becomes $18.

· Unless stated otherwise, round all percentages to one decimal point when calculating financial information; for example, 12.55% becomes $12.6%, 18.22% becomes 18.2%.

· All budget calculations can be completed manually or using accounting software or computer-based spreadsheet software, such as Microsoft Excel or Google Sheets.

This unit applies to tourism, travel, hospitality and event businesses. While the case study scenario is based on a hospitality business, the principles for managing a budget demonstrated in this assessment are the same in all types of businesses.

Case study 1

The Jackson hotel has a bistro, two bars (public and sports), a drive-through and walk-in bottle shop and TAB situated beside the sports bar.

You are the manager of JJ’s Bistro. It seats 210 people and is open for lunch and dinner, seven days a week. The hotel promotes a family environment and has a playroom for younger children and an activity centre for pre-teens containing electronic and other games. These glass walled areas are within view of customers seated in the rear section of the bistro.

The hotel’s management team develop an operational budget for the business based on previous budgets, anticipated business and any special projects, such as renovations or new products. Each operational area within the hotel is given a departmental budget based on organisational goals and their anticipated revenue and expenses.

Budgets are developed on a quarterly basis. Each department has quarterly and monthly budget targets. Monthly budgets can be adjusted during a quarterly cycle if circumstances within the department change.

The following events have taken place during the April budget period.

· Prices for meat, fruit and vegetables have increased as a result of recent drought in some regions and floods or storms in others.

· Prices for many wines have fallen due to a surplus in the market.

· Beer prices have risen slightly, again due to the drought leading to shortages of ingredients and an increase in government taxes.

· A major wine supplier has been running an in-house promotional campaign, with staff product knowledge training provided to help increase sales.

· The bistro menu changes to the new winter menu on May 1st. Its introduction is being promoted in April throughout the hotel.

Task 1: Monitor budgets

Review the following budgets for the Jackson Hotel – June quarter. Answer all questions based on the contents and outcomes of the Jackson Hotel operational budget – June quarter.

Jackson Hotel operational budget – June quarter

April

May

June

June quarter

$

$

$

$

Revenue

Food sales

116,800

127,750

120,450

365,000

Beverage sales

240,000

247,500

262,500

750,000

Tab commission

49,300

47,850

47,850

145,000

Total revenue

406,100

423,100

430,800

1,260,000

Cost of sales

Food purchases

48,180

49,640

48,180

146,000

Beverage purchases

84,000

86,625

91,875

262,500

Total cost of sales

132,180

136,265

140,055

408,500

Gross profit

273,920

286,835

290,745

851,500

Expenses

Accounting

2,700

3,000

4,300

10,000

Advertising/promotions

3,900

4,810

4,290

13,000

Bank charges

7,582

7,359

7,359

22,300

Cleaning contractor

7,451

7,451

7,451

22,354

Commission credit card

767

767

767

2,300

Small equipment replacement

833

833

833

2,500

Insurance

1,833

1,833

1,833

5,500

Laundry

347

357

347

1,050

Legal fees

1,280

360

360

2,000

Licence fees & permits

983

983

983

2,950

Motor vehicle expenses

500

500

500

1,500

Maintenance

4,224

4,352

4,224

12,800

Printing & stationery

800

800

800

2,400

Rubbish removal

500

500

500

1,500

Communication

2,000

2,000

2,000

6,000

Training & development

1,190

1,155

1,155

3,500

Wages & on-costs

193,050

198,900

193,050

585,000

Utilities

12,000

11,647

11,647

35,295

Total expenses

241,940

247,607

242,399

731,949

NET PROFIT

31,980

39,228

48,346

119,551

Q1: List the hotel’s financial commitments under their correct cost category. Name at least two (2) commitments for each category

Variable direct costs

·

·

Variable indirect costs

· Small equipment

· Legal fees

Fixed indirect costs

· Rubbish removal

· Cleaning contractor

Satisfactory ☐ Unsatisfactory ☐

Q2: Name the top four (4) cost categories the business has allocated the most funds too in this budget period.

1. Wages and on cost

2. purchase

3. Utilities

4. cost

Satisfactory ☐ Unsatisfactory ☐

Q3: Why have significant funds been allocated to these categories?

