(solved)Finance and Funding in Travel and Tourism Sector
Added on -2020-11-23
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Finance and Funding inTravel and TourismSector
Table of ContentsINTRODUCTION...........................................................................................................................3TASK 1............................................................................................................................................31.1 Importance of cost, volume and profits for financial management of Carnival Corporation& plc.......................................................................................................................................31.2 Pricing techniques which are used in travel and tourism sector.......................................61.3 Factors that influence profit in travel and tourism businesses.........................................7TASK 2............................................................................................................................................82.1 Different types of management accounting information..................................................82.2 Use of investment appraisal techniques as decision making tools.................................12TASK 3..........................................................................................................................................143.1 Interpretation of financial accounts of The Fulham Shore plc.......................................14TASK 4..........................................................................................................................................18Leaflet...................................................................................................................................18CONCLUSION..............................................................................................................................18REFERENCES..............................................................................................................................20
INTRODUCTIONFinance is a term which describe study of money, investments and financial instrumentsthat categorises in public, corporate and personal finance. Funding is an act of money which iscontributed by business owner for buying shares for company (Ambrose, 2012). In travel andtourism, their financial assistance is made on heritage hotels, restaurants, food courts, pubs,travel agents, etc. This report is based on Carnival Corporation which is British- Americancompany and world largest travel leisure company. Relevant importance of cost and volume withdifferent cruise brands of Carnival Corporation are addressed in this context. This report is goingto determine management accounting information in context to travel and tourism companyFulham Shore plc. An organisation interprets financial accounts of Fulham Shore plc and analysesources and distribution of funding of capital projects. TASK 11.1 Importance of cost, volume and profits for financial management of Carnival Corporation &plc Carnival Corporation & plc is a world largest travel leisure company with having 100vessel fleet across 10 cruise line brands. It is a merger of Carnival Corporation and Carnival plcwhich functioning as one entity. It is the only company which is listed in world on both S& P500 and FTSE 100 indices. Company provides quintessential holiday experience which based onguest capacity. Organisation is focusing on innovative design and wide array with choices indining, entertainment and amenities. Travel and tourism industry provides an attractive profit inbusiness scenario. Their major growth in industry seen in weekends and holidays. Travel andtourism industry are working through various aspects related with finance are define below:CostCost is a major part of travel and tourism that occur in tour packages of customers. Costestimation helps in achieving growth in Carnival Corporation & plc. In travel and tourismbusiness, cost is helpful in organising trip and providing relevant packages to customers. Direct cost – A direct cost is mainly defined as overall attributes included in productionprocess of particular good and services. But sometimes, direct cost is considered as variable also
in the case of inconsistent as well fluctuate in amount. For instance, salary paid by CarnivalCorporation & plc to their employees are consider as direct cost. Indirect cost – It is the cost which not directly occur while doing any activity of CarnivalCorporation & plc. Indirect cost may be fixed as well as variable both. Indirect cost areadvertising expenses, security, computing, maintenance and so on. Fixed cost – It is that cost or expense which does not change with the increasing ordecreasing in the number of goods and services sold and produced. For Carnival Corporation &plc it can be a beneficial term that assist them in offering appropriate cost to direct customers. Variable cost – It is the corporate expense which are change or alter in proportion alongwith producing specific output. This cost increment and decrement are depending on CarnivalCorporation & plc's production volume.Importance of costsIn travel and tourism sector cost help its owner in making decisions for enhancingsustainable growth and profitability. This is a systematic process which is adopted by businessorganisation. As a Trainee Business advisor, an organisation always focusses on cost bymaintaining quality of product and service. Cost reduction: It is an effective system in an organisation which increases profits.Travel and tourism sector are removing unwarranted expenses on product and services ofCarnival Corporation & plc. As a Trainee Business Advisor, this approach increasesoverall profits with reducing overheads. Decision-making: Decision making denotes as a process which is made by choices thatidentify, gather information and assess resolution. In context to travel and tourismindustry, manager make thoughtful decisions with relevant information and definealternatives. Decisions are made in regarding with prospects to competitors for achievingsustainable growth (Donaldson, 2013). VolumeVolume is defined as a quantity which enclosed by the capacity of travellers as approx.2500 to 3000 members. It defines level of production in quantity terms. Carnival corporation &plc is measuring terms of volume by trips taken, nights away etc. and value is defined byexpenditure. Importance of volume
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