Manage Physical Assets - Assessment Activity

This assessment activity focuses on managing physical assets, including strategies for maintenance, monitoring condition and performance, and coordinating financing. It covers critical thinking, planning and organizational skills, literacy and numeracy skills, and knowledge of different types of assets, maintenance requirements, financing options, asset registers, taxation arrangements, and legislation related to asset management. The assessment includes a case study and tasks related to asset management.

SITXFIN005 Manage Physical Assets V1.0
Assessment Activity
(Formative)
SITXFIN005
Course: Manage Physical Assets
STUDENT NAME
STUDENT ID. NUMBER
ASSESSOR NAME
RESULT
INDIVIDUAL
ASSESSMENT
RESULT
ASSESSMENT
ACTIVITY C ¨ NYC ¨ FINAL
GRADE
ASSESSOR FEEDBACK
I have received the Assessment Feedback on____________________________ (DATE)
STUDENTS SIGNATURE
ASSESSOR SIGNATURE DATE
DOCUMENT CONTROL
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
VERSION DATE AUTHOR COMMENTS
1.0 29th December 2018 Emily McLennan &
Reece Thomas
 Original
ASSESSMENT INSTRUCTIONS
Assessment Overview Format: Create an Asset Register/Manual
Total Marks Students undertaking this assessment must demonstrate
competency as per the Training Package or accredited
course requirements, guidelines and rules.
Academies Australasia Polytechnic’s VET Programs
observes the following grading scheme for the below
assessment:
Competency based assessment is a process where an
assessor works with you to collect evidence of competence,
using the benchmarks provided by the unit standards that
comprise the national qualifications
Time Allocated Trainer Discretion
ASSET MANAGEMENT
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
ASSESSMENT ACTIVITY: CASE STUDY
BUSINESS DESCRIPTION
1. Develop strategies for the systematic maintenance, repair and purchase of physical
assets.
2. Monitor the condition and performance of physical assets in the workplace.
3. Coordinate financing of physical assets.
This assessment addresses the following required skills and knowledge:
SKILLS
 Critical thinking and analytical skills to evaluate complex information from varied
sources to develop strategic management approaches to physical assets.
 Planning and organisational skills to develop and implement complex and
interrelated workplace procedures, systems and schedules for physical asset
maintenance.
 Literacy skills to interpret and develop a varied range of complex business
documents.
 Numeracy skills to analyse and prepare a wide range of financial data, and to
interpret estimates and financial agreements for physical asset acquisition.
KNOWLEDGE
 Types of physical assets required by organisations in different work contexts.
 Maintenance requirements for different types of physical assets in the relevant
industry context.
 Features and benefits of different financing options for asset acquisition, including
purchase, rent, lease and hire purchase.
 Features of an assets register and techniques for its development and maintenance.
 Overview of taxation arrangements in relation to the acquisition and disposal of
physical assets.
 Specific legislation related to the management and maintenance of physical assets,
such as that relevant to vehicles or food production equipment.
 Environmental standards and requirements in relation to different physical assets.
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
PART A: CASE STUDY
BACKGROUND INFORMATION
Hi. My name is Alexander. I have just started working as the manager of McLennan’s
Café. As with any new role there are many challenges.
Let’s talk through some of the most important ones that I am about to face.
 I don’t really know how accurate our books are.
 I have no listing and am not sure what our assets are.
 There is nothing to tell me what the book value of these assets is.
 How do we know what will need to be replaced?
 How will we accommodate the cost of replacing assets?
Please help me gain a better understanding of asset management by answering the
following questions and completing the following tasks.
1. Why is it important that we know what our assets are? Explain.
It is important to know about the assets of the organization as they are source of
creation of value for the company. They help in generating revenue, increase the value
of the business and facilitate the day to day running of the business. Further, knowing
the assets helps in better utilization of assets and proper allocation of resources to
achieve higher profitability for the company and maximization of wealth for the
stakeholders.
2. How can asset management help us?
a. Achieve our financial objectives?
Asset management can help us achieve our financial objectives in the
following manner:
(i) Maximising profit through proper resource allocation;
(ii) Optimisation of resources;
(iii) Generation of employment;
(iv) Higher Revenue and utilisation of asset
b. Achieve our marketing objectives?
Asset management shall help in achieving our marketing objectives in the
following manner:
(i) Better client relationship;
(ii) Increase Sale of Financial Products;
(iii) Higher Profitability;
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
(iv) Lower Cost;
(v) Entering new market segments.
c. Meet our occupational health and safety requirements?
Asset management shall help in achieving to meet our occupational health
and safety requirement in the following manner:
(i) Clear defined rules and regulation for safety;
(ii) Maintaining necessary equipment for any hazards;
(iii) Proper plans;
(iv) Training;
(v) Proper Policies can help in recovering major costs etc.
d. Prevent waste and minimise pollution?