Discuss their importance to the business and consequences if inadequate funds are allocated.

Satisfactory ☐ Unsatisfactory ☐

Q4: Review the Bistro departmental budget – April.

Bistro departmental budget – April

Budget

Actual

$

$

Revenue

Food sales

105,120

119,837

Beverage sales

89,250

96,390

Total sales

194,370

216,227

Cost of sales

Food purchases

40,953

45,048

Beverage purchases

27,563

30,043

Total cost of sales

68,516

75,091

Gross profit

125,854

141,136

Expenses

Advertising/Promotions

780

624

Cleaning contractor

1,490

1,490

Small equipment replacement

333

393

Laundry

245

232

Maintenance

1,493

1,262

Printing & stationery

160

195

Training & seminars

408

653

Wages & on-costs

85,901

98,771

Utilities

3,441

3,235

Total expenses

94,251

106,855

NET PROFIT

31,603

34,281

You are holding a team meeting to discuss the financial targets provided in the organisational and April bistro budgets.

What information do you need to communicate to the team to ensure they understand the targets and goals to be achieved?

Satisfactory ☐ Unsatisfactory ☐

Q5: What techniques can you use to promote awareness of methods of controlling costs or increasing sales so you can achieve budget targets?

Satisfactory ☐ Unsatisfactory ☐

Task 2: Calculate variances

Complete the comparative analysis report for the Bistro departmental budget – April on Page 24 by calculating all missing dollar value and percentage variances.

Complete the Favourable/Unfavourable column by indicating if the budget results are favourable (F) or unfavourable (UF) for the business.

SITXFIN003 – Assessment

Page|2

Name: SITXFIN003 – Assessment

Version: 2019.2

Last Reviewed: May 2019

Page|1

Comparative analysis report

Bistro departmental budget – April

NOTE: Don’t forget to round your figures up or down to the nearest whole number.

April

Favourable / Unfavourable

May

June quarter

Budget

Actual

Variance

Variance

Budget

Budget

$

$

$

%

$

$

Revenue

Food sales

105,120

119,837

14,717

14.0%

fav

114,975

328,500

“

89,250

96,390

7,140

8%

fav

91,875

262,500

Total sales

194,370

216,227

21,857

11.24%

fav

206,850

591,000

Cost of sales

Food purchases

40,953

45,048

unfav

42,194

124,100

Beverage purchases

27,563

30,043

2,481

9.0%

unfav

26,775

78,750

Total cost of sales

68,516

75,091

6,576

unfv

68,969

202,850

Gross profit

125,854

141,136

0.0%

fav

137,881

388,150

Expenses

Advertising/Promotions

780

624

(156)

(20.0%)

962

2,600

Cleaning contractor

1,490

1,490

0

15.5%

1,490

4,471

Small equipment replacement

333

393

60

333

1,000

Laundry

245

232

(13)

(5.3%)

245

735

Maintenance

1,493

1,262

0.0%

1,493.33

4,480

Printing & stationery

160

195

35

21.9%

160

480

Training & seminars

408

653

245

60.0%

396

1,200

Wages & on-costs

85,901

98,771

12870

unfav

89,345

260,763

Utilities

3,441

3,235

(206)

(6.0%)

3,494

10,589

Total expenses

94,251

106,855

0.0%

97,918

286,318

NET PROFIT

31,603

34,281

8.5%

fav

39,963

101,832

SITXFIN003 – Assessment

Page|2

Name: SITXFIN003 – Assessment

Version: 2019.2

Last Reviewed: May 2019

Task 3: Question and answer

Answer all questions based on the budget outcomes in the completed April budget comparative report in Task 2 and case study information.

Q1: Are there any significant variances in the sales figures that you should be concerned about? Explain what the results indicate and why you are/are not concerned about them.

……. because food sales and beverage are same

Satisfactory ☐ Unsatisfactory ☐

Q2: Are there significant variances in any of the expenses categories that you think should be investigated further? If yes, discuss which categories and why you think they need investigation. If no, discuss why the deviations do not warrant investigation.

