Finance in Hospitality Industry : Assignment
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Added on 2020-07-23
Finance in Hospitality Industry : Assignment
Added on 2020-07-23
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Finance in HospitalityIndustry
Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P1.1: Sources of funding available to business and service sector.........................................1P1.2: Evaluating contribution made by range of method in generating income....................2TASK 2............................................................................................................................................2P2.1: Discussion of elements of costs and profit and role of setting selling prices...............2P2.2: Methods of controlling stock and cash..........................................................................3TASK 3............................................................................................................................................4P3.1: Process of trail balance and sources or structure..........................................................4P3.2: Evaluating of business accounts, adjustments..............................................................5P3.3: Process and objectives of budgetary control.................................................................7P3.4: Analysis of budget variance..........................................................................................8TASK 4............................................................................................................................................9P4.1: Computation of various ratios of Belgravia Hotels.......................................................9P4.2: Recommendation for future management strategies to improve performance...........11TASK 5..........................................................................................................................................11P5.1: Categories cost of components....................................................................................11P5.2: Calculation of Contribution per units..........................................................................12P5.3: Importance of BEP......................................................................................................12CONCLUSION..............................................................................................................................13REFERENCES..............................................................................................................................14
INTRODUCTIONNowadays, it has been seen that plenty of organisations are looking for an effective systemthat can help account officers to manage and control their everyday business operations. Financeis more valuable aspect for any profit generating sector. Without having sufficient amount ofcapital they cannot be able to manage its day to day business activities. In case of hospitalitysector they need to have valuable amount of finance to control accommodation facilities that areneeded by various people (Jones, Hillier and Comfort, 2016). The project report is providing more effective information about availability of resourcesthat can assist in formulating better understanding of crucial matters that are helpful indetermining overall growth and profitability of an organisation. Identification of various sourcesof funds available to hospitality sectors are discuss under this report. Certain components ofcosts and gains in setting selling prices in services sectors are explain under this project.TASK 1P1.1: Sources of funding available to business and service sectorIn every business organisation, it is necessary to have establishment of hotelier withexpansion strategies for an ongoing prosperous of business. The requirement of capital in theirmanagement operations is utmost crucial aspects that are needed to be taken into consideration.There are various sources of finance available to an any hospitality sectors. Some of them arediscuss underneath:Retained earnings: It is known as one of the primary sources of profit that a companyhas earned to date, less any dividends or other distribution which are paid to the investors. Theseprofits are further utilised in planning of expansion of the new business. Venture funding:It is a kind of private equity which is form of financing that isprovided by the firm or capital to small in their earlier phase. Investors of the Belgravia Hotelscan for this types of sources which will assist them to plan their business more effectively(Martínez, Pérez and Rodríguez del Bosque, 2013). Personal finance: It is said to be riskier and small and medium source of funding is moreeconomical through use of personal loans. Belgravia Hotels are having appropriate opportunitiesto increase profitability of an organisation.1
Government grants: Most of the time, industries are not being able to managersufficient amount of capital for their business. Thus, certain government agencies used toprovide financing such as grants and subsidies that can be available to their business. Bank loan: It is necessary to make use of short term loan for their businesses so thatavailable requirements can be meet out in more quick time. In order to provide loan bank uses tocharge certain amount as interest (Leung and Law, 2013).P1.2: Evaluating contribution made by range of method in generating incomeThere are various aspects or modes which are helpful in generating income and sufficientcontribution to hospitality industry can be examined by using various methods:Sales: It has been seen in hospitality sector which associated with provide various hotelfacilities such as allocating rooms, food and beverages and other effective services thatare useful in generating sufficient amount of capital to the company.Commission: These are mainly related with those parties those are responsible forproviding vital information about best hotel and their services from which income wouldretain from the third party. Sponsorship: It is one of the important modes from which valuable amount of capital canbe raised. This will be achieving from other companies for the promotion of their hotelnames (McManus, 2013).Grants: These kinds of incomes and supportive contribution can be collected fromgovernment side or any other legal authorities those are helpful in regulating their hotelrequirements.Sub-letting: As some of hotel units are transfer to third parties in order to increase theirmaximum gains so they need to sub letting their business operations to cover up theirlosses or to increase profitability for the company up to an extent.TASK 2P2.1: Discussion of elements of costs and profit and role of setting selling pricesThere are various cost which are determined as crucial elements of costs those areassociated with hospitality sectors. Some of them are discuss underneath:Material: These are related with those costs in the final product or services those are beingincurred to deliver a specific products and services. Some of them are Linen, Cutlery andglassware.2
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