Finance: Accounting Standards, Budgeting, Internal Controls, Risk Management

Running head: FINANCE
Finance
Name of the Student
Name of the University
Authors Note

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Assessment Task 1:
Answer to question 1:
Answer to A:
Conservatism can be defined as the political philosophy which places emphasis on the
maintenance of stable society on the basis of hierarchy of power lodged in the traditional
class of leaders as well as traditional values and institutions that is highly respected. The main
purpose of conservatism includes the tradition, human imperfection, organic society and
hierarchy.
Answer to B:
The two key accounting that are directly relevant to gathering revenue data for statutory
recording and reporting are given below;
a. AASB 15
b. AASB 101
Answer to C:
According to the AASB the complete set of financial statements comprises of the following
a. Income statement
b. Statement of financial position
c. Statement of cash flow
d. Statement of retained earnings
Answer to D:
The features of off-the-shelf business management and accounting software products
are as follows;

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a. They help in generating reports that are helpful in tracking all the accounting details
and also administering the multiple currencies.
b. The software is more geared towards the small business owners.
c. The off-shelf business management and accounting software products is more
directed in the direction of accounting savvy audience.
Answer to E:
To manage the business products, it is best to use the MYOB Accounting. This is
because it provides the basic functions related to inventory, sales and receivables, payables,
tracking the cost and quantity for the all the inventoried stock.
Answer to question 2:
Calculation of revenue, gross profit and net profit margins
Product Front pocket wallet
Compact smart phone
wallet
Revenues 3560 3663
Cost of Sales 1080 1073
Gross Profit 2480 2590
Gross Profit margin 70% 71%
Fixed Cost 640 629
Net Profit 1840 1961
Net Profit Margin 52% 54%
Answer b:
Formula for computing contribution margin
Contribution Margin = P – V
Where,
P = Price per product
V = Variable cost per product

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Answer C:
The variable cost is considered while computing contribution margin it forms the
measure of the profit margin which implements emphasis on the proportion of the sales
revenue that is left following the deduction of the variable costs related with the product.
Answer D:
The ways horizontal analysis looks at the changes in each line of item in financial
statement is given below;
a. It places the figures side-by-side where the reader can obtain a comparative
understanding of the percentage change.
b. The column signifying real mathematical variation over two periods and the other one
denotes the percentage change over the two periods.
c. The first column helps in providing the differences among the previous period and the
current period while the percentage column demonstrates what percentage of the
previous number is the number signifying the variation.
Answer to question 3:
Answer A:
Quarter Due date
1. July, August and September 28 October
2. October, November and December 28 February
3. January, February and March 28 April
4. April, May and June 28 July