FNSTPB402 Establish and Maintain a Payroll System Assessment 2 Answer
Question 1 –FBT & Superannuation (4 marks)
- How does a business report and pay FBT to the ATO? (1 mark)
- What is the difference between a GST Free Sales and Input Taxed Sales? (1 marks)
- Are Superannuation Guarantee amounts subject to GST? (1 mark)
- Are Superannuation Guarantee amounts reported in the BAS? (1 mark)
Question 2 – Lodge Activity Statement (4 marks)
You are the assistant accountant and it is your role to prepare the BAS of the business. You are not an authorised person. However, your immediate manager is the financial controller who is also the public officer of the company.
You have prepared the BAS statement and it’s ready for lodgement.
- Can you sign off the BAS? (2 marks)
- You have just found out that your manager has left for overseas for 3 days and the BAS is due tomorrow. Who will sign the BAS and lodge it? (2 marks)
Question 3– GST Classifications (16 marks)
All supplies fall into the following categories, regardless whether they are inputs or outputs:
- Taxable (10% rate) (4 marks)
- GST free (zero rated) (4 Marks)
- Input taxed (no rate) (4 Marks)
- Exempt (4 Marks)
Indicate with an ‘X’ which category the following supplies fall into:
|Wages or Superannuation paid or received||X|
|All supplies out for exported goods or services||X|
|Residential rent income or expenses||X|
|Money (lent, borrowed, accounts)||X|
|Domestic water sales||X|
|Purchase or sale of an asset||X|
|Commercial rent income or expenses||X|
|Childcare & education||X|
Question 4– BAS Case Study (28 marks)
Do not deduct mark for consequential errors.
Boosting Sales is registered for GST as a cash payer and has chosen to report and calculate its GST every quarter. As a bookkeeper, part of your job description is to complete the quarterly BAS (under the direction of your client’s tax agent).
The following was extracted from the accounts for the quarter ended 31December 2016.
Complete the followings:
a) GST Classification Worksheet for BAS purposes (12 Marks)
b) GST Calculation Worksheet for BAS purposes (12 Marks)
c) When is the payment due date? (2 Marks)
d) Enter the journal entry to process the payment. (2 Marks)
Note: All values are GST inclusive (wherever applicable)
|Sales of goods and services||440,000|
|Other GST-free sales||6,600|
|Sale of Assets||5,500|
|General Business Expenses||220,000|
|Business Council & Water Rates||2,200|
|Commercial Rent Expenses||9,900|
|Residential Rent Expenses||4,400|
|Purchase of Fax Machine||2,200|
|Wages & Salaries||88,000|
|PAYG tax withheld||25,000|
a) GST Classification worksheet 0kay
|Account Details||Outputs||Taxable||Exports||GST- Free||Input Taxed||Excluded|
|Sale of goods & services||440,000||440,000|
|Sale of assets||5,500||5,500|
|Other GST-free sales||6,600||6,600|
|GST Classification Worksheet Reference||G1||G6||G2||G3||G4|
|Account Details||Inputs||Capital Purchases||Non Capital Purchases||Taxable Supply||Input Taxed||GST Free||Excluded|
|General Business expenses||220,000||220,000||220,000|
|Business council & water rates||2,200||2,200||2,200|
|Commercial rent expenses||9,900||9,900||9,900|
|Residential rent expenses||4,400||4,400||4,400|
|Purchase of Fax Machine||2,200||2,200||2,200|
|Wages & salaries||88,000||88,000|
|GST Classification Worksheet Reference||G10||G11||G17||G13||G14||Excluded|
|G1||Total Sales (including any GST)|
|G10||Capital Purchases (including any GST)||2,200|
|G11||Non-Capital Purchases (including any GST)||236,500|
|G3||Other GST –Free Sales||6,600||G12||G10 + G11||238,700|
|G4||Input Taxed Sales||22,000||G13||Purchases for making Input Taxed Sales||4,400|
|G5||G2 + G3 + G4||36,300||G14||Purchases without GST in the price||2,200|
|G6||Total Sales subject to GST (G1 minus G5)||544,500||G15||Estimated Purchases for Private Use or not Income Tax Deductible||0|
|G7||Adjustments (if applicable)||G16||G13 + G14 + G15||6,600|
|G8||Total Sales subject to GST after Adjustments (G6 +G7)||544,500||G17||Total Purchases subject to GST (G12 minus G16)||232,100|
|G9||GST on Sales (G8 divided by eleven)||49,500||G18||Adjustments (if applicable)||0|
|G19||Total Purchases subject to GST after Adjustments (G17 + G18)||232,100|
|G20||GST on Purchases (G19 divided by eleven)||21,100|
|NET GST PAYABLE |
(G9 minus G20)
b) GST Calculation Worksheet for the quarter ended 31 December 2014:
c) Payment due date:28 February 2017
d) Journal entry to record the payment:
|Date||Particulars||Debit ($)||Credit ($)|
Question 5 – PAYG WITHHOLDING (8 marks)
Below is an extract from weekly tax tables.
