Hospitality Industry Solved Assignment (Doc)

HBT

Table of Contents
INTRODUCTION.....................................................................................................................................3
TASK 1.......................................................................................................................................................3
Introduction of financial statement and identification of types of source documents and recording
processes.....................................................................................................................................................3
Principles of double entry system by using an example...........................................................................4
Need of an accounting report and Purpose of Trial balance.....................................................................5
Type of costs and importance of accurate recording of transactions with the help of accounting
principles.................................................................................................................................................7
Role of financial management.................................................................................................................7
TASK 2.......................................................................................................................................................8
Issues in talent acquisition and retention with in the food & beverage sector..........................................8
Legislations complied by hospitality organization...................................................................................9
Performance management plan for a specific job role.............................................................................9
Recommendation on improvement of company’s HR life cycle..............................................................9
TASK 3(PPT)............................................................................................................................................10
CONCLUSION........................................................................................................................................10
REFERENCES..........................................................................................................................................11

INTRODUCTION
Hospitality industry offers wide range facilities to its customers which includes
accommodation, foods & beverages, cruise lines and event management. This report gives an
introduction of financial transaction and type of source documents. Further, this report explains
principles of double entry system, need of accounting report and purpose of trial balance.
Moreover, this report includes different types of cost and importance of recording accurate
transaction. Further, this report elaborates role of financial management in Eat-studio.
Furthermore, this report explains issues related to talent acquisition & retention. Furthermore,
this report elaborate legislation applied on foods & beverages industry. Moreover, this report
explains various stages of HR lifecycle & importance in a specific job role of hospitality sector.
After this, the report develop a performance management plan. At last, the report gives
recommendation for improving stages of HR life cycle.
TASK 1
Introduction of financial statement and identification of types of source documents and
recording processes
Eat-studio is a restaurant & hotel newly established at Bishops gate in London which
offers variety of salads & juices and the main aim of this cafe is to provide hygienic & healthy
food to its customer’s and it also offers affordable accommodation.
Financial Statement- Financial statement of any organization is a combination of Balance sheet,
Cash flow statement and Income statement. Every organization prepare financial statement to
know inflow and outflow of cash in the business, ability of business of paying liabilities out of its
assets and for what purpose the cash is being used. Company make financial statement to check
that the start up is profitable or not and what will be the future position of the business. If
financial statement of Eat-studio is strong than it also shows ability of the company in taking
loans from the bank. Eat-studio make balance sheet and income statement each year to know the
position of its business. Company follow general accounting principles to record its transactions
& for the preparation financial statement. For recording of transactions of the company and for
making balance sheet and income statement company need various source documents such as
bank statement, sales order, supplier invoice, vouchers and cash register. Source documents are
physical proof based on which accountant of Eat-studio record the transactions and prepare

financial statement. Eat-studio follow Double Entry book keeping system to record all its
transitions(Barr and McClellan, 2018).
Principles of double entry system by using an example
Principles of Double Entry Bookkeeping System- According to the principle of double entry
bookkeeping system each transaction is recorded at two side which is debit & credit. Every
transaction done by Eat-studio has an equal impact on both the side (Debit & Credit) and this
concept is known as Dual aspect Concept. Eat-studio uses this system because it helps the
company in finding its cost & profits and balance sheet of the company is also prepared on its
basis. Every transaction is debited & credited according to the nature of transaction. Rules of
Debit & Credit are discussed below-
 Personal Accounts- All the transactions done with individuals such as creditors and
debtors by the company is related to this account. According to this rule of Book-keeping
accountant of Eat-studio make a debit of all the person’s accounts who are receiving
something and make a credit entry of all the person’s account who are providing goods &
services(Cascio, 2015).
Rule- Debit the Receiver
Credit the Giver.
 Real Accounts- Real account is related to the assets if any assets is purchased by the
owner of Eat-studio for the business purpose than the accountant of the restaurant record
it on the debit side. On the other hand, if company sells any of its assets than that
transaction is recorded on the credit side of the books of accounts of the company.
Rule- Debit what comes
Credit what goes out.
 Nominal Accounts- As per this principle of Book-keeping if company make any
expenses for running its operations and if company insures any losses than accountant of
Eat-studio will record all the expenses & losses at the debit side. Whereas, any income

