Fnsbkg405 establish and maintain a payroll system - what is

Question

Establish and Maintain a Payroll System

Assessment Task 01 -

Question 1:

Go to the Fair Work Ombudsman Website. By using the Search bar at the top of the page you will find links to valuable information for use in the workplace:

- Outcomes of the FWC's 2016-17 Annual Wage Review.
- Pay Calculator - an online tool to enable checking of pay rate calculations under modern awards.
- Links to Modern awards.
- Wages and conditions for trainee and apprentices.
- Fair Work Information Statement.
- Templates to assist in keeping employment records.

(a) What is the national minimum wage effective from 1 July 2017?

(b) What record-keeping templates are available to assist with payroll?

(c) Under the Employing Staff templates, outline the details of a letter of engagement for casual staff.

(d) What are the aims of the National Employment Standard?

(e) What is the employer's obligation in relation to the Fair Work Information Statement?

Question 2:

(a) An employee thinks they have been underpaid. What procedures might you follow to check out the employee's claim? (At least 6 items should be listed).

(b) What information should be included on an employee's pay advice?

(c) When processing the payroll you notice an irregularity/unusual payment. How would you check the payroll information is correct?

Question 3:

Calculate the PAYG Withheld and the Net Pay for the following employees. Assuming all of them are Australian Residents for Tax Purposes.

	TFN	Gross Weekly Pay	Allowance	Tax Offset p.a or Extra Tax	Tax-Free Threshold	PAYG Withheld	Net Pay
John	Yes	$850	Meal Allowance $10/meal for 2 meals (Not Taxed)	Nil	Yes
Mark	Yes	$500	Car  Allowance 200kms @ 66c/km (Not Taxed)	$850 Offsets	Yes
Betty	Yes	$906	Shift Allowance $20 per Week (Taxed)	$20 Extra Tax Per Week	Yes
Susan	No	$990	Nil	Nil	No
Harry	Yes	$1,280	First Aid Allowance $15 per Week (Taxed)	$690 Offsets	Yes

Question 4:

(a) What are the ATO's requirements for salary packaging? Discuss in 120 - 150 words.

(b) What are the three advantages of using payroll services provided by a BAS agent?

Question 5:

Calculate the payment due to an employee, Robyn Brown, based on the following:

Robyn has a base wage of $19.25 per hour. She worked 38 hours at normal time, three hours at time +1/2, and one hour double time and received a meal allowance of $15.60 (pre tax).

The tax (withholding) on her earning is $145.00.

Employee				Date	19/05/2018
		Hours	Rate	Total
Wages
Normal time
Time + ½
Double time
Other
Total Wages
Pre tax allowances
Car allowance
Travel allowance
Other
Total pre tax allowances
Pre tax deductions
Other
Total pre tax deductions
Pre tax earnings
Tax
After tax allowances
Total after tax allowances
After tax deductions
Total after tax deductions
Net pay

Question 6:

Read the following statements and circle the correct answer.

1. A fringe benefit is a benefit provided in respect of employment.	True	False
2. A loan with no interest or low interest given to an employee is determined to be a fringe benefit.	True	False
3. Payments of salary is a fringe benefit.	True	False
4. Living-away-from-home allowances paid to an employee may be a fringe benefit.	True	False
5. If an employee buys goods from the company and is told they need not bother about paying the invoiced amount, this qualifies as a fringe benefit.	True	False
6. All employers covered by the national workplace relations system have an obligation to give each new employee who commenced after 1 January 2010 a Fair Work Information Statement.	True	False
7. Under the National Employment Standards (NES), an employee who has the responsibility for the care of a child may not request a change in their working arrangements to assist them to care for the child.	True	False
8. Persons under 18 years of age are not required to have their individual flexibility arrangements (IFA) agreement signed by their parent or guardian.	True	False
9. Union official must provide 24 hours notice of their intention to enter business premises on union matters.	True	False
10. Modern awards contain information on terms and conditions of employment, wages and allowances.	True	False

Question 7:

Using the information provided, complete the simulated BAS. Assume a quarterly reporting requirement for the period ended 30 September, 2018.
General Ledger

6011 - Salaries and Wages

Date	Docket	Details	Debit	Credit	Balance
1 Jul		Opening Balance			0.00
31 Jul		Wages paid	12,000.00		12,000.00
31 Aug		Wages paid	12,000.00		24,000.00
30Sep		Wages paid	12,000.00		36,000.00

2031 - PAYG Withholdings

Date	Docket	Details	Debit	Credit	Balance
1 Jul		Opening Balance			0.00
31 Jul		PAYG Withheld		1,850.00	1,850.00
31 Aug		PAYG Withheld		1,850.00	3,700.00
30Sep		PAYG Withheld		1,850.00	5,550.00

2032 - PAYG Withholdings no ABN

Date	Docket	Details	Debit	Credit	Balance
1 Jul		Opening Balance			0.00
31 Jul		Withholding		0.00	0.00
31 Aug		Withholding		275.00	275.00
30Sep		Withholding		0.00	275.00

2033 - PAYG other Withholding

Date	Docket	Details	Debit	Credit	Balance
1 Jul		Opening Balance			0.00
31 Jul		Withholding		74.00	74.00
31 Aug		Withholding		0.00	74.00
30Sep		Withholding		0.00	74.00

BAS

PAYG Tax Withheld
Total salary, wages and other	W1      $							.00
payments
Amount Withheld from payments	W2      $							.00
shown at W1
Amount withheld where no ABN is	W4     $							.00
quoted
Other amounts with held (excluding	W3      $							.00
any amount shown at W2 or W4)
Total amounts withheld (W2 + W4 +	W5     $							.00
W5)
Write the W5 amount at 4 in the Summary section below

Summary Amounts you owe the Tax Office
GST on sales or GST instalment	1A	$							.00
PAYG tax withheld	4	$							.00
PAYG income tax instalment	5A	$							.00
Deferred company/fund instalment	7	$							.00
1A + 4 + 5A + 7	8A	$							.00

Perform Financial Calculations

Assessment Task 2 - Project

The owners of the business for which you work want to invest some money. They are unsure whether they should put the money in an investment account with 8% compounding interest for a fixed term of six years and have asked you to calculate the amount that they would get at the end of the investment.

