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MANANGING FINANCIAL RESOURCES AND DECISION MAKING INTRODUCTION 2 TASK 13

   

Added on  2020-01-07

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MANANGING FINANCIALRESOURCES AND DECISIONMAKING

Table of ContentsINTRODUCTION ..........................................................................................................................2TASK 1............................................................................................................................................31.1 Different sources of finance available to the business..........................................................31.2 Implication of different sources of finance identified...........................................................41.3 Appropriate source for raising finance for business project.................................................52.1 Cost of each source of finance..............................................................................................52.2 Importance of financial planning to the organisation...........................................................52.3 Information needed by different decision maker..................................................................62.4 Impact of sources of finance on financial statements..........................................................73.1 Analysing the cash budget and its appropriate decisions......................................................73.2 Calculation of Unit cost........................................................................................................83.3 Viability of the project using investment appraisal techniques..........................................10TASK 2..........................................................................................................................................124.1 Main financial statements..................................................................................................124.2 Different types of statements prepared by different business organisation.......................124.3 Analysing the financial position by calculating ratio of Sainsbury....................................13CONCLUSIONS............................................................................................................................14REFERENCES..............................................................................................................................15

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INTRODUCTION Finance is the discipline of management in which various sources of funds are analysedand best of them is selected for the firm. In addition to this, it can be said that finance is the sumup of revenues and all the transaction related to money (AO'Brien and et.al., 2006). In this report,sources of finance are identified along with its implications which can be used by the company inorder to raise its capital with an aim to launch a new business project. In addition to this,importance of planning for all the financial activities in advance are also listed. Along with this,information required by the decision maker is also mentioned. Besides this, cash budget of J. Sainsbury has been analysed in order to take appropriatedecisions. In this project report, viability of the project is analysed by using investment appraisaltechniques. At last, ratio of two companies are examined in order to find which company’sfinancial position is good. TASK 11.1 Different sources of finance available to the businessThere are different types of sources of finance that can be used by the company to raiseits capital up to £300000. Some of the sources to meet long term and short term requirements areas follows:-Short term requirement of financeTrade credit: Trade credit can be defined as a simple time period when supplier extendsthe time to pay money for the raw material taken. In simple words, it can be said as an extra timelimit that can be availed by the buyer (Batt, 2002).Bank overdraft: It is the facility that is provided by the bank to its customers. Throughwhich, customers are able to draw more amount of money than what is actually deposited. This3

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