Advanced Diploma in Business
HP70 48 : Preparing Financial Forecasts
This 1-credit financial Unit contains four Outcomes although it is recommended that the delivery and assessment of Outcomes 1 and 2 be combined and that the delivery and assessment of Outcomes 3 and 4 be combined also.
Outcome 1 covers the preparation of an operating statement and the classification of costs into direct and indirect. Students also learn about the analysis of overhead costs and methods of determining profit using mark-up and margin.
Outcome 2 further develops the analysis of costs for a business through marginal costing to provide relevant data for decision making. This Outcome also looks at the effect of changing costs and revenue levels on the total contribution made by the goods and services an organisation produces.
Outcome 3 introduces students to the important business process of budgeting and covers the preparation of functional budgets and flexed budgets. Further, students will calculate variances between budgeted and actual revenues and costs for an organisation.
Outcome 4 involves the use of investment and project appraisal techniques to assess the viability of a project. These techniques include traditional and discounted cash flow and their uses in decision making.
The use of a spreadsheet package is encouraged for Outcomes 3 and 4.