Asset management shall help in achieving to prevent waste and
minimize pollution in the following manner:
(i) Proper Treatment of waste before discharge into water, air or land;
(ii) Using energy efficient devices in the organization;
(iii) Using Pollution efficient devices can reduce discharge contents.
3. I have now compiled a list of our assets including their purchase dates.
ASSET PURCHASE DATE PURCHASE PRICE
(EXCLUDING GST)
EXPECTED LIFE
SPAN
Car 1 July 2017 $19,700 8 years
Espresso Machine 1 July 2017 $1,070 5 years
Furniture 1 July 2017 $23,000 15 years
Dishwasher 1 July 2017 $1,500 13 years
4. When calculating our depreciation we have used the straight-line depreciation
method. Imagine that it’s 2020.
Fill out an asset register for each of these assets.
Asset Register
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
Type Car
Estimated life 8 years Depreciation
method
Straight-line method
Date Particulars Annual
depreciation
$
Accumulated
depreciation $
Book value $
1 July 2017 Purchase 0 0 $19,700.00
30 June 2018 Depreciation $2462.5 $2462.5 17237.5
30 June 2019 Depreciation $2462.5 $4925 14775
30 June 2020 Depreciation $2462.5 $7387.5 12312.5
30 June 2021 Depreciation $2462.5 $9850 9850
30 June 2022 Depreciation $2462.5 $12312.5 7387.5
30 June 2023 Depreciation $2462.5 $14775 4925
30 June 2024 Depreciation $2462.5 $17237.5 2462.5
Asset Register
Type Espresso Machine
Estimated life 5 Depreciation
method
Straight-line method
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
Date Particulars Annual
depreciation
$
Accumulated
depreciation $
Book value $
1 July 2017 Purchase $0.00 $0.00 $1,070.00
30 June 2018 Depreciation $214 $214 856
30 June 2019 Depreciation $214 $428 642
30 June 2020 Depreciation $214 $642 428
30 June 2021 Depreciation $214 $856 214
30 June 2022 Depreciation $214 $1070 0
30 June 2023 Depreciation
30 June 2024 Depreciation
Asset Register
Type Furniture
Estimated life 15 years Depreciation
method
Straight-line method
Date Particulars Annual
depreciation
Accumulated
depreciation $
Book value $
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
$
1 July 2017 Purchase $0.00 $0.00 $23,000.00
30 June 2018 Depreciation $1533.33 $1533.33 21466.67
30 June 2019 Depreciation $1533.33 $3066.67 19933.34
30 June 2020 Depreciation $1533.33 $4600 18400.01
30 June 2021 Depreciation $1533.33 $6133.33 16866.68
30 June 2022 Depreciation $1533.33 $7666.67 15333.35
30 June 2023 Depreciation $1533.33 $9200 13800.02
30 June 2024 Depreciation $1533.33 $10733.33 12266.69
30 June 2025 Depreciation $1533.33 $12266.67 10733.36
30 June 2026 Depreciation $1533.33 $13800 9200.03
30 June 2027 Depreciation $1533.33 $15333.33 7666.7
30 June 2028 Depreciation $1533.33 $16866.67 6133.37
30 June 2029 Depreciation $1533.33 $18400 4600.04
30 June 2030 Depreciation $1533.33 $19933.33 3066.71
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
Asset Register
Type Dishwasher
Estimated life 13 years Depreciation
method
Straight-line method
Date Particulars Annual
Depreciation
$
Accumulated
Depreciation $
Book value $
1 July 2017 Purchase $0.00 $0.00 $1,500.00
30 June 2018 Depreciation $115.385 $115.385 1384.615
30 June 2019 Depreciation $115.385 $230.77 1269.23
30 June 2020 Depreciation $115.385 $346.15 1153.845
30 June 2021 Depreciation $115.385 $461.54 1038.46
30 June 2022 Depreciation $115.385 $576.92 923.075
30 June 2023 Depreciation $115.385 $692.31 807.69
30 June 2024 Depreciation $115.385 $807.69 692.305
30 June 2025 Depreciation $115.385 $923.07 576.92
30 June 2026 Depreciation $115.385 $1038.46 461.535
30 June 2027 Depreciation $115.385 $1153.85 346.15
30 June 2028 Depreciation $115.385 $1269.23 230.765
30 June 2029 Depreciation $115.385 $1384.62 115.38
30 June 2030 Depreciation $115.385 $1500 0
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
NOTE: If the final book value figure differs by a few cents from the annual depreciation
figure, it should be rounded to zero.
5. What is the total value of our assets as of 1 July 2018?
$40944.79
6. Based on the book value of these assets as of 1July 2019, which assets may need to
be replaced within the next two years? What methods can I use to work out which
assets actually need to be replaced?
