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Managing Financial Resources and Decisions - Report

   

Added on  2020-01-06

17 Pages5094 Words110 Views
Managing Financial Resourcesand Decisions
Managing Financial Resources and Decisions - Report_1
TABLE OF CONTENTSINTRODUCTION................................................................................................................................1TASK 1.................................................................................................................................................11.1 Identify sources of finance.........................................................................................................11.2 Assess the implication of different sources................................................................................11.3 Evaluate the sources of finance.................................................................................................22.1 Analyse the cost of different sources of finance........................................................................32.2 Explain the importance of financial planning............................................................................32.3 Assess the information needs of decision makers......................................................................42.4 Explain the impact of finance on financial statements..............................................................53.1 Prepare cash budget and make pricing decisions.......................................................................53.2 Calculation of unit cost and pricing...........................................................................................73.3 Assessing the viability of project...............................................................................................8Task 2..................................................................................................................................................104.1 Discuss the main financial statements.....................................................................................104.2 Compare different formats of financial statements..................................................................114.3 Interpretation of ratios..............................................................................................................11CONCLUSION .................................................................................................................................12REFERENCES...................................................................................................................................14
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INDEX OF TABLESTable 1: Calculation of Unit cost..........................................................................................................5Table 2: Calculation of selling price.....................................................................................................6Table 3: Calculating cash flow of project.............................................................................................6Table 4: Calculation of Pay back period..............................................................................................7Table 5: Calculation of ARR................................................................................................................8Table 6: Calculation of NPV................................................................................................................8Table 7: Ratio analysis of Marriott international................................................................................10
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INTRODUCTIONManaging financial resources and taking creative and efficient decisions are integral part ofthe management. This will entails about the new start-up business opening by an entrepreneur on asmall scale. This project report give emphasizes on the unique sources of finance available for tradeperson and defines their implications on their raw business. The innovative combination of thesources is effective through financial planning of resources. The institution uses forecasting toolsand capital budgeting techniques to assess the viability of the project. This enhanced viability of theproject will forms a basis for selecting a right project which generates higher returns.TASK 11.1 Identify sources of financeVenture capital- Venture capital is a source of finance where capital is provided to Newbusiness or business with high growth. The capital is provided by the high net worthindividual or public financial institution. Generally in this type of source of finance theinvestment is carried on by venture capitalist firms. Venture capitalist firms are those firmswhich specialise in creating portfolios consist of highly risky assests. It is a essential sourceof capital to those companies which have high growth potential but they do not have reachto capital markets. This source of finance is considered risky for the investors but there isalso a chance of huge pay-off. Angels- Angel investment is the earliest stage of equity finance where the investment ismade by the wealthy individual or group of wealthy individual. These investors can beformer executives or former business-owners who have prior experience related to that field.These angel investors provide capital against the equity and the experience they are going toshare with the start up. It is considered as very risky form of financing because angleinvestment are generally made in the early stage start up.Financing from banking institution- This is a medium/long term source of finance wereentity borrows money from the bank and agrees to repay that money over equal intervalsduring a course of time including interest. They enjoy the preferential right over any othersource of finance. Generally, loan is provided by the bank against any asset mortgaged bythe entity.1
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