…….. (at least 4 or 5 line)

Satisfactory ☐ Unsatisfactory ☐

Q3: Based on your responses to questions 1 and 2, what is your overall evaluation of the budget results? Is the bistro meeting its financial targets?

Yes, (always think about both income side and expenses side)

Satisfactory ☐ Unsatisfactory ☐

Q4: Which expense category has the most funds allocated to it? Explain why it is important you manage costs in this category carefully.

Wages and on cost … ( talk about rostering)

Satisfactory ☐ Unsatisfactory ☐

Q5: Using the results and information obtained from the April comparative report, your answers to the previous questions and the background information, write a transcript of the outcomes of your report ready to deliver to the bistro staff at the next team meeting. The transcript should include the following information.

· The current status of the budget; is the work area meeting its budget targets, is it on track to meet June quarter budget targets?

· Which areas are underperforming or performing better than expected?

· What changes, if any, need to be made to help the team meet next month’s budget targets?

· An outline of budget targets for May.

Organisational factors that contributed to the setting of these targets.

Satisfactory ☐ Unsatisfactory ☐

Case study 2

JJ’s Bistro is located in Jackson’s hotel. It seats 210 people and is open for lunch and dinner, seven days a week. The hotel promotes a family environment and has a playroom for younger children and an activity centre for pre-teens containing electronic and other games. These glass-walled play areas are within view of customers seated in the rear section of the bistro.

The following events took place during the May budget period.

· Prices for meat, fruit and vegetables have increased as a result of recent drought in some regions and floods or storms in others.

· Prices for many wines have fallen due to a glut in the market.

· Beer prices have risen slightly, again due to the drought leading to shortages of ingredients and an increase in government taxes.

· Most utility companies increased prices by 7% at the start of May.

· The local police started a blitz on drink driving in the middle of May with increased police presence in local suburbs and roadside testing of drivers.

· In-house training was provided to key food and beverage staff in April by a coffee supplier. The aim is to increase sales and the quality of coffee served. The training was free of charge as part of a new preferred supplier contract with the coffee supplier.

· A major wine supplier has been running an in-house promotional campaign, with staff training provided to help increase product knowledge.

· The bistro menu changed to the new winter menu on 1 May 20XX. It was heavily promoted in May throughout the hotel and in local community newspapers.

·

Task 1: Interpret budget results

Review the following budgets for the Jackson Hotel – May.

Evaluate the budget outcomes and their impact on the operation and financial goals of the bistro.

Answer all questions based on the outcomes in the comparative analysis report, Bistro purchasing budget – May and the case study information.

Comparative analysis report

Bistro departmental budget – May

May

Budget

Actual

Variance

Variance

$

$

$

%

Revenue

Food sales

114,975

112,676

(2,299)

(2.0)

Beverage sales

91,875

90,497

(1,378)

(1.5)

Total sales

206,850

203,173

(3,677)

(1.8)

Cost of sales

Food purchases

42,194

45,864

3670

8.7

Beverage purchases

26,775

29,399

2624

9.8

Total cost of sales

68,969

75,265

6294

9.1

Gross profit

137,881

127,910

(9,971)

(7.2)

Expenses

Advertising/Promotions

962

981

19

2

Cleaning contractor

1,490

1,490

0

0

Small equipment replacement

333

288

(45)

(13.5)

Laundry

245

237

(8)

(3.3)

Maintenance

1,493

1,329

(164)

(11)

Printing & stationery

160

114

(46)

(28.8)

Training & seminars

396

713

317

80.1

Wages & on-costs

89,345

103,283

13,938

15.6

Utilities

3,494

3,456

(38)

(1.1)

Total expenses

97,918

111,891

13,973

14.3

NET PROFIT

39,963

16,019

(23,944)

(59.9)

Bistro purchasing budget – May

May

Budget

Actual

Variance

Variance

$

$

$

%

Food purchases

Fruit & vegetables

5,063

5,970

907

17.9

Dairy products

8,439

8,177

(262)

(3.1)

Meat & poultry

14,768

17,662

2,894

19.6

Fish & seafood

4,219

4,506

287

6.8

Dry goods – food

7,595

7,511

(84)

(1.1)

Dry goods – other

2,110

2,038

(72)

(3.4)

