For this task I am going to compare three different types of loans which are provided by Halifax, NatWest and Alliance and Leicester. I have chosen to get a loan from these banks because they are reliable.
For this task I am going to compare three different types of loans which are provided by Halifax, NatWest and Alliance and Leicester. I have chosen to get a loan from these banks because they are reliable. Halifax Personal Loan Whether you're thinking of changing your car, making some home improvements or looking to simplify your finances into one manageable monthly payment, applying for a Halifax Personal Loan is quick and easy. Plus, you don't have to make any repayments for the first three months! Rate of Interest: 6.4% typical APR for loan over £7,000 Alliance and Leicester Personal Loan Alliance and Leicester lets you borrow an amount of money between £5,000 -£20000 with an interest rate of 6.1%. It also lets you take loans for up to 5 years with low, fixed monthly payments. NatWest Personal Loan NatWest offer a selection of loan products tailored to meet our customers' varying needs. So, whether you're looking to buy a new car or conservatory, need a financial boost during your studies or require a helping hand as a graduate, they're there to help. Their rate for fixed-rate personal loans of £10,000 or more is just 7.4% APR typical. I have chosen to take up a loan from Alliance and Leicester because they have the lowest interest rate of the three, which means I won't have to pay as much interest as I would to NatWest or Halifax. By choosing Alliance and
TO: The PQR Company (Current Shareholders) FROM: Financial Accountant SUBJECT: Assessment of Financial Performance and Position of PQR DATE: 10th December 2004 INTRODUCTION The report that will follow will outline the financial performance of PQR for the past 3 years. The Company's financial statements will be reviewed from 2002 till 2004 in order to obtain a picture of the company's financial position. The company's performance has been illustrated via Ratio Analysis. A detailed calculation of various ratios is obtainable from the appendix. However a summary table has been included below for reference. RATIOS 2002 2003 2004 PROFITABILITY RETURN ON CAPITAL EMPLOYED % LIQUIDITY CURRENT RATIO QUICK RATIO EFFICIENCY DEBTORS DAYS CREDITORS DAYS STOCK DAYS 12.1 4.3 1.5 61 33 136 12.7 3.5 1.8 48 48 107 13.0 2.6 1.3 47 44 81 The report will be split into Profitability, Liquidity and Efficiency, under which the company's financial statements will be analysis to some degree. The conclusion will bring the report together. PROFITABILITY As can be seen from the data supplied sales have increased from £3,600,000 to £4,010,000, an increase of 11%. Calculation based on the difference between 4,010 and 3,600, over 3,600. At the same time cost of sales fell. We can straight away tell the company's gross profit
Enron was born on July 1985, when Houston Natural Gas merged with InterNorth natural gas Company based on Omaha, Neb, and Kenneth Lay who became Enron's CEO in February 1986. In 1989, Enron began trading natural gas commodities. The company eventually became the largest merchant in North America. Enron had 21 thousand employees, operated a 25 thousand-mile gas pipeline system. It was listed as the seventh-largest company in the U.S, with a revenue of nearly 101 billion of dollars. Its bankruptcy occurred on December 2, where Enron had listed 24.7 billion dollars in assets. The collapse of energy giant Enron is the largest bankruptcy and one of the most shocking failures in United States corporate history. It embraced new technologies, established new methods of trading in energy and seamed to be a shining example of successful corporate America. But the company's success, were based on artificial inflated profits, dubious accounting practices, and some say fraud. The firm's success turned out to have involved an elaborate scam. Enron lied about its profits and stands accused of a range of shady dealings, including concealing debts. The profits eventually did not show up in the company's accounts. As the depth of deception unfolded investors and creditors retreated, forcing the firm into bankruptcy in December For Enron employees and retirees themselves, the consequences
Task 3 D1 It is now 12 months since Jane started the business. During the year she has had time to reflect on month to month trading. She has asked you as a friend to write her a report outlining the following: . What courses of action could be introduced to control the business's cash flow most effectively? 2. How will this contribute to the overall effective performance of the business operation and ultimately maximise cash flow. CASH FLOW FORECAST "Cash flow forecasting means preparing a cash flow statement for the future with predicted inflows and outflows." (Source: BTEC First Business) A business often prepares a cash flow forecast showing the money likely to flow into and out of the business in a given period. Forecasts are based on past experience of the business. Cash flow forecast include revenue such as cash sales, credit sales, loans and expenditures like wages, insurance, loan payment, etc. BUDGETARY CONTROL "A Budgetary control is a system of creating budgets, monitoring progress and taking appropriate action to achieve budgeted performance." (Source: www.brunswickis.co.uk) Budgetary control is a process of monitoring and analysing financial control within organisation. Budget "A budget is a plan, which is set out in numbers. It sets out figures that an organisation or company hopes to achieve in the future." (Source: THE TIMES 100) Budget is
Business Finance. There are a number of sources of finance, which businesses will need in order to start up a new business, make their business expand and buying materials required for their business.
AO1 Unit 3 Finance There are a number of sources of finance, which businesses will need in order to start up a new business, make their business expand and buying materials required for their business. - Mortgage: A Mortgage is a source of finance that is used to help fund purchase of a property. This is a very long-term method of borrowing money which requires some form of security. The money will later have to be paid back to the bank along with interest. If this money is not paid back there are people who are known as bailiffs who will come to your house to repossess the belongings needed to pay off the mortgage taken out. Mortgages can be borrowed by Company, Building society or Bank. Advantages The Advantages of this method are that the interest charges tend to be lower than other sources of finance. Also you can take out the money for long period of time, this can be easier for a business because it'll give them a chance to set up and keep the business running and then later on if the business becomes successful and makes a lot of money, and they can then pay off the mortgage which was taken out. You can Retain Ownership; this means instead of raising funds by selling a share in the property or the business to an investor you retain complete ownership. There is also Tax Advantage because interest expenses on your mortgage are tax deductible and are made with
Business Costs In a business there are three different types of business costs these costs are: Direct & Indirect Direct costs are expenses that can be attributed making a particular product such costs include factory labour, raw materials and operating machinery. Indirect costs are the general overheads of running a business for example; salaries, telephone bills and rent. Firms that make more than one product will want each one to earn enough sales revenue to cover its direct costs and make a contribution to indirect costs. If all the products together make enough contribution then the business will make a profit. Fixed & Variable Fixed costs are costs which do not vary. They are mostly indirect costs - Management salaries, telephone bills and office rent. They have to be paid even if the firm produces nothing. Variable costs are costs that cab change every time a bill etc... must be paid, these are mostly direct costs such as factory labour, raw material etc...Some costs are semi variable, they only vary slightly because they have a large fixed element, for example workers wages - most people receive a basic salaries and only part of their pay is linked to output. Fixed costs are usually only fixed over a short period of time, if a firm is expanding, it will take on more managers and rent more offices so the fixed cost will increase. A firm can work out their
Cash flow. A cash flow forecast is a document that predicts cash requirements in the future. It helps a business save money for things it may need in the future
Cash Flow A cash flow forecast is a document that predicts cash requirements in the future. It helps a business save money for things it may need in the future. Financial problems may arise if the business has more outgoings than income, such as unpaid bills or sudden money loss making the business low on money. