Finance and Funding in Travel Tourism Assignment

Added on - 06 Jun 2020

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Finance and Funding
Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................11.1 Importance of costs and volume in financial management...................................................11.2 Pricing methods used in travel and tourism sector................................................................21.3 Analysis of different factors which influence profitability of travel and tourism.................4TASK 2............................................................................................................................................52.1 Different kind of management accounting information which used in tourism sector.........52.2 Assess the use of investment appraisal management accounting information as decisionmaking tool..................................................................................................................................6TASK 3............................................................................................................................................73.1 Interpretation of financial accounts to assist decision-making.............................................7TASK 4............................................................................................................................................94.1 Different sources and distribution of development of capital projects.................................9CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................11
INTRODUCTIONFor a business organisation it is required to manage their financial sources in appropriatemanner to getting desired growth and success easily. For this they needs to manage their liquidityfunds to build a positive bridge in target market. Travel and tourism is one of the fastest growingindustry in UK that provide its effective services to inbound, local and outbound tourists. Forthem it is required to manage their financial sources to earn long term benefits. This projectreports is based on The Akaglo Tours Company which is planning to prepare holiday trip forMaldives. For them it is required to manage financial sources and funds to build future successproperly (Evans, Stonehouse and Campbell, 2012). This reports includes importance of cost andvolumes as well as analysis of different factors that influence profitability in tourism sector. Italso determine use of investment appraisal management accounting information andinterpretation of financial account. At last it represent different sources and distribution ofdevelopment of capital projects.TASK 11.1 Importance of costs and volume in financial managementFor a business organisation it is required to analyse values of their products and servicescost to make appropriate easily. Through this they can easily get higher profit and desirablesuccess in future. In The Akaglo Tours Company, industries needs to manage their funds andreserve to offer quality and attractive services to their target customers. This is one of the fastestgrowing industry in world wide, so for this government of UK provide their own contribution tomaximise its size easily. In this process, cost and volume of organisational services play theirown role in front of tourist and visitors as-Cost –This is known as an appropriate amount of values and things that has to be paid to getsomething easily. Cost is mandatory values that has been used to produce several things andservices. In it, organisation can easily add their revenue and profits that they need to earn on thebehalf of their services (Henderson, 2010).Direct cost – These type of cost are directly accountable as cost objective in whichorganisation includes operating cots, efforts and expenses that requires to cove throughfirm's services and products.
Indirect cost – These type of costs are not directly calculated as organisational objectivesand it can be either variable as well as fixed by its nature. It includes indirect expensesand values of organisational services as advertising, electricity bill and rent as well.Variable cost – These type of costs are variable by nature and it can be changes in severalproportion easily. Variable costs are basically depends on companies production andservices to make desirable changes. It can be rise and fall at any time as per company'sdemand and choice.Fixed cost –These type of costs are fixed by nature and organisation can not make anychanges in its nature by their own choice. Through this firm can easily serve impressiveand appropriate cost in front of their target customers.Volume –Itis used to analyse values and quantity of organisational products and services toanalyse different components easily. In travel and tourism sector there are various tools andtechniques are available to serve effective services to tourist. Volume is determine as -Break even analysisThis is an appropriate point in which organisation cover its overallcost thorough impactful strategy. This process is very beneficial in travel and tourismindustry that helps to cover overall cost of its expenses(Heung, Kucukusta and Song,2011).Economies of scaleIn this process travel and tourism sector serve its own contributionin economy growth. In UK Tourist industry provide higher growth and income.Diseconomies of scaleIn this procedure economy scale do not function so for this TheAkaglo Tours Company require to perform properly in several situations that can notaffect negatively in economy.1.2 Pricing methods used in travel and tourism sectorThe Akaglo Tours Company require to use effective pricing method to serve qualityservices to their customers in appropriate manner to pay their attention easily. These kind ofthings helps to capture customer's eyes toward different services packages. In this processorganisation needs to use effective methods to solve issues and problems that are related topricing methods oftravel and tourism sectors. For this organisation van use several techniques as-Seasonal pricing –In travel and tourism sector different organisation needs to makeeffective and appropriate changes according to different seasons. In this processThe Akaglo
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