Total food purchases

42,194

45,864

3,670

8.7

Beverage purchases

Wine

4,820

5,359

539

11.2

Spirits

4,016

4,185

169

4.2

Beer, ciders – packaged

5,891

6,762

871

14.8

Beer – keg

4,552

5,162

610

13.4

Soft drinks, juices – packaged

3,079

3,230

151

4.9

Post mix

4,418

4,701

283

6.4

Total beverage purchases

26,776

29,399

2,623

9.8

Total cost of sales

68,970

75,263

6,293

9.1

Food cost %

36.7%

40.7%

Beverage cost %

29.1%

32.5%

Cost of sales %

33.3%

37%

SITXFIN003 – Assessment

Page|2

Name: SITXFIN003 – Assessment

Version: 2019.2

Last Reviewed: May 2019

Page|1

Bistro labour budget – June quarter (don’t worry about this topic for now)

Labour expenses

April

May

June

June Quarter

Budget

Actual

Variance

Budget

Actual

Variance

Budget

Actual

Variance

Budget

Actual

Variance

$

$

%

$

$

%

$

$

%

$

$

%

Total salaries

9,780

9,780

0

9,780

9,780

0

9,780

9,780

0

29,340

29,340

0

Total front of house staff

45,053

52,171

15.8

47,382

55,105

16.3

44,804

51,260

14.4

137,239

158,537

15.5

Total kitchen staff

21,864

26,237

20.0

22,610

27,332

20.9

21,770

26,232

20.5

66,244

79,801

20.5

Total wages & salaries

76,697

88,188

15.0

79,772

92,217

15.6

76,354

87,272

14.3

232,823

267,678

15.0

On-costs

9,204

10,583

9,573

11,066

9,162

10,473

27,939

32,121

Total labour expenses

85,901

98,771

15.0

89,345

103,283

15.6

85,516

97,745

14.3

260,762

299,799

15

Percentage of total sales

44.2

45.7

43.2

50.8

45.1

51.5

14.5

16.5

Bistro staffing levels

No. staff

Monday

Tuesday

Wednesday

Thursday

Friday

Saturday

Sunday

Front house

Crnt

Rvsd

Crnt

Rvsd

Crnt

Rvsd

Crnt

Rvsd

Crnt

Rvsd

Crnt

Rvsd

Crnt

Rvsd

Supervisor

2

0

0

1

1

2

2

2

2

2

2

2

2

1

1

Food Attendant FT

3

3

3

2

2

2

2

2

2

2

2

2

2

2

2

Food Attendant Cas

10

2

1

2

1

3

1

4

2

6

4

8

6

7

6

Bar Attendant FT

3

1

1

2

2

2

2

2

2

3

3

3

3

2

2

Bar Attendant Cas

4

2

1

1

0

1

0

1

1

2

1

2

1

2

1

Bus person Cas

2

1

1

2

1

2

1

Total rostered

8

6

8

6

10

7

11

9

16

13

19

15

16

13

Kitchen

Chef

1

1

1

1

1

1

1

1

1

1

Sous chef

1

1

1

1

1

1

1

1

1

1

1

Cooks FT

3

2

2

2

2

2

2

2

2

2

2

3

3

3

3

Apprentices FT

3

1

1

1

1

1

1

1

1

2

2

3

3

3

3

Kitchen hand Cas

4

1

1

1

1

2

1

2

2

3

1

3

1

3

2

Total rostered

5

5

5

5

6

5

7

7

9

7

11

9

10

9

Glossary
Crnt

Current staffing level

FT

Fulltime employee

Rvsd

Revised staffing level

Cas

Casual employee

SITXFIN003 – Assessment

Page|2

Name: SITXFIN003 – Assessment

Version: 2019.2

Last Reviewed: May 2019

Q1: Discuss how the outcomes food and beverage sales and costs of sales indicated in the May comparative analysis report impact the bistro area and the business overall. Consider the types of deviation (positive or negative) and size of the deviations in food, beverage and total sales and cost of sales categories.

Satisfactory ☐ Unsatisfactory ☐

Q2: What are two possible explanations for the deviations in food costs and beverage costs? Consider information provided in the May purchasing budget as well as the comparative report and case study information.

