Home > Flashcards > Print Preview
The flashcards below were created by user
on FreezingBlue Flashcards. What would you like to do?
Could you provide a business plan and explain it?
YES, refer to your business plan
What is financial control?
defining and managing the income and expenses of a business.
How would you apply financial control to your business?
Through "profit and loss" statements and cash flow projections
Do you know how to prepare a budget?
Yes. Refer to your prepared budget.
How do cost control, estimating and accounting work together?
- -cost control is about keeping your costs on schedule and within budget
- -estimating and accounting work by comparing the "estimated price" with the actual price to see if they match and are on schedule
How do you monitor a project to see if your on budget?
- -by matching delivery dockets, cash receipts, etc to your invoices and cost estimation sheets for the job.
- -done on a daily basis, any differences investigated so you can adjust to stay within your contract price
What are the differences between sole trader, a partnership and a company?
- -Sole trader is the only owner of the business
- -Partnership, could be 2 or more people on a 50/50 basis or other %'s
- -A Company; must have at least 1 shareholder and 1 Director and must submit an annual return. A companies director must attest to the companies solvency each year
Do you understand what a 'cash flow budget' is?
YES. refer to attached C.F.B
How would you prepare a budget for a spec home?
Some areas to think about would be overhead costs, preparation of plans, specifications, bank loan, site preparation costs, connection costs, material costs, labour/sub-contractor costs, government fees and charges, advertising charges and not forgetting your own time.
How would you prepare a budget for an order job with progress payments?
Follow the progress payment format as per MBAV, domestic building contract under method "A" progress stages are set out for you and cannot be changed unless you get an 'agreement' signed by the 'client', or "nominated party" to alter the claims format.
What are liabilities/assets?
- Liabilities are outstanding monies the business is obliged to pay, or goods/services owed by the business.
- Assets are resources that are owned by the business, like property, plant, vehicles or cash.
- Assets can also be these things including goods and services owed to the business by external parties
Explain the difference between leasing and renting?
- -Leasing is the common form of equipment finance with considerable taxation advantages
- -Renting is an on-going agreed payment usually by the month, for a set time, e.g.,weeks/months or years.
Explain Credit and Debits?
- Credit is monies received.
- Debit is monies owed.
Explain Gross Profit/Net Profit?
- Gross profit is the "all inclusive" gross amount figure
- Net profit is the total amount after all expenses have been paid out.
what is taxable income, how does it differ from gross income?
- taxable income means that it has a tax component applied to it like GST
- gross income still has a debt component in the total figure
What is an ABN?
its a "single identifying number" used when dealing with government departments and agencies
Explain the GST system and how it applies to building?
GST is a broad based tax of 10% on most goods and services
When setting a margin cost what do you need to consider?
- MARK UP & MARGIN whats the difference?
- Mark up is a percentage of the cost
- Margin is the same dollar amount expressed as a percentage of the selling price.
- Sales, Expenses and Profit
- You will have to look inside your business, taking into account sale, expenses, and profits b4 setting prices
- Do you know what your direct competitors are doing price wise?
Name overhead expenses?
rent, utilities, and insurance
what trading terms would u offer to sub-contractors?
purchased using a building works order and either a HIA's subcontract agreement and in accordance with workmanship inspection report from quality inspection procedures.
what costs would you need to consider when calculating a labour charge out rates?
- wages of direct labour employees
- holiday pay
- payroll tax
- work cover
- provisions for long service leave
considering projected cash flow, why would a business run out of cash in any 12 month period?
expenses become greater than income.
what other details need to be on a tax invoice?
- must have wording, "TAX INVOICE"
- COMPANY NAME, ADDRESS, & ABN
- should show SUB TOTAL, GST amount, TOTAL inc.gst
define: BAS, ABN, PAYG, BAS
- BAS: is a form submitted to the ATO by all businesses to report their tax obligations.
- These include Pay as you Go Withholding(PAYGW), Pay as You Go Installments(PAYGI), Fringe Benefit Tax(FBT), Wine Equalisation Tax(WET) and Luxury Car Tax(LCT)
At what dollar amount must your business register for GST?
What information is shown on a profit & loss statement?
- shows; earnings,
- net profit
- net income is determined by subtracting total expenses from total revenue
What information is shown on a balance sheet?
- snapshot of companys' holdings at a given point in time
- shows assets, liabilities it owes and accumulated investments of the owner
What is retained earnings?
- earnings not paid out as dividends, but instead reinvested in its core business or used to pay off debt.
- retained earnings(RE)=
- Beginning RE + Net income - Dividends