&profits is generated by the company than they all are transferred in the credit side of the
books of accounts of the company.
Rule- Debit all Expenses & Losses
Credit all Incomes & Gains.
Following transactions are done by Eat-studio at last month-
1. Raw material purchased from Jacob on credit for 500 dollars.
In this transaction two accounts are involved purchase account & Jacob’s
Account. According to this principal accountant of Eat-studio credit the account
of Jacob because he is giver. While Purchases is an expense for the company
which comes under nominal account and according to the rule of nominal account
same will be debited(Dzhandzhugazova and Romanova, 2016).
2. Cash paid to Kristian & co. of 300 dollars.
In this transaction cash is a current asset and which is going out of the business
and it is the part of real account whereas Kristian & co. is a receiver and a part of
personal account. Thus, Kristian & co. account will be debited, and cash account
is credited.
Need of an accounting report and Purpose of Trial balance
Need for an accounting report- Eat-studio is a small & new business so it of its business and to
know the earnings. Eat-studio makes its accounting reports for finding expenses, asset and
liabilities of the company. Preparation of accounting reports are needed by the company to check
its capabilities to earn profits and grow in the food & beverages market. is necessary for the
company to know the importance of Accounting Reports. Company has to maintain its reports
for calculation of amount of taxes. Profit & Loss Account, Balance sheet, Account receivable &
payable account are the part of accounting reports and company prepare these reports to know
the position
Trial Balance-

Trial Balance
Eat-studio
as at 31st December 2018
Particular’s Debit Credit
Cash at Bank 500
Stock 300
Furniture 200
Sales 400
Purchases 500
Account Payable 200
Bank Loan 600
Owner’s Capital 300
Total 1500 1500
Accountant of Eat-studio 1st prepare ledgers of all the accounts by using journal entries and after
that closing balances of ledgers are transferred to the trial balance and if both the sides of trial
balance are matched than it proved that all the entries are recorded properly.
Purpose of Trial Balance- Eat-studio prepares Trial balance to ensure that all the transactions
are debited or credited accurately or not. Purpose of making trial balance is to check that all the
ledgers of the company is equal or not because trial balance states closing balance of all the
ledgers of the company. For Example- If accountant of Eat-studio made a debit entry instead of
credit than company can check it by making trial balance. Trial balance is also made by the
company for audit purpose because auditor check the trial balance for checking adequacy of
recoding of transaction and it makes easy for the auditor to check all the transactions(Lopes,
2016).

Type of costs and importance of accurate recording of transactions with the help of accounting
principles
Types of Cost- Expenditure incurred by Eat-studio for operating its business is known as cost.
Cost are necessary for running any business. Each & every business make an estimate about the
amount of cost incurred by it. Various types of cost are discussed below-
 Fixed & Variable Cost- Fixed cost are a cost which doe not change which the change in
output. For example- if Eat-studio produce 100 units with the cost of 500 dollars than
company can also produce 500 units in 500 dollars. On the other hand, variable cost
changes with the change in output and quantity. Variable cost is a cost which is also
changes according to the change in sale volume of products of Eat-studio. Laboure cost,
Material cost are the type of variable cost(Kandampully, Zhang and Bilgihan, 2015).
 Direct & Indirect Cost- Direct cost are the type of cost which is incurred according to
the level of output and price of raw material. Direct cost is also a type of variable cost.
On the other hand, indirect cost is a type of fixed cost which is not used in the production
of goods and services of Eat-studio but indirectly connected to the production such as
salary & wages for the staff, rent and electricity.
Importance of Recording of Transactions- If accountant of Eat-studio manages & its
transactions accurately than it helps the company in maintaining taxes and working cost. If any
transaction is not recorded according to the principles of accounting than that shows a wrong
financial position of the company. Accuracy of recording of transactions helps Eat-studio by
finding hidden cost, performance of business, growth opportunity and profits of the company. If
transactions are recorded properly than it also helps the company in finding any issues such as
where company is lacking behind and how it can improve its financial position. If company does
not follow all the principles of accounting for recording than their can be violation dual aspect
concept and the same will reflect in the financial statement of the company. So, it is important
for the company to record its transactions appropriately.
Role of financial management
Managing financials of a company is very important because it show profitability and
growth of the company. Financial management plays a vital role in any organization. According
to the views of (Noe, Hollenbeck and Wright, 2017) role of financial manager includes

Accounting & Book-keeping which helps Eat-studio in recording all the financial details of the
company and it also delivers overall financial situation of the company. Further, role of financial
manager is also making report of financial position of the company. Role of financial
management facilitate management of all the receivable & payables and cash inflows & outflows
of the company. It is monitored that financial management helps Eat-studio in minimizing
uncertain risk and liabilities. Financial management also helps the company by providing various
ways of investment which help the company in achieving more profits and expand its business. I
recommend the company to record all its transaction daily and company must use a software for
recording transaction and for preparing financial statement. Because, it gives transparency and it
is also easy for the company to maintain records(Cascio, 2015).
TASK 2
Issues in talent acquisition and retention with in the food & beverage sector
Every organization needs efficient staff to improve productivity & profitability of the
company and it is not so easy for each sector to retain talented staff. Food &Beverages sector
also faces various problems in acquiring talented work-force, such as-
 Innovation & Industry Trends- This is the biggest issue for the foods & beverage
sector because, employees of this sector must change their performance with the change
in trends but most of the employees are not ready to make changes in their offerings.
Thus, companies in this sector such as Eat-studio faces problem of retaining talented
employees and it is hard for the restaurants to recruit talented people with the change in
trends. This also an issue of this sector to invest large amount on training &
development(Sangster, 2015).
 Entrepreneurial Exploration- Many young & talented people wants to establish their
own startup which reduces number of talented employees with in this sector. For
Example, many youngsters are opening their own food truck. Thus, it is also a biggest
problem faced by food & beverage industry.
 Lack of skills- Most of the talented employees does not aware about the use of
technology and technology plays a vital role in the growth of food & beverage industry.
Thus, lack of skills is also a biggest issue for retaining talent employees in Eat-studio or
Foods & beverages industry.

