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...

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 Ki
a 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 Um
ellas
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 Um
ellas
    January 2020
    1,800
    1,600
    400
    200
    Fe
uary 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
    Fe
uary 2021
    1,600
    1,400
    400
    200
    
    One-piece swimsuits
    Board short
    Towel
    Beach Um
ella
    Selling Price
    $100
    $80
    $50
    $45
    Product
    One-piece swimsuit
    Board short
    Towel
    Beach Um
ella
    Direct Materials & Direct Labour per unit
    Fa
ic
    $20.75
    $31.25
    $26.25
    $20
    Elastic/Trim
    $13.50
    $3.00
    $5.25
    $1.5
    Direct Labour (sewing time/machine hours)
    1 hou
    0.75 hours
    0.4 hours
    2.0 hours
    Other Cost information:
    Production Related Costs
    Operating Costs
    Direct Labou
    $28/hou
    
    Indirect Labou
    $1/ machine hou
    
    Indirect Materials
    $2 machine hou
    
    Utilities
    $450/month
    $50/month
    Insurance
    $2,200/yea
    $6,000/yea
    Factory Supervisor’s Salary
    $60,000/yea
    
    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 month’s sales units in stock as finished goods and 75% of the direct materials required for the next month’s 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 incu
ed. 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
    
    Cu
ent Assets
    
     Cash
     32,250
     Accounts Receivable
     123,650
     Finished Goods Inventory
    79,150
     Materials Inventory
     114,275
    Total Cu
ent Assets
    $349,325
    
    
    Non-cu
ent Assets
    
     Equipment
     85,000
     Less: Accumulated Depreciation
    ( 8,000)
    Total Non-Cu
ent Assets
     $77,000
    
    
    Total Assets
     $426,325
    
    
    Liabilities & Shareholder Equity
    
    Cu
ent Liabilities
    
     Accounts Payable
     92,500
    Total Cu
ent 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:
1. Using the Excel template provided, prepare the following budgets for the twelve-month period from January 2020 to December XXXXXXXXXXThe 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.
a. Monthly Sales Revenue and Cash Collection Budget
. Production Budget in Units
c. Direct Materials and Cash Purchases Budget
d. Direct Labour Budget
e. Manufacturing Overhead Budget (
eak into variable and fixed components)
f. Monthly Operating Cost Budget
g. Ending Inventory budget for Finished Goods
h. Cost of Sales Budget
i. Budgeted Income Statement for the year ended 31 December 2020
j. Monthly Cash Budget
Your budget spreadsheet must be submitted in Excel Format (not as an appendix in your WORD document).
2. 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 cu
ent market conditions and future predictions that you believe should be considered when following year’s 2020 budget is prepared. You should use
oader industry data and trends from sources such as IBISWorld and the Australian Bureau of Statistics to support your recommendations.
· IBIS World Link via Li
ary: http:
clients1.ibisworld.com.au.ezproxy.scu.edu.au/?u=jyDfnJQRunnPTW9pFcJwYg==&p=
cVYE3hjFrJs3WB/M14xA==
· Harvard Referencing Guide:
http:
libguides.scu.edu.au/management
eferencing
· 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
    Poo
    Unsatisfactory
    Satisfactory
    Good
    Excellent
    Spreadsheet layout and presentation (2.5 Marks)
    Spreadsheet Layout including Raw Assumptions & Data, appropriate tabs co
ectly 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)
oken 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 inco
ect. 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 e
ors arising from careless mistakes and lack of attention to detail. A very good understanding of the application of course content has been demonstrated.
XXXXXXXXXXMarks
    All budgets have been accurately prepared. An excellent understanding of course content has been demonstrated and executed.
XXXXXXXXXXMarks
    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 e
ors 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 e
ors 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 e
ors. 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.
XXXXXXXXXX75Marks
    Excellent presentation with no spelling or grammatical e
ors.
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