They are investing their own money and the returns will be subject to income tax even though the money will not be withdrawn until the end of the investment period. The amount to be invested is $500,000 and the owners are in the top tax bracket.

Requires: Using these tax table below:
i) Calculate the amount that the investment will return at the end of the period.
ii) The Total Tax and Medicare levy that will be paid to the nearest dollar that will arise from the investment.
iii) Calculate the total

amount of money that they will receive from the investment after tax and the Medicare levy has been paid.

Resident Income Tax Rates from 1 July 2017 (not including Medicare Levy of 2%)

Resident tax rates 2017-18
Taxable income	Tax on this income
0 - $18,200	Nil
$18,201 - $37,000	19c for each $1 over $18,200
$37,001 - $87,000	$3,572 plus 32.5c for each $1 over $37,000
$87,001 - $180,000	$19,822 plus 37c for each $1 over $87,000
$180,001 and over	$54,232 plus 45c for each $1 over $180,000

Short Questions:

1. How do you calculate GST for goods and services? Describe how to calculate the GST on a product costing $15.00 before GST is calculated and how to work out the GST exempt cost of an item costing $19.25 GST inclusive.

2. If you were to invest $150.00 at 5% simple interest for 5 years, how much would it be worth?
Describe how to perform the calculation. Complete the calculation as part of the description.

3. Describe two types of computational errors that can occur in financial calculations and discuss strategies to avoid and detect errors.

Prepare Operational Budgets

Assessment Task 3 - Project

Students should undertake the following projects as directed by the Trainer.

Project 1:

a) Consider this scenario. You have examined the budget reports and have discovered that in the first quarter reporting, that one section has spent over 75% of their budget allocation. What will you do and should you be concerned about this?

b) Why do you think it is important to compare actual income and expenditure figures against budget figures at regular intervals?

c) Using the example in the text of the three products: A, B and C, Prepare a table (Include both Variance and Total amount) with the following information:

Product A:

Budgeted Gross Profit $2,250.00 Actual Gross Profit $ 2,925.00

Product B:
Budgeted Gross Profit $3,100.00 Actual Gross Profit $ 3,875.00

Product C:
Budgeted Gross Profit $6,000.00 Actual Gross Profit $ 4,000.00

d) Choose the overall total from above three Products and write a brief description to explain the variance.

Project 2:

a) Bart's Home Brewing Supplies estimates sales for the next three months ending June 30 to amount to $80,000. Cost of goods sold is normally 60% of sales.

Other information:

Fixed costs per month amount to $2,800

Variable expenses (accept financial) are 10% of sales

50% of Bart's customers pay cash and receive a discount of 5%.

In addition, 20% of Bart's credit customers receive a prompt payment discount of 2% Approximately, 1% of the credit sales are written off as bad
Bart pays all his suppliers within the discount period and receives a discount of 4%. Inventory levels: March 31 (actual) $18,000
June 30 (budgeted) $25,000

Required: Using Microsoft Excel prepare a Budgeted Statement of Financial Performance for the quarter ending 30 June.

b) Sun bite Corporation had September sales of $100,000. Sales for the next three months are forecasted as follows:

October	$125,000
November	$150,000
December	$140,000

Forty percent of all sales are for cash; the remaining 60% are on accounts. 20% of credit sales are collected in the month of sale and the remaining 80% are collected in the following month. Uncollectible accounts have never been material in amount.

Required: Using Microsoft Excel prepare a Schedule of Cash Collection Budget including GST for October to December quarter.

Project 3:

Peter Cahill Ltd is in the process of preparing its expense budget for the coming year. It has decided to use the current year's actual results as a base. These actual results, for the quarter-January to March, taken from the revenue statements were:

Particulars	January	February	March
Operating Expenses
Marketing
Salaries and wages	10,000	12,000	12,400
Freight outwards	400	500	500
Advertising	2 000	2 200	2 200
Total Marketing	12 400	14 700	15 100
Administrative
Salaries	15 000	15 000	16 000
Depreciation	1 000	1 200	1 200
Rates	800	800	800
General expenses	2 000	2 400	2 800
Total administrative	18 800	19 400	20 800
Financial
Interest	100	100	100
Discount allowed	500	400	600
Total financial	600	500	700
Total operating	31 800	34 600	36 600

Peter Cahill Ltd has decided the following percentage increase will apply to the quarter ended 31 March to obtain the budget for next year:

Marketing, salaries and wages	5%
Freight outwards	10%
Advertising	20%
Administrative salaries	10%
Depreciation	5%
Rates	20%
General expenses	10%
Interest	nil
Discount allowed	2%

Required: Using Microsoft Excel prepare an Operating Expenses Budget for Peter Cahill Ltd.