is 70%, it means 70%*150=105 rooms needed. Therefore, the profit/cost is:
Type Amount
Total fixed cost 5,643.27
Overhead 156.14*105=16394.7
Total cost 22,037.97
Revenue 218*105=22,890
Profit (revenue – total cost) 852.03
With 70% occupancy, the profit is 852.03.
c) If the occupancy is 90%, it means 90%*150=135 rooms needed. Therefore, the profit/cost is:
Type Amount
Total fixed cost 5,643.27
Overhead 156.14*135=21078.9
Total cost 26722.12
Revenue 218*135=29,430
Profit (revenue – total cost) 2707.83
With 90% occupancy, the profit is 2707.83.
Occupancy Number Profit
40% 60 (1931.67)
70% 105 852.03
90% 135 2707.83
3. Advise Memo
Financial management is related to asset investment, asset financing, cash flow management and profit distribution. Financial management is a component of corporate management to organize the corporate financial activity according to the regulation and rules.
The three main components of financial management involve Financial Planning, Financial Control and Financial Decision-making.
As a cash rich company, we should utilize well in order to keep efficiency and profitability.
For the financial planning, it can refer to the three primary financial statements -- balance sheet, income statement, and cash flow statement-- created within a
business plan (Broby, 1995). A financial plan can also be an estimation of cash needs and a decision on how to raise the cash, such as through borrowing or issuing additional shares in a company. Thus, we could make a detail plan for the usage of cash. For example, we should allocate the cash into several parts: money market (bonds etc.) capital market (stock, future and so on) and production. We could enlarge the production or invest in new industry or product line.
For the financial control, Management control of financial activities aimed at getting desired return on investment. For a cash rich firm, we should avoid the risk when investing in market. Diversification is one of best method to reach the goal. We could invest in various industries and control the problems or malfunction in production. Moreover, if financial problems occur, we could control the loss and prevent serious problem happening.
For the financial decision-making, when making financial decision, we may prepare well before the decision. Usually, market research is necessary and from market research we could clear the consumer p
Reference to the goods. Product design is essential so that we could produce a user-friendly product. After making decision, a well-prepared backup plan is important to avoid a huge loss.
Reference
Anthony, R. N. & Young, D. W. 1994, Management Control in Not-for-profit Organizations, 5th Edition, Irwin, Inc., Boston, MA.
Broby, L. 1995, Investment Regulation in Europe, FT Management Report, London.
Runyon, L.R. 1983, ‘Capital expenditure decision making in small rms’, Journal of Business Research, vol. 11, no. 3, pp. 15-22.
Silver, M. & Auster, R. 1999, ‘
Entrepreneurship, Profit, and Limits on Firm Size’, Journal of Business, vol. 42, no. 2, pp. 277-281.
Smith, C.W. 1996, ‘Option Pricing: A Review’, Journal of Financial Economics, vol. 2, no
本论文由英语论文网提供整理,提供论文代写,英语论文代写,代写论文,代写英语论文,代写留学生论文,代写英文论文,留学生论文代写相关核心关键词搜索。