Assignment Front Sheet

Qualification

Unit number and title

Pearson BTEC Level 5,

HND Business (Accounting)

Unit 9: Management Accounting: Costing and Budgeting

Unit code: R/601/0836
Credit value: 15 credits

Student name

Assessor name
Faraz Ahmad

Date issued

Completion date

Submitted on

Assignment title

Skills in the Costing and Budgeting

Validity

Assignment no

Hand-in Policy
You must complete this assignment on time. If you experience difficulties, you must inform your
tutor accordingly.
Late Work Policy
Consideration will be given to students who have valid reasons for late submission (eg, illness).
Plagiarism
In cases of plagiarism, college regulations will be applied. You must declare that this assessment is your
own work by signing the following statement:

Learner declaration
I certify that the work submitted for this assignment is my own and research sources are fully
acknowledged.

Student signature:

Date:

Assessment Criteria

Learning
Outcome

LO1

LO2

LO3

Learning
outcome

Be able to
analyse
cost
informatio
n within a
business

Be able to
propose
methods to
reduce
costs and
enhance
value within
a business

Be able to
prepare
forecasts
and
budgets for
a business

Assessmen
t Criteria

LO4

Task Evidence
no. (Page no)

1.1

Classify different types of cost

1.2

Use appropriate costing method

1.3

Calculate costs using appropriate

techniques

1.4

Analyse cost data using appropriate

techniques

2.1

Prepare and analyse routine cost reports

2.2

Use performance indicators to identify

potential improvements

2.3

Suggest improvements to reduce

costs, enhance value and quality

3.1

Explain the purpose and nature of the

budgeting process

3.2

Select appropriate budgeting methods

for the organisation and its needs

3.3

Prepare budgets according to the

chosen budgeting method

3.4

Prepare a cash budget

4.1
Be able to
monitor
performance
against
budgets
within a
business

In this assessment you will have the

opportunity to present evidence that
shows you are able to:

4.2

4.3

Calculate variances, identify possible

causes and recommend corrective
action
Prepare an operating statement
reconciling budgeted and actual
results
Report findings to management in
accordance with identified responsibility
centres

4
4

In addition to the above PASS criteria, this assignment gives you the opportunity to submit evidence in order to achieve the following MERIT
and DISTINCTION grades
Grade Descriptor
M1 Identify and apply strategies to find
appropriate solutions

Indicative characteristic/s

An effective approach to study and research

has been applied
Effective judgements have been made

M2 Select / design and apply appropriate

methods / techniques

D2 Take responsibility for managing and

organising activities

A range of sources of information has been

used
Relevant theories and techniques have been
applied

Autonomy/independence has been

demonstrated
Substantial activities, projects or
investigations have been planned, managed
and organized

Contextualisation
To achieve M1, an effective approach to study and research
has been applied (Task 1)
To achieve M1, an effective judgements have been made,
an effective approach to study and research has been
applied (Task 2)
To achieve M1, an effective approach to study and research
has been applied, effective judgements have been made
(Task 3)
To achieve M2, a range of sources of information has been
used (Task 1)
To achieve M2 a range of sources of information has been
used, relevant theories and techniques have been applied
(Task 3)
To achieve D2 autonomy/independence has been
demonstrated, substantial activities, projects or
investigations have been planned, managed and organised
(Tasks 1)
To achieve D2 autonomy/independence has been
demonstrated, substantial activities, projects or
investigations have been planned, managed and organised
(Task 2)
To achieve D2, substantial activities, projects or
investigations have been planned, managed and organised,
autonomy/independence has been demonstrated. (Task 3)

D3 Demonstrate convergent /lateral /

creative thinking
Please note that for unit assignments assessors should use these or other exemplar indicative characteristics for the individual
grade descriptors from Annexe C of the HN specification or any other relevant indicative characteristics for the particular
assignment. The indicative characteristic should then be contextualised. Only one indicative characteristic per grade descriptor, M1
M2, M2, M3, D1, D2, and D3 is required.

Assignment brief

Unit Name number and

title

Unit 9: Management Accounting: Costing and Budgeting

Unit code: R/601/0836
Credit value: 15 credits

Qualification

Pearson BTEC Level 5, HND Business (Accounting)

Start date

3rd December 2013

Deadline/hand-in

3rd January 2013

Assessor

Faraz Ahmad

Assignment title

Skills in the Costing and Budgeting

Scenario
Managing costs is a critical challenge faced by modern businesses and vital to all stakeholders.
TMRC is the renowned management consultancy firm that provides management consultancy and
advisory to various domestic clients. You are acting as Management Trainee Officer in consulting and are
asked to show your ability to analyse cost information within a business, propose methods to reduce costs
and enhance value within a business, prepare forecasts and budgets for a business and monitor
performance against budgets within a business.
To achieve this you are required to select a business for which cost data access is available to
you in order to be able to perform tasks given below. You can also use different cost data of
different businesses in difference tasks if you face problems with access of data.

