FNSACC503 Manage Budgets And Forecasts: Assessment Task 1

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Question :

Assessment Task 1: Written Questions

Task summary 

This is an open book test, to be completed in the classroom.

A time limit of 1.5 hours to answer the questions is provided.

You need to answer all of the written questions correctly.

Your answers must be word processed and sent to the assessor as an email attachment. 


  • Access to textbooks/other learning materials
  • Computer and Microsoft Office
  • Access to the internet


Your assessor will advise you of the due date of this assessment.


  • Answers to all questions 

Assessment Task 1 Instructions

Provide answers to all of the questions below: 

1. Discuss the key purpose and objectives of budgeting. 

2. Discuss the key purpose and objectives of forecasting. 

3. Discuss why key performance indicators are used in budgeting and forecasting and provide three examples of financial key performance indicators.

4. Discuss why milestones are used in budgeting and forecasting. 

5. Discuss ethical considerations for budgetary forecasting and projections taking into account the strength of budget assumptions and forecast reliabilities. 

6. Describe at least two types of information and data that a company can use for budgeting and forecasting. Ensure that your answer also includes the source of the information and data.

7. Outline the information you may use to forecast sales, and the different information you would need to forecast production. 

8. Explain fixed costs in a budgeting context and provide an example of a fixed cost.

9. Explain the characteristics of variable costs.

10. Compare and contrast two forecasting techniques, including the different circumstances in which these might be used. 

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Answer :

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