QUESTIONS:
1.What type of information should a computerized system be able to record and generate?
2.There are several legal and organization requirement relating tocoding of data. what legislation is involed in all poloies and procedures that outline the coding ,classifying and checking of data?
3.How do manufacturing overheads include?
4.What do most businesses analyze their performance and what does it involed.
5. What are leverage ratios?
6.budget preparation?
7.the difference between the budgeted revenues & income and actual revenues & income?
8.What is Variance analysis?
Answers:
Question 1
A computerized system able to record following information
- Actual and budgeted financial information
- Financial and nonfinancial plans
- Financial bills
- The report related to creditors and debtors
- Financial projections
- Audit reports and management reports
- Spreadsheet calculative reports
- Other information
Question 2
Legislations applied
- GST
- Pay As You Go
- Industrial relations
- Fringe Benefits Tax
- Workers Compensation Insurance
- Capital Gains Tax
- External requirements
- Audit
- Legal behavior
- Occupational Health and Safety
- Superannuation
- Other
Question 3
Manufacturing overhead includes all factory expenses except direct material expenses and direct labor expenses. These expenses can be indirect labor, indirect material, factory rent, factory insurance, depreciation o factory’s assets or other expenses.
Question 4
Business analyzes their performance by making calculations of net profit earned. This process involves the financial record keeping. After the record keeping of financial information, the analyst needs to make the calculation of the cost of goods sold, then operating, financing and taxation related costs. Calculation o surplus of revenues over all these costs is known as profit.
Question 5
The leverage ratio is a ratio which determines the portion o assets financed from debts. It measures the ability of organization in dealing with its outstanding debts. The leverage ratio is calculated by dividing debts o the organization by the total assets o the organization.
Question 6
In budget preparation following questions should be incorporated
- Liquidity of business
- The expected growth of business
- Projections for the business projects
- Expected control expenditure
- Target performance
- Expected financial structure and projections for required changes
- Revenue and cost forecasting for operating activities
Question 7
Variances show c. This variance helps the management understand why the budgeted results could not achieve the actual results. It helps the understanding controllable and noncontrollable variances. In addition to this for controllable variances management could take corrective actions so that in next period such variances could be minimized and organization could achieve budgeted results in actual form.
Question 8
Variance analysis used for making corrective actions for a controllable variance, determining bonus and penalties or different department managers and another responsible person for the variances.