Hops Listed Pty Ltd: Finance and Budgeting Assignment Analysis

This assignment provides a comprehensive solution to a finance-related problem, covering cash flow statements, budgeting, and variance analysis. The solution begins with a detailed cash flow statement for Hops Listed Pty Ltd, outlining cash inflows and outflows, and calculating net cash flow from operations, investing activities, and financing activities, culminating in the cash at the end of the year. The assignment then moves into budget analysis, comparing existing and forecasted figures for various financial metrics. It includes calculations for rooms division, occupancy rates, revenue per available room, cost of goods sold, and staff costs. The budget analysis incorporates percentages to understand margins and variances, providing insights into financial performance. The document also references sources used for the financial concepts and calculations.

Running head: MANAGING FINANCES 1
MANAGING FINANCES

Running head: MANAGING FINANCES

Running head: MANAGING FINANCES
Cash Flow statement
The cash flow statement is the statement that defines the cash inflows as well as the cash
outflows of the given company over the period of the time. The cash inflows define the
movement of the cash inside the organization whereas the cash outflows are related with the
expenses of the organization. The major purpose for the preparation of the cash flow
statement is to keep a supervision of the cash and the relevant items. In the present scenario
the cash at the end of the year tends to be $25200 (Chen, 2017).
Hops Listed Pty Ltd
Cash Flow Statement
For the Year Ending 30/06/15
Cash at Beginning of Year 22,900
22,900
Operations
Cash receipts from customers 6,93,200
Cash paid for
Inventory purchases -2,64,000
General operating and administrative expenses -1,12,000
Wage expenses -1,23,000
Interest -13,500
Income taxes -32,800
Net Cash Flow from Operations 1,47,900
Investing Activities
Cash receipts from
Sale of property and equipment 49,700
Collection of principal on loans
Sale of investment securities
Cash paid for
Purchase of property and equipment -98,300
Making loans to other entities
Purchase of investment securities
Net Cash Flow from Investing Activities -48,600
[42]
Financing Activities
Cash paid for

Running head: MANAGING FINANCES
Repayment of loans -64,000
Dividends -33,000
Net Cash Flow from Financing Activities -97,000
Net Increase in Cash 2,300
Cash at End of Year 25,200
Budget
Budget is one of the tools that are used to identify the variances between the existing
positions of the company with respect to the forecasted figures. The figures are generally
forecasted to get an insight of how well the company will perform in future on the basis of
the past experiences. The budget has been prepared taking all the assumption into
consideration below. The variances are also calculated in terms of the percentage to get an
idea in terms of the margins (Chiu, et al 2018).
Budget Existing Forecasted Variance Variance
2014 2015 F-E %
Room Budget
Rooms Available 63875 57488 -6388 -10.00%
Rooms Occupied 51548 46392 -5156 -10.00%
Total Occupancy 80.70% 80.70%
Revenue per available room 134.8 178
Total Room revenue 6948670 8257849 1309179 18.84%
Food revenue 876760 1008274 131514 15.00%
Beverage revenue 183737 198436 14699 8.00%
Total Revenue 8009167 9464559 1455392 18.17%
Cost of goods sold 2322658 2744722 422064 18.17%
Gross Profit 5686509 6719837 1033328 18.17%
Less: Expenses
Staff costs 236725 342813 106088 44.81%
other costs 1121283 1199773 78490 7.00%
Net Profit 4328500 5177251 848751 19.61%

Running head: MANAGING FINANCES
References
Chen, H. (2017). Do cash flows of growth stocks really grow faster?. The Journal of
Finance, 72(5), 2279-2330.
Chiu, C. H., Choi, T. M., Dai, X., Shen, B., & Zheng, J. H. (2018). Optimal Advertising
Budget Allocation in Luxury Fashion Markets with Social Influences: A Mean‐
Variance Analysis. Production and Operations Management, 27(8), 1611-1629.