Satisfactory ☐ Unsatisfactory ☐

Q3: When preparing the budgets, the hotel forecasted food costs as 36.7% of food sales and beverage costs as 29.1% of beverage sales.

Is the bistro meeting organisational goals for cost of sales? What is the difference between the budget target and actual results?

Food purchases

4% and no

Beverage purchases

3.4% and not meeting the target

Satisfactory ☐ Unsatisfactory ☐

Q4: Should these deviations be reported to management? Explain why/why not.

Yes , they need to be aware (read section 2 )

Satisfactory ☐ Unsatisfactory ☐

Q5: Based on the May purchasing budget, in what categories are the largest food and beverage cost deviations occurring?

Satisfactory ☐ Unsatisfactory ☐

Task 2: Investigate option to improve performance

The food and beverage manager is very concerned about the food and beverage purchasing and cost of sales results. They want the bistro team to make it a priority to meet budget targets for cost of sales in June. Management then plan to reduce budget allocations for food and beverage purchases in the September quarter budget. It is an organisational goal to reduce cost of sales to below the current percentages of 37% food cost and 30% beverage cost. To meet June and September quarter budget targets, new methods of managing costs must be investigated.

· Answer all questions based on the outcomes in the comparative analysis report Bistro departmental budget – May, Bistro purchasing budget – May and case study information.

Q1: List four (4) options for managing costs that could be applied to this situation.

1.

2.

3.

4.

Satisfactory ☐ Unsatisfactory ☐

Q2: You have decided to source new fruit and vegetable and seafood suppliers. Describe how you would investigate if changing suppliers is a viable option for reducing your cost of sales. How will you obtain information to determine if prices and product quality from alternate suppliers are appropriate for your operation?

Prices, comparison, quality, reputation, relationship etc…

Methos: quotation, bank statement to compare the quality of work…

Satisfactory ☐ Unsatisfactory ☐

Q3: You need to investigate which current suppliers have increased prices for products and services, how much prices have risen and how much of the business’s financial resources are allocated to existing suppliers.

What organisational financial documentation will provide this information?

Page 21, write 3 or 4 of them

Satisfactory ☐ Unsatisfactory ☐

Q4: Your research has revealed that a number of other suppliers can supply similar quality items at cheaper prices than your current supplier. Describe what you would discuss with your current supplier before making a decision.

Same as Q2

Satisfactory ☐ Unsatisfactory ☐

Q5: Who would you consult with before implementing any changes to the hotel’s suppliers of fruits and vegetable and seafood products?

Head chef, management or purchasing staff

Satisfactory ☐ Unsatisfactory ☐

Task 3: Improve budget performance

· Read and interpret the information and outcomes contained in the Bistro labour budget – June quarter.

· Evaluate their impact on the operation and financial goals of the bistro.

· Answer all questions based on the labour comparative analysis report, staffing and case study information.

Q1: Complete the table below by inserting the variance percentage for each category in each month.

Category

Bistro labour budget – variance percentage

April

May

June

June quarter

Salaries

Front of house

Kitchen

Total labour

Satisfactory ☐ Unsatisfactory ☐

Q2: What do these statistics tell you about the bistro’s performance for the June quarter? Explain what the variances mean and how this affects the department’s ability to meet its financial goals.

Front of house and kitchen

Satisfactory ☐ Unsatisfactory ☐

Q3: Management think one reason for high bistro labour costs is the department is consistently overstaffed; more staff than necessary are rostered on for most service periods. Rosters have been reviewed and new staffing levels suggested for front of house and kitchen areas. The number of customers served and sales revenue is expected to remain relatively stable in the near future.

Review the bistro’s current and revised staffing levels in Bistro staffing levels table.

Discuss the impact these changes could have on customer service levels, your team and budget targets. Consider both positive and negative outcomes.

POSITIVE: LABOUR SAVE

NEGATIVE: SLOW SERVICE, LOS OF REGULAR CUSTOMERS, DOWN OF BUSINESS REPUTATION

Satisfactory ☐ Unsatisfactory ☐

Q4: What payroll documentation can you use to maintain detailed records and monitor funds allocated to labour costs during the budget period?