Task 1 (LO1: 1.1, 1.2, 1.3, 1.4 and M1, M2, D2)
Be able to analyse cost information within a business
In order to achieve this, you need to:

Classify different types of cost

Use appropriate costing method

Calculate costs using appropriate techniques

Analyse cost data using appropriate techniques

Task 2 (LO2: 2.1, 2.2, 2.3 and M1, M2, D2)

Be able to propose methods to reduce costs and enhance value within a business
In order to achieve this, you need to:

Prepare and analyse routine cost reports

Use performance indicators to identify potential improvements

Suggest improvements to reduce costs, enhance value and quality

Task 3 (LO3: 3.1, 3.2, 3.3, 3.4 and M1, M2, D2)
Be able to prepare forecasts and budgets for a business
In order to achieve this, you need to:

Explain the purpose and nature of the budgeting process

Select appropriate budgeting methods for the organisation and its needs

Prepare budgets according to the chosen budgeting method

Prepare a cash budget

Task 4 (LO3: 4.1, 4.2, 4.3 and M1, M2, D2)

Be able to prepare forecasts and budgets for a business
In order to achieve this, you need to:

Calculate variances, identify possible causes and recommend corrective action

Prepare an operating statement reconciling budgeted and actual results

Report findings to management in accordance with identified responsibility centres

Evidence
checklist

Summary of evidence required by student

Task 1

Classification of different costs in the scenario one and their brief

explanation. Explain different types of costing methods and which method
would be suitable in the given scenario and why? Computation of equivalent
units, unit costs and total cost analysis

Task 2

Report on the analysis of routine cost and suggestion for performance

indicators.

Task 3

Task 4

Prepare forecast and budget for business and report your findings to the
management
Prepare a deviation report and discuss possible clauses and their corrective
measures. Prepare an operating statement and Report your findings to the
management

Evidence
presented

Submission guidelines
You must:
Complete all tasks

Present your work in one business report-style document which should include a table of
contents, references list, foot or end notes if any and appendices if any.

Complete, sign and submit the usual statement of authenticity.

Produce clear specific reasoning and arguments in support of your answers.

Submit your work in a single word processed document of 4000-5000 approx .words. This word
limit is only for guidance and is not applied on grading.
Make appropriate reference to the relevant concepts, techniques and theories.
Appropriately cite all information success (in the text and bibliography) as per references
guidelines given to you before.

Reading Materials
Textbooks
Hilton, R. W. (1994). Managerial accounting. London: McGraw-Hill.
Business study guide, Level 4 & 5, Edexcel (2011, Pearson Education Limited), ISBN 978085776003
D. Michael Stretchberry, Gerald F. Hein, (Va., 1972) General Methodology: Costing, Budgeting, and
Techniques for Benefit-cost and Cost-effectiveness Analysis
NASA technical memorandum, National Aeronautics and Space Administration; reproduced [and distributed]
by National Technical Information Service, Springfield
Journals
Puxty, A. G., & Lyall, D. (1989). Cost Control into the 1990s: A survey of standard costing and budgeting
practices in the UK (pp. 44-45). Chartered Institute of Management Accountants.
Preston, A. M., Cooper, D. J., & Coombs, R. W. (1992). Fabricating budgets: a study of the production of
management budgeting in the National Health Service. Accounting, Organizations and Society, 17(6), 561593.
Alam, M., & Lawrence, S. (1994). A new era in costing and budgeting: implications of health sector reform
in New Zealand. International Journal of Public Sector Management, 7(6), 41-51.
Heath, C. (1995). Escalation and de-escalation of commitment in response to sunk costs: The role of
budgeting in mental accounting. Organizational Behavior and Human Decision Processes, 62(1), 38-54.
Knippenberg, R., Soucat, A., & Vanlerberghe, W. (2003). Marginal Budgeting for Bottlenecks: A tool for
performance based planning of health and nutrition services for achieving Millennium Development
Goals. World Bank, UNICEF, WHO.
Websites
www.jiscinfonet.ac.uk
www.businessdictionary.com
www.euromatech.com
www.digitallibrary.edu.pk