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Finance and Funding in Travel and Tourism TABLE OF CONTENTS INTRODUCTION

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Added on  2020-06-03

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Finance and Funding in Travel and Tourism TABLE OF CONTENTS INTRODUCTION 1 TASK 11 P1.1 cost and volume importance in financial management 1 P1.2 Various pricing methods used in Travel and tourism 1 TASK 22 P2.1 management accounting information its types and uses 2 P2.2 Management accounting information in Decision making 5 TASK 36 P3.1 financial performance of The Restaurant Group 6 TASK 47 P4.1 sources of fund for capital project 7 CONCLUSION 8 REFERENCES 9 INTRODUCTION Travel and tourism is very

Finance and Funding in Travel and Tourism TABLE OF CONTENTS INTRODUCTION

   Added on 2020-06-03

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Finance and Funding inTravel and Tourism
Finance and Funding in Travel and Tourism TABLE OF CONTENTS INTRODUCTION_1
TABLE OF CONTENTSINTRODUCTION................................................................................................................................1TASK 1.................................................................................................................................................1P1.1 cost and volume importance in financial management.......................................................1P1.2 Various pricing methods used in Travel and tourism.........................................................1TASK 2.................................................................................................................................................2P2.1 management accounting information its types and uses.....................................................2P2.2 Management accounting information in Decision making.................................................5TASK 3.................................................................................................................................................6P3.1 financial performance of The Restaurant Group................................................................6TASK 4.................................................................................................................................................7P4.1 sources of fund for capital project......................................................................................7CONCLUSION....................................................................................................................................8REFERENCES.....................................................................................................................................9
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INTRODUCTIONTravel and tourism is very huge industry like other industries. It has its various functionsand activities for which they require funds. To operate any business funds are most importantpart. Therefore like any other industry, travel and tourism industry also requires fund. Thepresent report is based on funds requirement of Merlin entertainment ltd. The company is anentertainment service providing company that is located in 23 countries with 115 attractions. Themain three segments of the company are Midway attractions, LEGOLANDS parks and resort andtheme parks. In this report the importance of management accounting information has beendiscussed in regarding with travel and tourism industry Taking Merlin as an example. The reportalso provides the information about various sources from where company can raise funds for itscapital projects. That is enclosed in ppt and poster. Analysis of Financial performance has alsobeen conducted with the help of Ratio analysis for the given financial data of The Restaurantgroup Plc.TASK 1P1.1 cost and volume importance in financial managementEvery company from any industry have some costs and volume of its products andservices. Changes in cost and volume of products and services affects the company's operatingincomes and operating expenses (Rani, Yadav and Jain, 2015). For making short term and longterm decision making, costs and volume factors play an important role. This establishes differentrelationships like, cost of producing goods and amount of goods sold and profit from selling ofgoods. Components of costs and volumes helps the management in giving the insight aboutprofitability of the goods and services of the company. For Merlin entertainment costs relate tothe expenses that are involved in producing and selling its services and volume refers to thenumber and amount of services provided.Various costs can be classified intoDirect cost: Those costs that are directly related to the services or products of the company areclassified as direct costs. In case of Merlin Entertainment, those workers that operatesdifferent rides, working staff, payment of wages to such kind of staff can be considered as
Finance and Funding in Travel and Tourism TABLE OF CONTENTS INTRODUCTION_3
direct cost. Another example of direct cost in case of Merlin entertainment could be onlythat proportion of electricity bill which is associated with the operation of rides.Indirect cost: indirect cost refers to the cost that cannot be attributable directly to a batch orgroup of products and services. These costs relates to the overall activities of an organisationand cannot be classified to a single activity or batch of activity. In case of Merlinentertainment, indirect cost could be advertisement expenses, cost of electricity, salary to theadministration staff, and other costs of operations that benefits the company as a whole.Variable costs: variable cost is a part of direct cost. This includes costs that changes with changein number or services or the units of products produced. Variable costs remain same on perunit basis and varies with the total number of amount. Example of variable costs for Merlinentertainment would be printing cost of entry tickets, direct material for providing betterservices to the customers, etc. These costs of Merlin entertainment will change with thechange in number of customers to the Merlin entertainment ltd.Fixed costs: Those costs of the organisation that remain fixed and does not have an affect ofnumber of production or services are known as fixed costs. However, the overall proportionof fixed cost increases when the number of units of services are low and the proportiondecreases when the number of services or the amount of production is high (Ward, andForker, 2017). For Merlin entertainment fixed cost could be the salary to the administrationemployees, rent of building or rent of land if any, etc.Volume:Economies of scale: That point where an increase in a single unit of output provides anadvantage in cost. The affect of economies of scale arises due to the relationship betweencost of overall services and per unit fixed cost. More will be the services, less will be the perunit fixed cost because fixed cost will be spread out over the number of services. Forexample, if the company is operating in rental building, and it expands its one of the activity,the per unit fixed cost of rent of building will decrease, this will be the situation ofeconomies of scale for Merlin. Economies of scale can be caused due to both factors,internal as well as external factors. Internal factors could be reduce in per unit fixed cost due
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