|Weekly earnings||With tax-free threshold||No tax free-free threshold|
The correct amount of tax to withhold (if any) from a resident employee earning $409 per week, who has not quoted a TFN but has requested the tax-free threshold is
The correct amount of tax to withhold (if any) from a resident employee earning $408 per week, who has quoted a TFN and requested No tax-free threshold
The correct amount of tax to withhold (if any) from a resident employee earning $410 who has quoted a TFN and requested the tax-free threshold
The correct amount of tax to withhold (if any) from a non-resident employee earning $407 who has quoted a TFN.
Question 6– Cashflow (8 mark)
Jumping Jacks Pty Ltd has provided an extract of their forecasted cash flow and you have prepared the BAS for the September quarter, the payment due as shown on the BAS is $30,000.
Extracted forecasted cash flow
|Estimated Closing bank balance||$20,000||($50,000)||($40,000)||$10,000|
- Jumping Jack’s Pty Ltd reports and pays GST quarterly. From the above information what would you bring to the attention of your client regarding the payment of the $30,000 shown on the BAS? (4 Marks)
- What action could Jumping Jack’s Pty Ltd take to meet their BAS payment obligations? (4 Marks)
Question 7–PAYG Instalments (8 marks)
Rinaan Little operates a small business and receives investment income. She accounts for GST and PAYG Instalments on a cash basis, reports GST annually and reports PAYG instalment income quarterly.
This is a list of revenue (GST inclusive where applicable) received for the October - December 2016 quarter by Rinaan Little:
|Commercial rent received||$ 33,000|
|Residential rent received||$ 7,700|
|Interest received||$ 1,100|
|Dividend income||$ 3,300|
|Sale of business printer (*asset )||$ 2,200|
|Bank Loan – Bank of Australia||$ 4,400|
- Calculate the PAYG instalment income.
- Calculate the PAYG income tax instalment assuming a PAYG income tax instalment rate of 6.20%
- Prepare the Instalment Activity Statement for the quarter using option 2.
|Amount including GST||PAYG Instalment Income|
|Commercial rent received|
|Residential rent received|
|Sale of business printer|
|Bank Loan – Bank of Australia|
|PAYG Instalment income|
(c) Complete the required BAS labels below:
Question 8 Adjustments (6 marks)
You are given some unrelated examples of errors/ omissions that were made on prior BAS reports. Advise whether they are errors requiring lodgement of a Revised Activity Statement or adjustments (increasing / decreasing) to account for when lodging the next BAS.
|Error / Omission||Select one appropriate solution from the following:|
|A sale of $1,100 from the last quarterly BAS was recorded as GST-free|
|A previous purchase of $14,000 included in a prior BAS has been cancelled|
|An amount of $50 discount provided to customers|
Question 9– Handle Payroll Queries (10 marks)
- An employee has contacted you requesting details of his total superannuation payments. His wife also works for the same company and he also requested, on behalf of his wife, details of her total superannuation payments. He would like a total year to date figure for him and his wife.
What advice would you provide?
- An employee asked you, "How the Superannuation Guarantee is calculated?"
- An employee’s mother has passed away.
How much compassionate leave are they entitled to?
- An employee asked you, "Payroll records must be kept for what period of time?"
- A casual employee asked you, "What is the casual rate loading?"
|All the details are private, and we can give any details without permission|
|To have the access to superannuation|
|7 year We have the access to payroll register records|
Question 10 – Processing Payroll(8 marks)
for Week Ending 30 June
|Entitlements||D. Cameron||F. Smith||P. Adams||C. Border||Total|
|Ordinary Hours Worked||Nil||$1,995.00||$1,904.00||$1,500.00||$5,399.00|
|Personal Leave Hours||Nil||Nil||$476.00||$1,000.00||$1,476.00|
|Overtime Hours (x1.5)||Nil||$256.50||Nil||N/A||$256.60|
|Overtime Hours (x2.0)||Nil||$114.00||Nil||Nil||$114.00|
|Annual Leave Loading||$420.00||Nil||Nil||Nil||$420.00|
|Hourly Pay Rates|
|D. Cameron||F. Smith||P. Adams||C. Border|
|$57.00 per hour||$57.00 per hour||$42.00 per hour||$50.00 per hour|
Complete the Pay Advice Slip for C. Border for the week ending 30 June.
Pay Advice Slip
|Employer: Sam Waterford|
|Employer’s ABN: 11 111 111 111|
|Employee: C Border|
|Week ending: 30 June|
|Date of Pay: 30 June|
|First Aid Allowance|
|Super fund Name:||Sun Superfund||Amount|