• Join over 1.2 million students every month
• Accelerate your learning by 29%
• Unlimited access from just £6.99 per month
Page
1. 1
1
2. 2
2
3. 3
3
4. 4
4

Impact of Finance on Business Decisions (Appraisal Methods)

Extracts from this document...

Introduction

Impact of Finance on Business Decisions Task C Introduction In this assignment I will be looking at two businesses's which will need to be compared to find out which method it should be taken. These calculations will show me what way they should go so it would benefit them profitably wise, either on a long or short-term basis. The calculations would show me the term for 3 years and what I will be making and what I will be losing. From the calculations calculated I will make a decision on what stages could be best suitable for them to make the payback. The business Lee Ltd has the funds to put forward for a "Transport Project" or a "New Networking Project". It is up to them to see what project is best suitable for them and which one they would go for. The firm has a decision whether they want to go along with Transportation or Network Project the figures show... Appraisal Methods For every business to know where they should invest their money it is essential to research what they should do. This is either by investing in a long term project, invest in a machinery to see whether that equipment will come to any use and provide goods more then it actually cost. ...read more.

Middle

ARR (Account Rate Return) - This method shows how much percent the business owes. It is a good explanation for working out what amount is going. The ARR is calculated by taking the Expected Average profits and dividing it by the Initial Investment. Before working out the calculation the Expected Average Profit needs to be calculated, this is by adding up all the Net Cash Savings and dividing the total by the amount of years. By working out the figure it showed that the Account Return Rate was 30.747% for the finance returned Strengths and Weaknesses for Investment Appraisal NPV Advantages - * This is a good way of finding out what method is realistic and how much value its cash would give them. * It is a clear way of showing the future's capital. * Not Hard to work out but a calculation needed with expertise. Disadvantages - * The discount percent is made up by the organisation. * Estimate is not always correct. * It is the hardest method to calculate. PBP Advantages - * This way of calculating finances is simple and quick to understand * This method is helpful to work out any liquidity issues * The shorter the payback period the safer the business * Not hard to plot Disadvantages - * After payback periods have been settled the cash flow is not looked upon properly. ...read more.

Conclusion

The problem with vehicles rented is that if any damage is caused then charges are high. Being able to deliver goods on time also makes a difference as it leaves customers satisfied. Advertisements cold be made on their own vehicles which would increase publicity. Benefits of Network Project There are many benefits of investing in a network project as they could make the accounting easy as it would not require high level of skill to do them. Having a well updated network would help Lee Ltd to get their business online and be able to sell goods on the internet. This would lead to a 24 hour service available to everyone. Conclusion The conclusions which I have decided for the project to be invested in would be the transport project as it shows better reasonable calculation from the NPV and ARR. These aspects show that Lee Ltd would get a higher rate in return if they were to keep the investment continued for a longer basis. If the PBP is longer the Networking Project this would not make a lot of difference as to paying back period. The idea of having the Networking Project is not bad as this would help them in the future to get their business online and be able to publicise their business. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level People & Operations Management section.

Found what you're looking for?

• Start learning 29% faster today
• 150,000+ documents available
• Just £6.99 a month

Not the one? Search for your essay title...
• Join over 1.2 million students every month
• Accelerate your learning by 29%
• Unlimited access from just £6.99 per month

Related AS and A Level People & Operations Management essays

This intranet is an email facility that is used in the Tesco to get email from one worker to the other or from one department to the other. This method is very cost effective and fast, managers and all the other employees can respond with each other in seconds, they can send large "attachment" to the staff.

2. The main aim of this research is to evaluate the information on the human ...

feels they have good values and they are encouraged to survive in that organization. Some organizations have its own teams in human resource management. But in this case, permission must be granted from leadership of organization and organization chief executive board officer also included in organization leadership.

CAFOD is classed as a large organisation because it has thousands of volunteers working for them, and they operate in over 200 countries so they are multinational. Workers are not rewarded with money in return of their help because they choose to work voluntarily.

The corporate as big as Canal Court knows that providing high quality services is essential in their labour, so they put any efforts to have a highly qualified staff that in their every day work are showing their professionalism which is linked to producing high quality.

The reason for why we are holding this event is to raise money for 'Great Ormond Street Hospital'. This is because we all agreed that we would be keen to make money for this charity. This charity raises money for the hospital to provide exceptional care for young patients and to discover new treatments and cures for their illnesses.

2. Unit 2: Recruitment in the Workplace

are that the organization will provide you with annual leave, sick leave and health insurance also the hours they work are more flexible however, the most popular and more rewarding benefit is the fact that full time workers will get paid more money that part time workers because they are dedicating more time to the business.

1. AO3 Managing Finance

CASH FLOW MANAGEMENT Money is the oxygen that enables a business to survive and prosper and is the primary indicator of business health. While a business can survive for a short time without sales or profits, without money it will die.

2. Investigating Customer Service at a school and at Asda.

If there are any problems, they will expect to be told straight away. For example, YPO, the school's stationery supplier will expect to be informed if anything delivered has arrived late or any products received were below the expected standard.

• Over 160,000 pieces
of student written work
• Annotated by
experienced teachers
• Ideas and feedback to