Financial Management Practices and Applications
Added on 2020-01-28
20 Pages5145 Words66 Views
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Table of ContentsINTRODUCTION......................................................................................................................3TASK 1......................................................................................................................................31.1 Sources of finance available to incorporated and unincorporated business.....................31.2 Defining the impact of financial sources on business organization.................................41.3 Evaluating the suitable source of finance.........................................................................6TASK 2......................................................................................................................................72.1Assessing the cost of varied sources of finance................................................................72.2 Explaining the importance of financial planning to Clariton Ltd....................................72.3 Assessing the information needed for different stakeholders..........................................82.4 Evaluating the impact of sources on financial statements...............................................9TASK 3....................................................................................................................................103.1 Cash budget and making appropriate decision on the basis of deficit or surplus position..............................................................................................................................................103.2 Unit cost and pricing decisions......................................................................................113.3 Finding best investment proposal by using investment appraisal techniques................12TASK 4....................................................................................................................................144.1 Presenting the key components of financial statements.................................................144.2 Differentiating the financial statements of sole traders from partnership firm..............164.3 Assessing key information from final accounts by using ratio analysis technique........17CONCUSION..........................................................................................................................19REFERENCES.........................................................................................................................21
INTRODUCTIONIn the business organization, top management has accountability to develop soundframework that makes contribution in the attainment of organizational goals. Moreover, forgetting success in the highly competitive business environment company is required to makeproper use of money. In this context, manager is required to take decision by assessingmarket trend and customer expectation. Further, managers also use financial techniques formaking decision in relation to the procurement, allocation and control. In this way, team ofhigher management plays a vital role in ensuring optimum use of resources. Clariton Ltd hasbeen selected as an organization which offers antique products to UK customers. In thiscontext report will describe the tools and techniques that assist Clariton Ltd in makingsuitable business decisions. Besides this, report will also provide deeper insight about thefinancial health and performance of Clariton Ltd. TASK 11.1 Sources of finance available to incorporated and unincorporated businessUnincorporated business Sources of financeDescriptionSales of assets Each business organization has some assetswhich are not used by it in productiveactivities. In this regard, by selling suchunprofitable assets sole traders andpartnership firm can generate fund. Short term lease By taking fixed assets such as plant, land etcon lease company can meet its monetaryrequirements to a great extent (Gibbert,Hoegl and Valikangas, 2014).Incorporated business Sources of financeDescriptionVenture capitalists It is the type of private or equity financingwhich offers financial assistance to thebusiness organization for their long termgrowth or potential. For instance: WeFinance Ltd is the venture capitalists whichoffer start-up capital to the business
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