ANSWERS & WORKINGS
None of the asset. However, Espresso Machine needs to be replaced in three years
Asset Register
Type Espresso Machine
Estimated life 5 Depreciation
method
Straight-line
method
Date Particulars Annual
depreciation
$
Accumulated
depreciation $
Book value $
1 July 2017 Purchase $0.00 $0.00 $1,070.00
30 June 2018 Depreciation $214 $214 856
30 June 2019 Depreciation $214 $428 642
30 June 2020 Depreciation $214 $642 428
30 June 2021 Depreciation $214 $856 214
30 June 2022 Depreciation $214 $1070 0
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
30 June 2023 Depreciation
30 June 2024 Depreciation
Further, the method that can be used to track which asset needs to be replaced in the
organization encompass the following :
(i) Declining Balance Method;
(ii) Double Declining Balance Method;
(iii) Straight Line Method;
(iv) Sum of digits Method;
(v) Annual Production Method.
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
PART B: DEPRECIATE THE FOLLOWING ASSETS ACCORDING TO REQUIRED DEPRECIATION METHOD
MCLENNAN DEPRECIATION SCHEDULE - 2016/2017
Asset
# Description Acquisition
Date
Start
Date End Date
# days
owne
d
Useful
Life Depn Method Original
Cost %
Opening
Written
Down
Value
Depreciation
Amount
Closing
Written
Down
Value
OFFICE
EQUIPMENT
P312 Canon Photocopier 30/06/2016 1/07/2016 30/06/2017 365 5 Diminishing Value 8,000 200% 8000 3200 4800
C001 Elite Computer 1/06/2016 1/07/2016 30/06/2017 365 5 Diminishing Value 3,000 200% 3000 1160 1740
Total 11,000 11000 4400 6540
MOTOR VEHICLES
M010 Toyota Ute 30/06/2016 1/07/2016 30/06/2017 365 8 Straight Line 35,000 100% 35000 4375 30625
M011 Toyota Kluger 1/06/2016 1/07/2016 30/06/2017 365 8 Straight Line 40,000 100% 39583 5000 34583
75,000
LOW-VALUE POOL
C002 Brother Laser Printer 1/06/2016 1/07/2016 30/06/2011 365 Diminishing Value 900 37.5% 871.88 326.95 544.92
900
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
MCLENNAN DEPRECIATION SCHEDULE – JUNE 2017/2018
Asset
# Description Acquisition
Date
Start
Date End Date # days
owned
Usefu
l Life
Depn
Method
Original
Cost %
Opening
Written
Down
Value
Depreciati
on
Amount
Closing
Written
Down
Value
OFFICE
EQUIPMENT
P312 Canon Photocopier 30/06/2016 1/07/2017 30/06/2018 365 5
Diminishin
g Value
8,0
00 200% 4800 1920 2880
C001 Elite Computer 1/06/2016 1/07/2017 30/06/2018 365 5
Diminishin
g Value
3,0
00 200% 1740 696 1044
Total
11,0
00
MOTOR VEHICLES
M010 Toyota Ute 30/06/2016 1/07/2017 30/06/2018 365 8
Straight
Line
35,0
00 100% 30625 4375 26250
M011 Toyota Kluger 1/06/2016 1/07/2017 30/06/2018 365 8
Straight
Line
40,0
00 100% 34583 5000 29583
75,0
00
LOW-VALUE POOL
C002 Brother Laser Printer 1/06/2016 1/07/2017 30/06/2018 365
Diminishin
g Value
9
00 37.5% 544.92 204.35 340.57
9
00
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018

SITXFIN005 Manage Physical Assets V1.0
MCLENNAN DEPRECIATION SCHEDULE – JUNE 2018/2019
Asset
# Description Acquisitio
n Date
Start
Date End Date
#
days
owne
d
Useful
Life
Depn
Method
Original
Cost %
Opening
Written
Down
Value
Depreciati
on Amount
Closing
Written
Down
Value
OFFICE
EQUIPMENT
P312 Canon Photocopier 30/06/2016 1/07/2018 30/06/2019 365 5
Diminishing
Value $ 8,000 200% 2880 1152 1728
C001 Elite Computer 1/06/2016 1/07/2018 30/06/2019 365 5
Diminishing
Value $ 3,000 200% 1044 417.6 626.4
Total $ 11,000
MOTOR VEHICLES
M010 Toyota Ute 30/06/2016 1/07/2018 30/06/2019 365 8 Straight Line $ 35,000 100% 26250 4375 21875
M011 Toyota Kluger 1/06/2016 1/07/2018 30/06/2019 365 8 Straight Line $ 40,000 100% 29583 5000 24583
$ 75,000
LOW-VALUE POOL
C002 Brother Laser Printer 1/06/2016 1/07/2018 30/06/2019 365
Diminishing
Value $ 900 37.5% 340.57 127.72 212.86
$ 900
END OF PAPER
Trainer Resource: SITXFIN005 Version 1.0 © Reece Thomas & Emily McLennan, 2018