SITXFIN003 – Manage finances within a budget
Knowledge Test
| Instructions
· This is an open book assessment to be conducted in the classroom under Trainer’s supervision. · There are 21 knowledge test questions, each with four responses of which there is only one correct response. · You are to nominate the correct response to each question by circling the appropriate letter ( a, b, c, or d) on this document · You must answer all questions correctly to achieve competency for this assessment. · On completion, submit the knowledge test to your assessor. · Ask your assessor, if you do not understand a question. Your assessor cannot tell you the answer he/she may be able to re-word the question for you. · Re-assessment: If you do not achieve the required standard, you will be given the opportunity to be re-assessed by our Assessor. Arrangements will be made on an individual basis. If you are deemed to be NS (Not Satisfactory), your assessor will either ask specific questions orally and record them with you using the supplementary evidence sheet or you will be asked to resubmit your responses in full. · Feedback: Your assessor will provide feedback to students after the completion of the assessment. The assessor will explain the appeals process when required. |
- Funds are allocated in a business according to its priorities and obligations. What is an area these funds need to be allocated to?
(a) Personal expenses.
(b) Owner’s drawings.
(c) Capital injection.
(d) Utility expenses.
- Why might management change their priorities during a financial period?
(a) They expect an increase in staff turnover in the industry.
(b) They do not need a particular reason as long as they can justify it.
(c) To reflect changes in marketing strategies designed to create new business.
(d) To avoid paying tax at the end of the financial year.
- What must you do before implementing any changes to income and expenditure priorities?
(a) Check that the business can afford to implement the changes.
(b) Document the changes in the budget.
(c) Discuss the changes with appropriate colleagues.
(d) Submit a formal proposal to the owner of the business.
- It’s important to consult with and inform staff about resource decisions. Who would you share this financial information with?
(a) All staff as they need to know what is expected of them.
(b) Staff in other outlets so they can support your goals.
(c) Only the director of a company as they are the only one who authorises the business’s financial decisions.
(d) Authorised staff.
- What is an effective method of promoting awareness of budget targets and controls amongst the staff of an outlet?
(a) Discussing budget controls and targets at team meetings.
(b) Texting regular updates to the staff.
(c) Writing notes occasionally in the communication diary.
(d) Asking team members to discuss budget goals during meal breaks.
- What documents are used to record and track resource allocation?
(a) Profit and loss statements, purchasing documentation and rosters.
(b) Profit and loss statements, balance sheets, purchasing documentation and payroll documentation.
(c) Payroll documentation, timesheets, leave requests and balance sheets.
(d) Balance sheets, purchasing documentation, payroll documentation and company procedures.
- Why should you check actual income and expenses against a budget?
(a) To check if the POS systems are recording accurate information.
(b) So you can compile a report to the bank on our financial status.
(c) To find out if you are achieving budget targets or not.
(d) To provide performance information to prospective customers.
- What types of financial commitments should you include in budgets to ensure accurate monitoring?
(a) Debts, utilities, food and beverage purchases.
(b) Financial business goals and mission statements.
(c) Weekly staff rosters and food and beverage purchase orders.
(d) Income gained from investments and distributed to shareholders.
- What is a valid method of investigating causes of budget deviations?
(a) Check performance against previous budget forecast.
(b) Dig deeper into the figures to see who is responsible for the deviation.
(c) Determine if there were any unforeseen circumstances which affected the results.
(d) Documenting the results and comparing them to results obtained in the following three-month period.
- Should you report all budget deviations?
(a) No. You should report deviations according to the significance of the deviation.
(b) No. You should attempt to improve budget results before reporting deviations.
(c) Yes. You should report all deviations that exceed $500.
(d) Yes. Every deviation needs further investigation to determine the cause and ensure it doesn’t occur again.
- Analysing customer spending can help identify causes of current deviations. How can it also help manage and control future budget deviations?
(a) Information gained from the analysis can be used by the staff to increase sales.
(b) A visual chart can be prepared from the results, so staff can better understand budget targets.
(c) Customer trends can be identified, allowing marketing to change future promotional campaigns.
(d) Corrective action can be taken to reduce or eliminate the causes of the deviations.
- There are several ways you can advise colleagues of the current status of a budget. What is an appropriate method of sharing this information within the management team?
(a) Written status report.
(b) Text message.
(c) Note left in communication diary.
(d) Email listing budget deviations for each area.
- When monitoring your weekly budget you notice a difference between the actual and budgeted figures for your wages expenses. What should you do to fix this variance?
(a) Change your budgeted figures so the variance no longer exists.
(b) Take action immediately to investigate the deviation and identify how improvements can be made.
(c) Ignore the variance until the figures are compared at the end of the year.
(d) Research the figures the original forecasts were based on to determine if they are correct.
- Stock control is an important method of controlling expenses. What is one method which could be used to improve a stock control system and budget performance?
(a) Change where the stock is stored to make access for staff easier and faster, reducing time and increasing performance.
(b) Review turnover of all stock items to determine which items sell quickly or slowly, and then modify ordering systems to suit turnover rates.
(c) Expand the delivery area so larger trucks can deliver larger quantities of stock, reducing costs.
(d) Only order items in bulk to reduce the amount of packaging and therefore the amount of waste produced.
- Who needs to know about desired budget outcomes?
(a) Colleagues who are affected by the outcomes or whose work affects the achievement of outcomes.
(b) Customer and colleagues.
(c) Suppliers, the financial team, department managers and operational staff.
(d) All full-time employees.
- Which research option would help you investigate new approaches to budget management?
(a) Negotiate new contracts with corporate clients, airlines or travel agents who use your establishment.
(b) Determine whether to make specific products in-house or buy ready-made from a supplier.
(c) Develop new budgets to suit the current budget results.
(d) Provide staff training on budget management and resource allocation.
- What should you do after researching new approaches to budget management?
(a) Update the budgets with the changes that will benefit the business.
(b) File the research in a locked cabinet.
(c) Inform management of the potential cost to the business if they implement the changes.
(d) Define and communicate the benefits and disadvantages of new approaches to relevant colleagues.
- Why is it important to consider the impact any changes will have on customer service?
(a) Customers can get upset when changes are made without telling them, leading to increased complaints.
(b) Managers and staff will have to deal with any complaints that arise from the changes.
(c) A deterioration in customer service will eventually lead to poor return business and loss of income.
(d) Public image is very important, so changes should be minimised to ensure this is not tarnished.
- What must you ensure when presenting recommendations for budget management?
(a) Be well prepared, communicate clearly, and ensure your recommendations are logical and practical.
(b) Be well prepared and prove to management why your ideas are the best.
(c) Communicate assertively and clearly to ensure you gain approval for the implementation of your ideas.
(d) Ensure everyone has a copy of your report and that you have highlighted areas of significance prior to distribution.
- A number of financial and statistical reports are regularly prepared and distributed within hospitality businesses. Which option provides information of the financial status and viability of the business?
(a) Profit and loss report and balance sheet.
(b) A purchasing and sales budget.
(c) A breakdown of sales and customer spending analysis.
(d) Flash reports and long-term budgets.
- Reports can include information designed to enable informed decision-making by management. What financial information would support decision-making?
(a) A summary of the team’s goals or objectives.
(b) Your predictions for the future direction of the business.
(c) Rosters and leave applications.
(d) Statistical trends.