Business Finance: Cost Classification, Cost Reduction Strategy, and Cash Flow Forecasting

Business Finance

Contents
INTRODUCTION...........................................................................................................................................3
TASK 1..........................................................................................................................................................3
Classify cost according to behaviour........................................................................................................3
TASK 2..........................................................................................................................................................5
Discuss the judgments and conclusions based on cost reduction strategy.............................................5
TASK 3..........................................................................................................................................................5
Preparation a 12 - month forecast/budget for the business up to 30 April 2023....................................5
TASK 4........................................................................................................................................................11
Clear justifications are needed to support the conclusions and recommendations made in your
evaluation..............................................................................................................................................11
CONCLUSION.............................................................................................................................................11
REFERENCES..............................................................................................................................................13

INTRODUCTION
Finance is the backbone of any firm. It is nearly hard to prosper lacking solid financial
backing. Business finance refers to the finances and credit used in a business. Financial is the
underpinning of any firm. Finance is required to acquire property, products, natural resources,
and other enabling business (Beladi, Deng, and Hu, 2021). Financial management can give the tools
needed to devise solutions to address the deficit. Dysonica is a large multinational inventive firm
that was founded in the United Kingdom but now works globally. Its items are accessible on the
main street and also internet. Competitive pressure has resulted in several price initiatives,
including the relocation of production from the United Kingdom.
TASK 1
Classify cost according to behaviour
Fixed cost:
Factory and storage rent: 18000 per month = 18000*12 = 216000
Insurance: 500 per month = 500*12 = 6000
Machinery: 1500 per month = 1500*12 = 18000
Utilities: 500 per month = 500*12 = 6000
Variable Cost:
Direct labour: 17500 per month
Raw material: 15000
Semi variable cost:
Office and sales staff: 9000 per month = 9000*12 = 18000
Logistics cost: 3000 per month
Fixed Costs £ Variable Costs £ Semi-variable
Costs
£