PAGE 70

Satisfactory ☐ Unsatisfactory ☐

Q5: During the initial investigation phase, with whom would you discuss the reasons for changes to rosters and the desired outcomes of the changes?

MANAGEMENT, HEAD CHEF, SERVER

Satisfactory ☐ Unsatisfactory ☐

Q6: You believe the changes will have a negative impact on customer service standards and food quality, leading to an increase in customer complaints. This could lead to lower customer numbers and sales revenue over the next year.

You want to present your concerns to management and recommend smaller cuts to staffing levels, especially to the front of house team during the busiest periods. Your suggestions include better management of hours worked by casual staff and a review of service procedures to streamline work practices.

Prepare a transcript of your recommendations to be presented to management at the next management meeting.

NOTE: TRANSCRIPT REQUIRES LONGER RESPONSES, TELL CAUSE AND CONS OF BUSNIESS,, LOOSING BUSINESS REPUTATION

Satisfactory ☐ Unsatisfactory ☐

Case study 3

It is the end of the June financial quarter and all departments in the Jackson’s hotel are preparing financial and statistical reports.

Task 1: Prepare a profit and loss statement

· Review the Bistro reports.

· Complete the Bistro profit and loss statement – June quarter by calculating all missing dollar value and percentage variances.

Satisfactory ☐ Unsatisfactory ☐

Task 2: Prepare a statistical report

· Complete the Trend analysis report – June quarter using the information provided.

Satisfactory ☐ Unsatisfactory ☐

SITXFIN003 – Assessment

Page|2

Name: SITXFIN003 – Assessment

Version: 2019.2

Last Reviewed: May 2019

Page|1

Bistro profit and loss statement – June quarter

Monthly actual results

June quarter actual results

May

June

July

Budget

Actual

Variance

Variance

$

$

$

$

$

$

%

Revenue

Food sales

119,837

112,676

110,356

328,500

342,869

Beverage sales

96,390

90,497

84,630

262,500

271,517

Total sales

216,227

203,173

194,986

591,000

614,386

Cost of sales

Food purchases

45,048

45,865

42,174

124,100

133,087

Beverage purchases

30,043

29,399

23,827

78,750

83,269

Total cost of sales

75,091

75,264

66,001

202,850

216,356

Gross profit

141,136

127,909

128,985

388,150

398,030

Expenses

Advertising/Promotions

624

981

884

2,600

2,489

(111)

(4.3)

Cleaning contractor

1,490

1,490

1,490

4,471

4,471

0

0

Small equipment replacement

393

288

372

1,000

1,053

53

5.3

Laundry

232

237

283

735

751

16

2.2

Maintenance

1,262

1,329

1,314

4,480

3,905

(575)

(12.8)

Printing & stationery

195

114

145

480

454

(26)

(5.4)

Training & seminars

653

713

519

1,200

1,884

684

57

Wages & on-costs

98,771

103,283

97,745

260,762

299,799

39,037

15

Utilities

3,235

3,456

4,190

10,588

10,881

293

2.8

Total expenses

106,855

111,891

106,942

285,316

325,687

NET PROFIT

34,281

16,018

22,043

101,834

72,343

Trend analysis report – June quarter

Monthly actual results

Comparison to previous June quarters

May

June

July

June quarter – current

June quarter – 200X

June quarter – 20XX

Variance 200X to current

Variance 20XX to 200X

V %

V %

V %

$

$

$

%

%

Revenue

Food sales

14.0

(2)

1.8

328,500

286,781

256,955

12.7

10.4

Beverage sales

8.0

(1.5)

4

262,500

228,638

208,975

12.9

8.6

Total sales

11.2

(1.8)

2.7

591,000

515,419

465,930

9.6

Cost of Sales

Food purchases

10

(8.7)

(6.2)

122,859

106,273

96,602

13.5

9.1

Beverage purchases

9

(9.8)

2.4

78,750

66,229

60,732

15.9

8.3

Total cost of sales

9.6

(9.1)

(2.9)

201,609

172,502

157,334

14.4

8.8

Gross profit

12.1

(7.2)

(2.7)

