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Project Report of Hospitality Management
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New Zealand Specialist Hospitality Training Institute
Added on 2020-04-21
Project Report of Hospitality Management
New Zealand Specialist Hospitality Training Institute
Added on 2020-04-21
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Running Head: Diploma in Hospitality management 1Project Report: Diploma in Hospitality management
Diploma in Hospitality management 2ContentsPart 1.................................................................................................................................3Book keeping................................................................................................................3Costing and pricing.......................................................................................................3Planning and budgeting................................................................................................4Investment appraisal.....................................................................................................4Ratio analysis................................................................................................................5Part B................................................................................................................................6Book keeping................................................................................................................6Costing..........................................................................................................................7Pricing...........................................................................................................................9Planning and budgeting..............................................................................................10Investment appraisal...................................................................................................11Ratio analysis..............................................................................................................12Conclusion......................................................................................................................14References.......................................................................................................................15
Diploma in Hospitality management 3Part 1:a)Book keeping:Book keeping is a process which contains the recording, retrieving and storing the activities and the financial transactions of an organization, individual or nonprofit organization. It is the part of accounting in an organization. The transaction includes the sales, purchase, payments and receipts by an organization or an individual. Book keeping process is usually performed by the book keeper of the company (Marinovic, 2013). This process keeps a track over all the financial and accounting transaction of a company to recordthem into the books. There are many methods of book keeping available but the main method of book keeping is the double entry book keeping system and single entry book keeping system. Double entry book keeping system depict that every financial transaction affect 2 or more than 2 accounts collectively and thus the impact of the transaction must be shown over both the accounts rather than one (Hahn & Kuhn, 2012). This double entry book keeping system makes it easy for the managers and hospitality industry to manage all the activities and financial transaction of the company as well as it depict that the accountant must do adjustingentries to manage all the extra transaction which has been done into the profit and loss account and manages into the balance sheet (Larcker, Richardson & Tuna, 2007). b)Costing and pricing:Costing and pricing is a tool of managing the selling price of a company. Costing is the total amount which has been occurred while manufacturing a product or providing a service to the customers. Under the approach of the costing, direct material, direct labor, overhead cost etc are examined and the total of all of these is the cost (Ewert & Wagenhofer, 2005). Whereas when the total cost and the profit of the company is added than the total amount is the pricing which is charged by the company against the products and services of the company. The main method of costing and pricing is ABC costing method and traditional costing method. ABC costing method allocates the cost according to their different basics whereas traditional costing method allocates the cost according to single basics (Biddle & Hilary, 2006). For instance, Tom has offered some services to the guest and total cost of theseservices were $ 15 and the profit of tom is 20% of the cost than the total pricing of the
Diploma in Hospitality management 4services would be $ 18 ($ 15+ 10% of $ 15). The cost and pricing method is important for hospitality industry to analyze and investigate the total pricing which must be charged to the clients to achieve the target profit level (Bartov, & Mohanram, 2004). c)Planning and budgeting:Planning and budgeting are co related to each other. This a three step process in which the information are collected and determined according to the short term goals and long term goals of the organization. This procedure is mainly administered by financial department of the organization. The most used tool for budgeting is cross cutting method. In this method, allthe relevant and associated cost are examined according to the future projection, current market condition, historical data, variances, changes into the economic position etc. And on the basis of that the budget planning is done. For instance, a company is trying to make the budgeting for its new financial year andfor that, the company must look over various factors so that a proper budgeting could be done(Kieso, Weygandt & Warfield, 2010). The company must look over future projection and changes of the company, current market condition and competitor position, historical data and budget of the company, variances analysis and changes into the economic position of the country. This would help the company to manage and administer the financial position of the company as well as the planning of the future revenues, profits, production, engaged rooms etc. d)Investment appraisal:Investment appraisal is a process which is used to analyze and determine the organizations long term investment like replacement of equipment of the company, machineries, set up new locations, invent new technologies, new products, and research project and research development. This is the procedure of allocating the resources of the company into various parts. Mainly, net present value and internal rate of return technique is used for analyzing the investment appraisal of a company. These techniques help the company to manage and administer the process and investment of the company (Juan García-Teruel & Martinez-Solano, 2007). Net present value is the technique which analyzes the total profit of the company in current time. This process considers the time value of money and analyzes the total profit which could be got by the company through investing into a particular project of the
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