Report on Finance in Hospitality - doc
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Added on 2020-06-04
Report on Finance in Hospitality - doc
Added on 2020-06-04
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FINANCE IN HOSPITALITY
Table of ContentsINTRODUCTION...........................................................................................................................1Task 1...............................................................................................................................................11.1. Sources of funding available to business and service industries..........................................11.2. Methods of generating income and contribution to business & service operations.............2M1. Various sources of finance and their advantages and disadvantages..................................3D1. Methods of generating income and best option from it to generate income........................4TASK 2............................................................................................................................................42.1. Elements of costs, gross profit percentage and selling price for products and services......42.2. Methods of controlling cost and cash in business and service environment........................5M2 Identified and applied relevant theories and techniques of setting prices............................6D2 Take responsibility for managing and organising activities..................................................6TASK 3............................................................................................................................................63.1 Assess the source and structure of the trial balance..............................................................63.2 Evaluation of business accounts............................................................................................73.3 Purpose and process of budgetary control in a business and service environmentorganisation................................................................................................................................93.4 Analysation of budgetary variances....................................................................................10Task 4.............................................................................................................................................104.1 Ratio analysis of Belgravia Hotel.......................................................................................104.2. Appropriate future management strategies for business and service operation.................11Task 5.............................................................................................................................................115.1 Categorisation of costs of Belgravia Hotel.........................................................................115.2 Relation in Cost / Profit / Volume analysis of Belgravia Hotel..........................................115.3 Justification of short term management decisions based on CPV analysis........................13CONCLUSION..............................................................................................................................13REFERENCES..............................................................................................................................14
INTRODUCTIONHospitality sector is enclosed with hotel management, restaurants, travel and tourismfirms and so on. In order to deliver quality services to consumers it is must for theseorganisations to have enough funds and finance. These two elements can be generated throughvarious sources. Satisfaction level can be enhanced of customers through delivering products andservice according to their needs. With the help of this, profit margins can be enhanced in anappropriate manner. Both finance and accounting and its application has helped companies underhospitality section gained in an appropriate manner (Walker and Walker, 2016). Belgravia Hotelsis an international hospitality firm which is dealing in three different sector which are: Lodging,contract services and many restaurants. At the moment, they are looking forward to enhance theirprofitability and productivity at the same time. Report is going to include various things like,sources of funding and along with evaluation of different methods that aid in generating heavyincome. Away from this, elements of cost and profit that can help organisation in understandingbusiness environment. Assessment is also enclosed with trail balance, process of budgetarycontrol and so on. Many interpretations like ratios which will help in measuring performance offirm.Task 11.1. Sources of funding available to business and service industriesIt has been examined that there are ample number of sources through which both fundsand finance can be generated by organisation in an appropriate manner so that they do not faceany issues related to this while going through a task. It is required for every single firm to lookinto different aspects in order to resolve issues right on time which are being faced byorganisation that are related to funds. Belgravia Hotels already have a good name in all overUnited Kingdom, in some other countries as well and it is famous for its services they deliverproducts and services to consumers with minimal cost which is directly helping them inmaintaining long term relations with them. As per given by Legrand, Chen and Sloan, (2013),there are various funding elements that are available in business environment which providefunds whenever it is needed and these are given below:Retain Profits: One of the most relevant and easy process through which funds can beraised by organisation. Enhancing revenue and lowering expenditure can help Belgravia Hotelsto generate funds.1
Bank Loans: This is another source which is being utilised by most of firms when theyrequire funding. It is much needed for Belgravia Hotels to choose Bank which is ready to givemonitory in lower rates of interest. Heavy rate of interest will directly affect the profitability ofthis firm. Along with this, it has been analysed that Belgravia Hotels can face issues that arerelated to liquidity in near future.Bank Overdraft facility: This kind of source is for a short term of instance through whichorganisations can borrow money. But, this consist of higher rate of interest. Therefore, most offirms do not prefer this sort of resource and go for others.Credit purchases: Under this, there are many business firms who are lending funds interms of credit. It has been examined that firms like Belgravia Hotels needs to examine andmanage their working capital in which agreements that are related to suppliers so that it do notget into trouble while paying the cost in order to purchase products.As per given by Brotherton, (2012), there are some other elements as well that comesunder as an option in order to raise funds and these are: Debenture issue to capitalist,shareholders, amalgamation of two firms, mortgages and so on. Henceforth, Belgravia Hotelshave different sort of sources through which they can raise both funds and finance whenever it isneeded. It is must for company to have a good reputation so that they do not face any sort ofbarrier or issues where banks do not lend money.1.2. Methods of generating income and contribution to business & service operationsEvery single business firm whether it is of hospitality and or any other sector, it is mustfor them to generate both revenue and profit in enough amount so that to sustain at marketplacefor a longer period of time. As Belgravia Hotels comes under hospitality section therefore, theygenerates income through delivering various sort of services like providing rooms to travellers,offering them food and beverages and many more. Along side this, as given by Boella and Goss-Turner, (2013) creating benefits or earning money away with contributing in hospitalitycommercial can be evaluated through many ways and these are:Sales: Belgravia Hotels is offering various sort of services to its clients and guests likerooms, beverages, foods and other services through which they generates revenue and income.Through these only a firm can give good rivalry to its competitors. In order to enhance sales,2
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