Planning to Expand Business Operations Clariton Antique Ltd | Assignment

Added on -2020-02-17

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Table of ContentsINTRODUCTION......................................................................................................................3TASK 1......................................................................................................................................31.1 Sources of finance available to Clariton Ltd....................................................................31.2 Evaluating the implications of different sources of finance.............................................41.3 Identifying the suitable financial source of business.......................................................5TASK 2......................................................................................................................................62.1 Analyse the cost of two source of finance with their tax implications............................62.2 Importance of financial planning for Clariton Antiques..................................................72.3 Assessing the information need of different decision makers.........................................72.4 Impact of financial source on final accounts....................................................................7TASK 3......................................................................................................................................83.1 Preparing and analyzing cash budget for the purpose of decision making......................83.2 Calculating unit cost for taking pricing decision.............................................................93.3 Evaluating the viability of proposed investments..........................................................10TASK 4....................................................................................................................................124.1 Discussing the components of financial statements.......................................................124.2 Comparison of the formats used by Clariton Antiques to present their financialstatements.............................................................................................................................134.3 Interpreting the financial statements of Clariton using ratios of current and previousyear.......................................................................................................................................13CONCLUSION........................................................................................................................15REFERENCES.........................................................................................................................16
INTRODUCTIONManagement of financial resources is the main tasks or activity of the firm which layshigh level of emphasis on the assessment of deviations. By using monetary tools businessentity can identify the causes of deviations and thereby becomes able to develop highlycompetent framework. This assignment is based Clariton Antique Ltd which is planning toexpand business operations and functions with the motive to widen the research. Forexpansion purpose, business entities require fund for the establishment of another unit. Inthis, report will describe the financial sources that can be undertaken by the owner to raisefunds. In addition to this, the main focus on such study is to highlight the manner in whichmonetary tools and technique facilitate better and effective decision making. TASK 1 1.1 Sources of finance available to Clariton Ltd Unincorporated business Personal savings: By using own savings sole trader can start venture more effectivelyand efficiently. In this, business entity is not entitled to pay any kind of interest toothers which in turn may result into high savings. Sales of fixed assets: Business entity of Clariton Ltd can enhance fund by sellingunused assets such as land, plant etc at their scrap value. Short term lease: It is the most suitable source that can be undertaken by anentrepreneur for fulfilling financial needs. On the basis of this aspect, by taking assetslike machinery, land & buildings, furniture’s and fixtures on lease entrepreneur canimplement the business idea within the suitable time frame. Incorporated business Clariton Ltd comes under the category of incorporated business that can raise fundsby considering following sources:Bank loan: Entrepreneur can meet financial requirements by approaching to financialinstitution. Interest is the major sources of income for banking institutions (Bergbrant,

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