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Finance in Hospitality industry - Assignment

   

Added on  2021-01-02

8 Pages1738 Words469 Views
Finance in Hospitalityindustry

TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................11.1 Sources of funds which are available for Paul......................................................................11.2 Methods of generating income..............................................................................................22.1 Elements of cost, gross profit percentages and selling price for services and productsoffered by restaurant...................................................................................................................32.2 Methods for controlling cash and stock in restaurants..........................................................4CONCLUSION................................................................................................................................4REFERENCES................................................................................................................................5

INTRODUCTIONThe present report is giving brief understanding about sources of funds which areavailable for restaurant and how it can generate profit with understanding concept of sellingprice, cost elements and gross margin percent. This report is purely based on task. Task 1 isgiving information about sources of funds, task 2 is giving its contribution that sale of old evenor sub letting of unused space, task 3 is giving understanding about elements and last but notleast about controlling cash and stock.TASK 11.1 Sources of funds which are available for PaulOn the basis of cited case situation, Paul a restaurant owner wants to purchase new ovenwhich in turn helps in reducing energy consumption and helps in saving cost. In this regard, thereare several internal and external sources are available which Paul can use for meeting monetaryrequirements. Issue of sharesIssue of debenturesTerm loansFund from operationsSale of fixed assetsSale of current assetsWorking capital decrementReceipt of dividend, interest and refund of taxIssue of shares: It is the most common method for raising long term capital because ofpopularity of capital market for investors and even shares are used for financing projects alongwith long gestation period (Irwin, D. and Scott, J. M., 2011).Debenture issue: It is another kind of resource that can be used by Paul runs in order tofulfil its objective.While issuing debentures in the stock exchange, there is need of payment offixed rate of interest to all debenture holders.Term loans: For financing long term projects, term loans are used because of high rate ofinterest as compared to rate of interest on debentures. Paul runs can take loan from bank and canrepay it in easy instalment. It will help the company in gaining money for expansion of buisnessunit. 1

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