Reference no: EM132303103
Learning outcomes
Upon successful completion of this subject, students should:
• be able to define the role of accountants and explain how accounting can assist in making decisions;
• be able to analyse and interpret a range of accounting and financial transactions and reports;
• be able to implement various management accounting tools and techniques in making business decisions;
• be able to identify and describe sources of business finance;
• be able to use a computer spreadsheet to assist in the preparation of business information and be able to generate and analyse a range of business results and reports; and
• be able to employ research and report writing skills.
Assessment 1
Task
Question 1 Role of accountants
Mark Maron is the Chairman of the Board for Maron Music LTD, a medium-sized and rapidly growing business that specialises in musical instruments and publishing music under its own label . Until now Maron Music LTD has has been outsourcing all of the accounting to various firms. You are the current CEO of Maron Music LTD, and you believe that the company would benefit from having its own dedicated accounting function. With plans to establish a second office in another capital city, Maron Music LTD is looking to establish a dedicated accounting team comprising of three key roles:
• Financial Accountant
• Management Accountant
• Auditor
Required
Write a brief report (600 words +/- 10%) to Mark Maron with references (in APA 6th style) which should include good quality sources of information outside the textbook to support your discussion. Your report must include:
• an executive summary (not included in word limit);
• a table of contents (not included in word limit);
• an overview of each of the three roles;
• an outline of the information each role provides;
• identification of any similarities and differences that exists between the three roles;
• outline the advantages and disadvantages of each role; and
• a conclusion, with references to your findings, justifying the dedicated accounting function.
Question 2 Ethics
James Mitchell works for Secure Accountants LTD, an accounting firm that specialises in providing consulting services in relation to investment assets and financial instruments. After the completion of the probationary period, James was assigned to a full-time and permanent senior consulting position in the firm. This position comes with a lucrative salary and a range of fringe benefits.
Since commencing his role James has found his day to day activities and duties have changed considerably, and are not consistent with the description of the role he was initially assigned. James has provided financial product advice about securities and superannuation interests, even when it was unclear whether Secure Accountants LTD had the appropriate licencing arrangements. Given his senior position in the firm, he has often found himself giving advice to clients that were beyond the area of his specialisation.
Although James has adequate support from his peers and immediate supervisors, he finds that there is not only a lack of clarity in what he does, but also a lack of clarity in the business model and activities of Secure Accountants LTD. He has also found that the legal team has not provided the resources and guidance necessary to ensure that all the consulting services are provided efficiently and fairly.
Despite these difficulties James enjoys the opportunity to independently develop new professional skills and knowledge. James is looking to invest in a brand new home with his family, and the permanent position with Secure Accountants LTD has enabled him to enjoy a quality of life that he never had in his life before.
Required
Use the St James Ethics model (p.73 in your text) to address the ethical dilemma. You must use the steps in the model as headings
Question 3 Business Structures
You work for Citizen Kane Partners, an accounting firm specialising in establishing businesses.
Four clients have recently asked you for advice about the most appropriate business structure for their situation.
A. Bill and Ted are old friends and own separate phone repair businesses. They have decided to combine their businesses. They expect that within the coming year they will need additional funds to expand their operations but don't want to be burdened with the debt if it fails.
B. John is a General Practitioner (GP) in a country town. He has has a large patient list and is looking to join with two other GPs to cut down on shared overheads such as rent and administrative assistants. All GPs have comprehensive professional indemnity insurance.
C. Jane is a university student and has been making hats for fun. Jane has sold a number of hats at markets and has been approached by a number of local boutique stores who would like to stock her hats. Jane wants to expand her hobby but is worried about it affecting her studies as she doesn't want the hassle of running a complicated business.
D. Terry and Miranda are intending on purchasing farm land and raising some sheep. They are going to split all profits evenly as they are married and are not interested in having to have each of them sign off on every matter to do with the farm.
For each client select and justify the most appropriate business structure from the following list:
• sole trader
• partnership
• company (include the type of company in your response)
• trust.
You should make reference to the main features of your selection and explain why it is the preferred option over the alternatives (400 words +/- 10%).
Online submission via Turnitin is required for this assignment. Details will be provided by your subject lecturer.
Rationale
This assessment task will assess the following learning outcome/s:
• be able to define the role of accountants and explain how accounting can assist in making decisions.
• be able to employ research and report writing skills.
This assessment task covers topics 1 to 2 and has been designed to ensure that you are engaging with the subject content on a regular basis.
Assessment 2
Task
Financial statements, analysing business transactions and financial statement analysis
Jessica Smith started a new sole trader business called Tech Solutions on 1 January 2019. The business provides telecommunication services to start-up businesses who want to enhance their network and customer reach. Jessica has asked her accountant, Megan Brown, to complete financial statements and write a business report on the financial health of Tech Solutions in its first year of operation.
