Business Finance and Economics

Business Finance and Economics

Contents
Contents...........................................................................................................................................2
Introduction......................................................................................................................................3
Main Body.......................................................................................................................................3
Outline the major determinants that influence business performance as well as
distinguish whether they are microeconomic or macroeconomic. Discussion on the economic
factors which influence an organization's competitive environment:..........................................3
Explain role of the accounting in an organization and emphasize its significance in terms of
reporting as well as decision-making:.........................................................................................5
Differentiate from the main financial statements as well as describe the structure and terms
included in each:..........................................................................................................................6
Calculate and interpret the following ratios for XYZ Plc for the years ended March 31 2019
and 2020, respectively:................................................................................................................7
Define the management accounting and explain why it is vital for organizational planning,
monitoring, and decision-making:...............................................................................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11

Introduction
Business finance known as the corporate finance in business world, relates to allocating
capital, developing economic forecasts, evaluating equity as well as debt funding options, and
performing other operations within the company (Melé, Rosanas and Fontrodona, 2017). Small
companies, on the whole, do not have large finance team, but these roles may be present in the
organization. The study covers different tasks covering multiple aspects of business finance like
role of accounting, micro and macro factors affecting business environment, ratio analysis as
well as through discussion on concept of management accounting.
Main Body
Outline the major determinants that influence business performance as well as
distinguish whether they are microeconomic or macroeconomic. Discussion on the
economic factors which influence an organization's competitive environment:
In external business environment, there're two types of components: micro as well as macro.
These external forces are beyond businesses' power, but they do have an impact on decisions
taken while developing a tactical business model.
Factors in the Microenvironment
Suppliers: If suppliers have power, they will influence the company's performance.
When supplier is the sole or main distributor to their products; the customer is not critical
to supplier's operation; and supplier's inventory is an integral part of purchaser's end product
and business, supplier possesses control.
Resellers: Whether a company's product is sold by third-party resellers or industry intermediaries
like retailers, wholesalers, including distributors, those resellers have an effect on the company 's
business performance. If retail vendor has a good reputation, for instance, this could be used to
advertise the product.
Customers: How business sell their items / products/services to them will be heavily influenced
by who are their customers (B2B or Business to customer, regional or foreign, etc.) as well
as their motives for purchasing the product (Pendley, 2018).
The competition: The business competition consists of those that offer the same or even similar
goods and services as corporation, as well as the manner they sell must be considered. What

influence do price differences and products differentiation have on business? How
does business use this to improve your performance and also get ahead of competition?
The public at large: company has a responsibility to the general public. Every action taken by the
organization must be seen through the eyes of general public as well as how it affects them. The
general populace has the ability to assist business in achieving thier objectives as well as to
discourage from doing so.
Macro Environment Factors
Demographic forces: Popular demographic forces, such as country/region; age group; ethnicity;
educational attainment; family lifestyle; cultural factors and trends, all have an effect on different
consumer segments.
Economic: factors Both organization's efficiency and the customer's decision-making processes
are affected by the economic climate.
Natural/physical forces: This is essential to consider the Earth's regeneration of environmental
resource base like trees, farm commodities, marine products, and so on. Traditional non -
renewable resources including such oil, coals, minerals, and others can also have an effect on the
organization's production.
Technological factors: The expertise and experience used in manufacturing, as well as the
technologies and materials used for production of goods and services, may all have an effect on
the corporation's smooth operation and should be taken into account.
Political and regulatory forces: When making marketing decisions, that's crucial to keep in mind
the organization's and marketplaces' political and legal changes (Fields, 2016).
Social and cultural forces: Social as well as cultural influence of the goods and services company
brings to marketplace should be addressed. To demonstrate that the company is socially
responsible, all aspects of the manufacturing process or products lines which are detrimental to
societies should be removed. The environment is recent instance of this, with many industries
being compelled to rethink their products/services in attempt to become environmentally
sustainable.
Environmental factors like micro as well as macro variables have a direct effect on the
performance of marketing campaigns, so they must be carefully considered during development
of strategic marketing strategy. These considerations would boost the long-term effectiveness of
your company's marketing strategy as well as the brand's credibility.