Business Finance: Elements of Financial Statements, Budget Formation, and Cost Management

Business Finance

Table of Contents
PART A...........................................................................................................................................1
Executive summary......................................................................................................................1
i) Different Elements of financial statements..............................................................................1
ii) Implementation of concepts....................................................................................................3
iii) Recommendation....................................................................................................................4
PART B............................................................................................................................................5
Executive summary......................................................................................................................5
i) Understating of budget formation............................................................................................5
ii) Implanting of methods and cost management.........................................................................7
iii) Evaluation of traditional or alternative budgetary system for company................................8
REFERENCERS .............................................................................................................................9

PART A
Executive summary
Business financing can be described as the capital that companies have used to work out
the entire operating tasks in a specific period of time. In case if it is absent, it can impact the
quality of company procedures (Antony and Bhattacharyya, 2010). The first part is focused on
the service of Bright Lawns Ltd. that is located in Birmingham and Manchester, London. The
report covers meaning of profit, cash flow, working capital, payables and inventory. In addition,
concepts and impact of working capital analysed has been analysed.
i) Different Elements of financial statements.
Profit: This can be characterized as an organization's monetary gain by supplying certain
goods and services to customers. The accounting practitioners in a company are expected to
exclude expenses from the amount earned from sale events before estimating profit figures.
Every revenue generated after the costs have been deducted is referred to as income level for a
year. It is primarily evaluated by investors in order to measure a firm's performance and profit-
generating potential.
Cash flow: In order to facilitate the mechanism of conducting out operating operations,
the amount of financial resources that are exchanged into and out of a business is known as total
cash flow. In other terms, the method where money moves from a company to perform specific
task and the total money received from these activities is known as cash flow (Dees, 2016). At
the conclusion of every year, this cash flow statements are written by considering the real
accounts.
Comparison
Cash flow Profit
Shareholders use this statement to calculate the
firm's profitability.
Shareholders must examine the capacity of the
company to make profits in respective period.
This is determined by subtracting total cash
flows from actual inflows to asses monetary
funds.
In order to assess the profit margin accountant
consider each cost and subtract from sales
figure.
Proper and authentic cash flow statement is In order to extract the actual profit figures
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