Next Step has the following account balances as at 31 May 2019;
|
Cash
|
$94,600
|
|
Accounts receivable
|
$22,500
|
|
Fixtures and Fittings
|
$30,000
|
|
Communication Server
|
$55,000
|
|
Accounts payable
|
$17,800
|
|
Bank Loan
|
$25,000
|
|
Capital
|
$106,000
|
|
Income
|
$79,200
|
| Expenses |
($25,900) |
The following transactions occurred in the last month of the financial year- June 2019.
|
June
|
Transaction Description
|
|
1
|
Paid the business telephone bill $1,300.
|
|
2
|
Made a loan repayment of $5,000.
|
|
3
|
Received $6,600 payment for outstanding invoice (sent 15 May) from Ace
Communications.
|
|
6
|
Paid $120 internet service provider account, outstanding from May.
|
|
9
|
Sent a $5,240 invoice for services performed during the first week of June for
Jones Partners.
|
|
12
|
Megan paid $1,500 for a 5 star restaurant meal with friends from the business
account.
|
|
13
|
Received $9,400 in cash from customers for services.
|
|
17
|
A water leak damaged some fittings which had to be immediately disposed with no salvage value. The original cost of the damaged fittings was $3,000.
|
|
18
|
Paid plumber $1,000 to to perform urgent repairs on building plumbing.
|
|
19
|
Megan injected $8,300 of her own cash into the business bank account.
|
|
20
|
With the exception of one $555 invoice (which remains outstanding) received
payment from all remaining outstanding May invoices.
|
|
22
|
Received payment for the last outstanding May invoice.
|
|
25
|
Sent a $3,333 invoice for services performed on 23 June for Quick Marketing.
|
|
26
|
Advanced telecommunication infrastructure was purchased to improve the quality of PR services. The complete cost of the project was $23,500. $8,500 was
paid from the business bank account and the balance was financed via a loan.
|
|
28
|
Sent a $7,530 invoice for services performed in the third week of June for Green
Messenger.
|
|
29
|
Received half payment for invoice sent to Green Messenger.
|
|
30
|
Paid $7,000 in accounting fees for June.
|
|
30
|
Paid $14,000 in rent for the period 1 June 2019 to 31 December 2019.
|
|
30
|
Paid interest expense of $200 for June.
|
Required:
Part A: Worksheet
You are required to complete the worksheet in the ‘Assignment 2 Template' for Tech Solutions. Using the sheet labelled ‘Worksheet' identify the business transactions for June 2019 and construct an accounting worksheet.
Note:
1. Illustrative example 4.4 on pg. 132 of the text can be used as a guide for the format required for the worksheet. You should not limit yourself to this Illustrative example only. You should also review the tutorial questions we have provided the solutions to, as well as any other subject material available.
2. Balances as at 31 May 2019 should be used as your starting point in your accounting worksheet.
3. In your worksheet, you must demonstrate the use of the following Excel functions:
• 'sum'
• bordering
• cell merging
• wrap text
• date.
4. Ensure that you ‘sum' each side of your worksheet to prove the accounting equation.
Part B: Financial statements
Using the same Excel file that you used for Part A, you need to prepare the following financial statements of Tech Solutions from the accounting worksheet for the 2019 financial year:
• Income statement.
• Statement of changes in equity.
• Balance sheet.
Note:
1. Illustrative example 4.5 on pp.132-133 of the text can be used as a guide to the format required for the income statement and balance sheet. Illustrative example 6.8 on the bottom of p. 242 of the text can be used as a guide to the format required for the statement of changes in equity. You should not limit yourself to these illustrative examples only. You should also review the tutorial questions we have provided the solutions to, as well as any other subject material available.
2. Each financial statement should be prepared using the named worksheets provided in the Excel template. You are required to use formulas only to transfer the figures from the worksheet into the statements (do not type figures directly into the statements, with the exception of note 4. below).
3. In your financial statements, you must demonstrate the use of the following Excel functions:
• formulas for each subtotal and total
• bordering
• cell merging
• wrap text.
4. Assume expenses incurred up to 31 May 2019 consisted of: $200 for supplies, $12,000 for accounting fees, $700 for internet services, $10,000 for rent and $3,000 for advertising.
PART C: Ratio analysis
In the same Excel template that you used for Part A and B use the sheet labelled ‘Ratio
Analysis', to complete the following:
• the table labelled 'Ratio Figures'. You are required to use formulas only to transfer the figures needed from the statements into this table (do not type answers directly into this table).
• the column labelled ‘formula'. You are required to provide the written formula for each of the ratio's provided (first one completed for you as an example).
• the column labelled ‘2019'. You are required to use formula only by pulling figures from the table completed above 'Ratio Figures' to show the ratio calculation. (Do not type ratio answer directly into the table).
Note:
In completing the ‘Ratio Analysis' Sheet in the Excel template, you must demonstrate that you have used the following Excel functions:
• '=/+/-'
• bordering
• merging cells
• wrap text.
PART D: Business report
Write a report to Jessican Smith, on behalf of Megan Brown, on the financial health of Tech Solutions for the 2019 financial year. Your report should contain the following details:
• Executive summary
• Evaluation and comparison of ratios calculated in Part C for the following areas (a minimum of two ratios for each category below).
o Profitability
o Asset efficiency
o Liquidity
o Capital structure
• Limitations of the analysis
• Conclusion, including recommendations on areas of improvement.
Note:
Your report should be between 650 +/- 10% words, excluding the cover page, contents page and references.
Online submission via Turnitin is required for this assignment. Details will be provided by your subject lecturer.
Rationale
This assessment task will assess the following learning outcome/s:
• be able to analyse and interpret a range of accounting and financial transactions and reports.
• be able to use a computer spreadsheet to assist in the preparation of business information and be able to generate and analyse a range of business results and reports.
• be able to employ research and report writing skills.
Attachment:- Accounting.rar