Part A
Using the data in the Appendices regarding Cherokee Hospitality Equipment & Supplies business, complete the following:
1. You are to prepare 2 budgets for the business operational plan. The term "operational plan" can be interpreted as any plan that may be required to support day-to-day workplace operations. Examples may include plans related to:
a) Staff re-organisation
b) Impacts of marketing initiatives or campaigns
c) An office relocation or refurbishment
d) Upgrading of facilities
e) Changes in work practices or procedures
f) Business expansion or contraction
g) Introduction of new systems.
h) Or any other relevant operational direction
2. In preparing the budget information your must:
a) Include a developed scope and objectives of your initiative
b) Identify and analyse both internal and external factors that may impact on you plan
c) Demonstrate how you may have consulted with colleagues, management or stakeholders through the development of your plan
d) Include appropriate and financially sound resource strategies
e) Identify and clearly communicate all priorities, responsibilities and timelines
f) Include clear action plans and evaluation systems
g) Include an internal and external communication strategy to keep all stakeholders informed
3. In preparing your budget you must:
a) Identify and interpret data and data sources required for your budget preparation
b) Demonstrate how you have reviewed and analysed data for applicability in readiness for your preparation
c) Analyse both internal and external environments to identify potential impacts on your budget
d) Draft your budget, based on analysis of all available information
e) Estimate income and expenditure and support with valid, reliable and relevant information - including income and expenditure for previous time periods as applicable
f) Assess and present alternative approaches as appropriate
g) Present recommendations clearly and concisely
h) Reflect your business objectives
i) Present your proposal to your assessor in a professional format
Part B
1. To complete your final budget, you are to write a short proposal to you manager (in this case your assessor), requesting approval for your budgets and the reasons why. Your report should be 500-1000 words.
The purpose of this report is to:
a) Present your budgets and persuade stakeholders of approval of your budgets
b) Outline any changes with income and expenditure priorities with your manager
c) Obtain feedback, agree and adjust the budget where appropriate, and include changes as negotiated with your manager to meet appropriate timeframes
Part C
1. Draft an email informing all colleagues of the final budget decisions. Ensure you include the following information in your communication:
a) Outline any ramifications of your budget modifications
b) Detail how you would allocate your funds as outlined in your budget
c) Detail how you intend to keep your colleagues and stakeholders informed of your budget in future (ensuring you promote awareness of the importance of budget control)
d) Detail how you would maintain all records of resource allocation.
When completing these assessments ensures you replace the XX in the year with the correct year ie: 20XX changes to 2014.
Submit your responses to Part A, B & C for this assessment as per instructions in the front of this document.
Appendix A - Cherokee Hospitality Equipment & Supplies
Marek owns a medium sized hospitality equipment & supplies business. He provides you with the following information which is current as of 1 December 20XX. All sales and purchasing figures are inclusive of GST.
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Assets:
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Cash (Bank)
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$245,000
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Computer equipment
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$16,400
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Delivery Van
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$26,000
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Phones
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$2,300
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Office Equipment
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$4,500
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Debtors
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$13,580
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Stock
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$117,303
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Expenses
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Phone Service / Calls
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$780
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Electricity
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$1590
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Gas
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$600
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Water
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$550
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Insurance
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$1300
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Payroll
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$465,000
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Cleaning
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$850
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Finance Costs
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$1650
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Advertising
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$560
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Rent
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$25,000
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Petrol
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$560
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Accountants Fees
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$370
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Maintenance
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$1405
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Bank Fees
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$210
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Office Supplies
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$600
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Creditors:
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JRL Holdings
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$22,626
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Innovating Technology Ltd
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$3,653
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LMS Marketing
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$1,200
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Rowlings & Sons
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$35,622
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Marek has 3 customers that order supplies from him on a regular basis and he delivers to their premises. To keep these customers happy, Marek is providing this service on credit to the customers listed below. The listed customers have a debt owing to Marek as listed:
Debtors:
P. L Farthings $1,323
J Smyth & Co $800
L.L Incorporated $356
National Appliances Direct $4,233
Appendix B - Cherokee Hospitality Equipment & Supplies Assumptions for 20XX financial year
Following research on market trends and consumer confidence, as well as inflation and other factors, Marek has provided you with the following set of assumptions for the 20)0( business year.
1. Purchase cost of goods is set to rise by 5%
2. Decreased consumer confidence means that sales are expected to decrease by 12%
3. Marek believes he can increase his sale prices by 8% which should have minimal impact on overall sales, perhaps reducing total sales by a further 3%
4. Marek plans on reducing his expenses by laying off one of his part time staff members who has a yearly salary of $47,000. This is hoped to have only minimal impact on productivity, however a decrease