BSBFIM501 Manage Budgets And Financial Plans - Assignment Help

BSBFIM501 Assessment 4 Task A:

As you are aware, one risk to the strategic plans of Big Red Bicycle (BRB) is bad debt and poor cash flow due to large trade debtor balances. Consider the following:
• According to its policies, BRB offers 30 day terms to debtors.
• BRB does not currently train sales staff on credit terms.
. There is currently no enforcement of credit terms.
& Warehousing of stock is expensive at current leased premises.
Many bicycles need to be thrown out if parts rust; this problem exacerbates the problem of waste expense. You have the following information from the Statement of Financial Position and current ledger accounts in the electronic accounting system (MYOB AccountRight).

Account                           $
Trade debtors          362,500
Trade creditors       80,000
Opening stock         100,000
Closing stock            300,000
    Purchases                  1,000,000

Complete the following. 

1. 1. Review the Statement of Financial Performance in Appendix 2 to calculate: 
2. The average debtor days b. The average creditor days 
3. The average stock turnover d. Show calculations and results on your response document for this assessment task. 

2. Consider the existing BRB ageing debtors budget in Appendix 2. On your 

response document, make two written recommendations for improvement to existing financial management processes to improve cash flow. To support your recommendations, refer to data sources, organisational needs, and analytical techniques, for example: 

1. a. Statement of Financial Performance 
2. b. ledger accounts Scenario information 
3. ageing debtors budget 
4. e. ratios. 
5. On your response document, list three sources of information of use to complete this activity.