Legislations complied by hospitality organization
Food & Safety Act, 1990- It is an act applied on all the hospitality businesses operated in United
Kingdom. According to the rules & regulations of this act Eat-studio has to follow all the requirement of
food safety such as quality, hygiene and company should give all the detailed information about contains
of the product. Provisions of this act affects employment contract & decision making of the company.
Eat-studio must keep in mind all the rule of this act while making decisions such as Authorized technique,
quality of product & Advertisement. If company makes any decision by violating rules of this act than
company has to pay consequences. This also affects employment contact because if Eat-studio does not
provide products according to the specification and quality product than license of the company can be
cancelled(Sangster, 2015).
Stages if HR life cycle & importance of HR
Stages of HR life Cycle- Human resource managers develop various stages which is followed by
employees and performed by the HR of Eat-studio. These stages are discussed below-
 Recruitment- Recruitment is the 1st and most important stage which helps Eat-studio in
hiring talented & qualified staff. For recruiting talented workforce HR managers of Eat-
studio create a recruitment plan which helps in identifying vacancies & requirements of
employees, make strategies to hire talented employees and make a systematic process of
interview.
 Education- After recruitment HR managers of Eat-studio gives training to its employees
for letting them know their roles & responsibility at the work place.
 Motivation- Motivation is a technique which helps Eat-studio in enhancing its market
share and profits. HR manager of restaurant motivates its employees by giving them
compensation, perks and bonus.
 Evaluation- HR manager of Eat-studio monitors the performance of its employees and
improve their performance by giving instructions & feedbacks.
 Celebration- At this stage HR manager of Eat-studio organize an event to recognize
performance & hard work of its staff.
HR manager of Eat-studio plays an important role in supporting, growing & retaining talented
Performance management plan for a specific job role
Recommendation on improvement of company’s HR life cycle
It is recommended to HR mangers of Eat-studio to improve process of HR life cycle. HR
managers of restaurant should develop a strategic recruitment plan which minimizes cost of
recruitment. Further, HR manager of the hotel should train new employees about the use new
technologies and motivate them to learn new skills so that they can work in a flexible work
environment. Company should also collect feedbacks from its employees time to time and
provide them a satisfactory work place(Zietlow, Hankin and O'Brien, 2018).

TASK 3(PPT)
CONCLUSION
This report outlined meaning of financial statement & types of various source documents.
Further, this report summarizes principles of double entry system. Furthermore, this report
outlined need of accounting report & purpose of trial balance. Moreover, this report concluded
various types of cost and role of financial management. Further, this report outlined issues in
talent retention in foods & beverage industry. Furthermore, this report outlined legislation
applied on hospitality sector. Moreover, this report concluded stages of HR life cycle and their
importance in specific job role. Further, this report outlined a performance management plan. At
last the report concluded with a recommendation for improving stages of HR life cycle.

REFERENCES
Books & Journal
Barr, M.J. and McClellan, G.S., 2018. Budgets and financial management in higher education.
John Wiley & Sons.
Zietlow, J., Hankin, J.A. and O'Brien, T., 2018. Financial management for nonprofit
organizations: policies and practices. John Wiley & Sons.
Sangster, A., 2015. The genesis of double entry bookkeeping. The Accounting Review. 91(1).
pp.299-315.
Cascio, W.F., 2015. Managing human resources. McGraw-Hill.
Noe, R.A., Hollenbeck, J.R. and Wright, P.M., 2017. Human resource management: Gaining a
competitive advantage. New York, NY: McGraw-Hill Education.
Kandampully, J., Zhang, T. and Bilgihan, A., 2015. Customer loyalty: a review and future
directions with a special focus on the hospitality industry. International Journal of
Contemporary Hospitality Management. 27(3). pp.379-414.
Lopes, M., 2016. The hospitality industry (Doctoral dissertation).
Dzhandzhugazova, E.A. and Romanova, M.M., 2016. Innovations in hospitality
industry. International Journal of Environmental and Science Education. 11(17). pp.10387-
10400.
Feinstein, A.H., Hertzman, J.L. and Stefanelli, J.M., 2017. Purchasing: Selection and
procurement for the hospitality industry. Wiley.
Butler, S.A. and Ghosh, D., 2015. Individual differences in managerial accounting judgments
and decision making. The British Accounting Review. 47(1). pp.33-45.