Finance in the hospitality industry (Doc)
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Added on 2020-11-12
Finance in the hospitality industry (Doc)
Added on 2020-11-12
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Finance in the hospitalityindustry
ContentsINTRODUCTION...........................................................................................................................4TASK 1............................................................................................................................................4P1 Identify and review of the sources of funding and service industries and implementing theBelgravia Hotels:....................................................................................................................41.2 Evaluate contribution made by range of methods of producing income within BelgraviaHotels:.....................................................................................................................................6TASK 2............................................................................................................................................62.1 Discuss the elements of cost and profit and the role of setting selling prices:.................62.2 Evaluate the methods of controlling stock and cash and discuss the cost and benefit:....7TASK 3............................................................................................................................................83.1 Explain trail balance and evaluate source and structure:..................................................83.2 Evaluate Business accounts, adjustment and notes:.........................................................93.3 Purpose and process of budgetary control in Belgravia Hotels:.......................................93.4 Analysis of budget variance:..........................................................................................10TASK 4..........................................................................................................................................104.1 Measuring of the diverse ratios of Belgravia Hotels:.....................................................104.2 Recommendation for future management strategies to enhancing performance:..........12TASK 5..........................................................................................................................................135.1 Categories cost of components:......................................................................................135.2 Measuring of contribution per units:..............................................................................135.3 Importance of BEP:........................................................................................................14CONCLUSION..............................................................................................................................14REFERENCES..............................................................................................................................15
INTRODUCTIONFinance is the tool which are used for making the business objectives in an effectivemanner. however, there is a strong need to adopt various financial tools which can be used by theorganisation for attaining the business objectives in an effective manner. This report is based onthe UK based international hospitality organisation which name is Belgravia Hotels that operatesin three parts: lodging, contract services and restaurant (Schneider and dos Santos, 2013). Andthis is looking to enhance their operations for that it need much finance so that they coulddevelop strategy effectively and make the business objectives sustainable and reliable.TASK 1P1 Identify and review of the sources of funding and service industries and implementing theBelgravia Hotels:Finance is the basic need which are required to be adopted in the business for making thebusiness sustainability. Now, this can be totally said that the management of the cited companygrab finance by way of the internal and external sources which could ultimately assist to havesustainability in an effective manner. finance is the capital which is totally incorporated in thebusiness. Capital does not only need for beginning but also for expansion of the organisation.Sources of finance available to the organisation which are internal sources of finance andexternal sources of finance, some of them are mentioned hereunder:Internal source of finance: This is the main source of finance which consider all theinner source which are the retained earnings, entrepreneur capital and others. these are the besttool for implementing in the business but in the large extent, can’t be used due to lack of thefunding. Henceforth, for small finance needs can be satiated under this. But if the large finance isrequired then the fund can be taken by using external source of finance. Internal source offinance is the basic tool that can be used by the organisation in order to gain the sustainabledevelopment.Sale of assets: this is one of the tool for raising the capital internally. Now, this can berightly said that the management by disposing of sales in an effective manner.External sources of finance: There are so many tools which are used as the externalsource of finance. Some of them are mentioned as under:3
Bank loan: This is the main common source that can be used by the organisation as theloan. This can be used as the loan or overdraft for a longer time period of time. Now, this can berightly said that this can be started as a shorter time to medium and come to an end for longertime period. The borrower is required to pay an interest rate on the loan amount which is themuch higher than the other sources. But the bank before going to take the loan, they are requiredto give the collateral security.Share capital: This is the tool which is used in order to collect the finance in an effectivemanner. via this, capital is raised by issuing share in an effective manner. now, this can be rightlysaid that the management of the cited organisation for raising the capital, gather the capital in aneffective manner so that they could effectively gather the finance. There are various kinds of theshare capital modes. Such Initial public offer, further public offer, right issues ESOP, ESPS, andothers. if the organisation is limited capital, and is looking for the raising the capital, then theshares can be issues for the public for raising the capital (Guerrier, 2013).Advantages and disadvantages of sources of finance:Advantages of Reinvest profits: Income could render a return for the investors through which investors plough back intoorganisation to assist it to develop.This does not require to have the associated costs.This does not have to be repaid unlike loans.No interest chargesDisadvantages:Profits might be limited that would be constrain rate through which organisation expands.Advantages of Sale of assets:Sold to gather cash.Incorporate sense to sold off of under used assets.Finance emerged without additional borrowings.DisadvantagesLoss assets but has to implement of the cash.External Sources:Advantages of Bank Overdraft:Sound way of boosting regular finance.4
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