389,391

342,917

308,596

11.9

Expenses

Advertising/Promotions

(20)

(2)

(3)

2,600

2,275

2,025

12.5

11

Cleaning contractor

0

0

0

4,471

3,845

3,230

14

16

Small equipment replacement

18

13.7

(11.6)

1,000

890

829

11

6.9

Laundry

(5.3)

3.2

(15.4)

735

642

581

12.7

9.5

Maintenance

(15.5)

11

12

4,480

3,754

3,274

16.2

12.8

Printing & stationery

21.9

29

9.2

480

453

425

5.6

6.2

Training & seminars

60

(80)

(31.0)

1,200

1,062

1,017

11.5

4.2

Wages & on-costs

15

(15.6)

(14.3)

260,762

219,822

200,698

15.7

8.7

Utilities

(6)

1.1

14.7

10,589

8,661

7,674

18.2

11.4

Total expenses

13.4

14.4

(13.8)

286,317

241,404

219,753

9.0

NET PROFIT

8.5

(60.1)

(30.4)

103,074

101,513

88,843

1.5%

Variance formula

To calculate variance between two time periods.

(Current year – Previous year) / Current year x 100 = variance%

Example 1

(June quarter current year – June quarter 200X) / June quarter current year x 100 = variance between the two periods

Food sale variance = (328,500 – 286,781) / 328,500 x 100 = 12.7% increase in food sales revenue

Example 2

(June quarter 200X – June quarter 20XX) / June quarter 200X x 100 = variance between the two periods

Cleaning contractor variance = (3,845 – 3,230) / 3,845 x 100 = 16.0% increase in cleaning contractor expenses

SITXFIN003 – Assessment

Page|2

Name: SITXFIN003 – Assessment

Version: 2019.2

Last Reviewed: May 2019

Task 3: Prepare a management report

Prepare a short report to management outlining the following information.

· Positive and negative budget variations indicated in monthly and quarter analysis reports and profit and loss statement that are significant enough to affect the operation of the bistro and its profitability.

· Trends identified in the trend analysis report that have the potential to affect the bistro’s profitability in the immediate future.

· Possible reasons for the positive or negative variations and trends.

· Any recent actions that have been taken or changes to operational procedures as a result of trends and deviations.

Base the report on the following information.

· Profit and loss statement

· Trend analysis report

· April, May and June comparative analysis reports

· Case study information provided in Assessments C and D

· Your responses to questions in Assessments C and D

The report should present information in a clear, concise and easy to understand manner so it supports good decision-making processes.

TALK ABOUT SALES AND EXPENSES, ATLEAST 10 TO 12 LINES

Satisfactory ☐ Unsatisfactory ☐

Task 4: Question and answer

Q1: The following factors must be considered when preparing financial and statistical reports. Select three factors that are relevant to one or more of the reports you prepared or completed in Tasks 1, 2 and 3.

Discuss how they influenced preparation or outcomes of the report(s).

Factors for consideration in the preparation of financial and statistical reports.

· Performance of department, project and/or products and services

· Daily, weekly and monthly transactions

· Variances in income and/or expenditure

· Sales performance

· Sales returns

· Staff costs

· Cash flow

· Covers and financial return

· Expenditure

· Income

· Occupancy rates and financial return

· Stock levels

· Wastage

· Yield

EXPLAIN ANY 3 TOPICS ATLEAST 2 OR 3 LINES

Satisfactory ☐ Unsatisfactory ☐

Practical checklist

To be completed by the assessor.

Learner’s name:

Did the learner successfully demonstrate evidence of their ability to do the following?

Completed

Yes

No

Case study 1

Monitor income and expenditure and evaluate budgetary performance over budgetary life cycle.

☐

☐

Allocate funds according to budget and agreed priorities.

☐

☐

Use financial records to regularly check actual income and expenditure against budgets.

☐

☐

Problem solving skills to identify and report deviations according to significance of deviation.

☐

☐

Communicate with and advise colleagues of budget status in relation to targets.

☐

☐

Assess existing costs and resources and proactively identify areas for improvement.

☐

☐

Numeracy skills to interpret and use budget figures in day-to-day work operations.

