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Managing Financial Resources and Decisions : Research Report

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Added on  2020-01-23

Managing Financial Resources and Decisions : Research Report

   Added on 2020-01-23

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Managing FinancialResources andDecisions
Managing Financial Resources and Decisions : Research Report_1
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................11.1................................................................................................................................................11.2................................................................................................................................................21.3................................................................................................................................................32.1................................................................................................................................................42.2................................................................................................................................................42.3................................................................................................................................................52.4................................................................................................................................................63.1................................................................................................................................................63.2................................................................................................................................................73.3................................................................................................................................................8TASK 2............................................................................................................................................94.1................................................................................................................................................94.2..............................................................................................................................................104.3..............................................................................................................................................10CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
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INDEX OF TABLESTable 1: Pros and Cons of Carious sources of finance....................................................................2Table 2: Cash budget analysis ( in £)...............................................................................................8Table 3: Sales Budget......................................................................................................................8Table 4: Calculation of Unit Cost....................................................................................................9Table 5: Net Present Value..............................................................................................................9Table 6: IRR...................................................................................................................................10Table 7: Payback Period................................................................................................................11Table 8: Ratio Analysis of Sainsburry...........................................................................................12
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INTRODUCTIONFinancial management is concerned with the concept of managing and arranging funds tocarry out the different activities of new business concern. It assist in effective allocation ofmoney to all the sectors of the company. The present research report is about a new businessentity facing issues to adapt the best and the most appropriate sources of finance to start-up theoperations (Booker, 2006). Main aim of this study is to present readers with an insight of whereand how to access sources of finance for the enterprise and also the skills needed to utilize theinformation for making various decisions. Learners will be able to identify the sources of fundsand their pros and cons. Based on this the appropriate source shall be chosen by the entrepreneurand along with that the cost of the sources of finance shall also be identified. Furthermore, in thereport, cash budget, Unit cost of product and ratio analysis of another company has also beenpresented. On this basis various decisions are made by the entrepreneur that assist in expandingits business activities (Broadbent and Cullen, 2012). TASK 11.1The first and foremost task involved in starting up a new business unit is identification ofvarious sources of finance. An organization requires finance to purchase, stock, and assets aswell as for several other activities. Therefore, enlisted below are few sources of finance whichthe entrepreneur feels that can be adapted by it:Crowd funding: In this type of finance, an owner of the company can raise funds throughvarious social networking sites such as Facebook and twitter. Hereby, the entrepreneuraims to provide best services, goods and equity to people in return for the moneygenerated through these sites. It is the best method where the owner wants to build thegoodwill of the company before starting up its business activities.Business Angels: These are the institutes which invest in new projects or businesses byproviding funds for development or either by giving contacts and skills that may bebeneficial of the entrepreneur (Bull, 2007). Australian business angels and Angels pvt Ltdare the examples of such institutes. They take risk by investing in it and also involvethemselves in the business either as a mentor or as a financier. Venture capital: It is a kind of source in which the new businesses receives various typesof knowledge regarding the operations along with the initial investment of fund. They1
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