The Internal Business Proceeding of the Enterprise | Report
The aim of this unit is to help learners acquire knowledge, skills and techniques that will assist with management decision-making processes in the travel and tourism sector.
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Added on 2020-02-05
The Internal Business Proceeding of the Enterprise | Report
The aim of this unit is to help learners acquire knowledge, skills and techniques that will assist with management decision-making processes in the travel and tourism sector.
Added on 2020-02-05
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FINANCE AND FUNDINGIN TRAVEL AND TOURISM
Table of ContentsINTRODUCTION...........................................................................................................................................3TASK 1..........................................................................................................................................................31.1Importance of costs and volume in financial management of travel and tourism business...............31.2 Pricing methods used in travel sector................................................................................................51.3 Factors influencing profit for travel and tourism business.................................................................6TASK 2..........................................................................................................................................................72.1 Different types of management information tools............................................................................72.2 Assess the use of management information in decision-making.......................................................8TASK 3..........................................................................................................................................................93.1 Interpret travel and tourism financial accounts.................................................................................9TASK 4........................................................................................................................................................124.1 Enclosed in poster............................................................................................................................12CONCLUSION.............................................................................................................................................12REFERENCES..............................................................................................................................................14
INTRODUCTIONFinance is life line of every business enterprise as without which the existence of business is notpossible. Funding is that feature which involves in the business in which financial resources areutilized by an enterprise that assists the entity in cost reduction. The efficiency of the business ishigher with the existence of stockholders and financiers who will give recognition to an entity byuplifting their existing status. Merlin entertainment is that enterprise whose significance has beenshowcase with the help of this report. The following report will give emphasis on the internalbusiness proceedings of this enterprise as it is related to travel and tourism operations. Thisproject report is all about describing various needs of the current organizations in order to collectvarious kinds of financial resources as per their current business requirement. This report stresseson different forms of investment taken up by an enterprise. The major objective of this report isto analyse various skills, tools, knowledge that has been emerged with the help of differentmanagement decision making tools in travel and tourism industry. It also involves variouspricing methods that can be used by the business throughout the report.TASK 11.1Importance of costs and volume in financial management of travel and tourism businessBusiness is a combination of income and expenses which are incurred in daily routine businessas the owner needs to control their expenses in order to increase the amount of the sales and therevenues (Ward and Peppard, 2016). Different expenses involved in the business enterprise suchas operating expenses includes material expenses, use of equipments, wages and salaries anddifferent other expenses which may be fall in the business at particular time interval. There aredifferent kinds of costs involved in an enterprise which needs to be maintained by preparingbudgets and using different monitoring tools and techniques (Stewart, 2014). The costs can be oftwo major categories that is fixed costs and variable costs. The fixed costs is that kind of costswhich will be not be reduces as it is jointly connected with the opening of business such as rentof the premises and utility bills. On the other hand variable costs are that costs which may vary according to the changes in theproduction level of the business. The nil production unit may doesn’t produce any variable costs
as it is increases or decreases with the changes takes place in the activity level of production ofan entity. Various costs involved in the business of Merlin Entertainment include preliminarycosts involved in arranging funds and financial resources from the external business environment(Mulley and Walters, 2014). It also involves various costs such as expenses involved forproviding fun and leisure activities for visitors who visits different tourists destinations, ticketbooking services by opening travel centres to facilitate all its customers, bookingaccommodation facility which requires costs as the owner will collaborate with different hotelsin order to provide this kind of feature to all their customers who books tickers for variousdestinations.The costs should be reviewed and revised periodically in order to attract wide number ofcustomers as the higher prices will de-motivated various customers and hence reduces the levelof sales and the revenue (Kaplan and Atkinson, 2015). Another perspective involve in revisionof costs is that all the changes are taken into considerations in the price of tickets which includesincreasing fares of flights, increase in the cost of visa services, higher taxation burden such asservice tax, excise duty and value added tax. It helps an enterprise in determining the financialposition by identifying the actual proportion among the income and expense ratio. This ratioassists an entity in order to increase their overall profitability by collecting income from severalkinds of sources.This enterprise will also use various techniques that are cost volume profit analysis techniquewhich is concerned with an entity in order to firm relationship between cost and sales of the firm.The importance of CVP analysis which is beneficial for an entity for operating in this fastgrowing and emerged industry that is travel and tourism sector which are given as below:It helps Merlin enterprise in assessing their costs as the burden of fixed costs on the business willsuppress the existing business conditions (WisCombe, 2016). CVP used to forecast the futuresales and specific percentage of sales and also identify that amount of sales level at which theentity will not earn profit nor loss just top cover their basic costs involved in the business entity.It helps to provide different sales mix which facilities variety of customers as wide variety ofproducts or services. It also used to carry out analysis in which variety of activities are conductedby Merlin entertainment PLC, such as recruitment of new staff, buying or selling of existingassets, leasing new machines in order to reduce costs to a greater extent.
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