☐

☐

Interpret business and financial documents and document clear recommendations based on budget information and reports.

☐

☐

Case study 2

Discuss changes to income and expenditure priorities with appropriate colleagues prior to implementation.

☐

☐

Consult with and informs relevant personnel about resource decisions.

☐

☐

Use financial records to regularly check actual income and expenditure against budgets.

☐

☐

Use problem solving skills to identify and report deviations according to significance of deviation.

☐

☐

Investigate appropriate options for more effective management of deviations.

☐

☐

Assess existing costs and resources and proactively identify areas for improvement.

☐

☐

Discuss desired budget outcomes with relevant colleagues.

☐

☐

Undertake appropriate research to investigate new approaches to budget management.

☐

☐

Use numeracy skills to interpret and use budget figures in day-to-day work operations.

☐

☐

Interpret business and financial documents and document clear recommendations based on budget information and reports.

☐

☐

Case study 3

Complete financial reports within designated timelines and using correct budget terminology.

☐

☐

Prepare and present clear and concise information to enable informed decision making.

☐

☐

Use numeracy skills to interpret and use budget figures in day-to-day work operations.

☐

☐

Interpret business and financial documents and document clear recommendations based on budget information and reports.

☐

☐

Use problem solving skills to identify and report deviations according to significance of deviation.

☐

☐

Assessment result:

Task A – Short answer: Satisfactory ☐ Unsatisfactory ☐

Task B – Project: Satisfactory ☐ Unsatisfactory ☐

Overall Outcome:

Competent

☐

Not Yet Competent

☐

Assessor’s feedback or additional comments to the learner:

Assessor signature:

Date:

Assessment tasks

For a student’s performance to be deemed satisfactory for the whole unit of competence, they must demonstrate satisfactory performance in this assessment.

Written assessment

In this assessment task students are required to read the questions and either select the one correct answer from a number of alternatives or write a response in the space provided.

If part of a task is not satisfactorily completed the assessor will arrange for the student to complete further assessment to demonstrate competence. Students are permitted three (3) attempts to demonstrate competency.

Overall student performance in the unit is to be recorded as either Competent or Not Yet Competent.

This assessment contains a series of questions designed to allow students to demonstrate competence in the unit.

To complete the written assessment, students must successfully complete the following:

Task B – Project

Unit outcome

At the successful completion of this assessment, a Competent result will be awarded. The overall unit result and feedback are recorded at the end of this documentation.

Task A – Short answer

You are required to:

PLAGIARISM AND COLLUSION

CONSEQUENCES OF PLAGIARISM AND COLLUSION

Complete the cover sheet and ensure you accept, sign and date the student declaration on the Student Learning Management System (LMS).

Read through and follow all instructions provided.

Complete each assessment task/activity.

Submit your assessment to the Student Learning Management System (LMS) by the due date.

Ensure your submission identifies your name, unit code and title.

Plagiarism is ‘a practice that involves the using of another person’s intellectual output and presenting it as one’s own’. This includes the presentation of work that has been copied, in whole or part, from other sources (including other students’ work, published books or periodicals, the Internet, unpublished works or unauthorised collaboration with other persons), without due acknowledgement.

A student found to have plagiarised material will be instantly graded Not Yet Competent (NYC) and may be subject to one or all of the following:

Referral of the matter to the Academic Coordinator for: an intervention meeting, issuing of written warning, clarification regarding assessment re-submission requirements and allocation of additional assessment tasks.

Referral of the matter to the Director for: official disciplinary action by Frontier Education and/or suspension from the course.

Page|2

Name: SITXFIN003 – Assessment

Version: 2019.2

Last Reviewed: May 2019

Page|1

RTO No : 110080CRICOS No : 03520G EDUCATION

.MsftOfcThm_MainLight1_Fill { fill:#FFFFFF; } .MsftOfcThm_MainDark1_Stroke { stroke:#000000; }

.MsftOfcThm_MainLight1_Fill { fill:#FFFFFF; } .MsftOfcThm_MainDark1_Stroke { stroke:#000000; }

.MsftOfcThm_MainLight1_Fill { fill:#FFFFFF; } .MsftOfcThm_MainDark1_Stroke { stroke:#000000; }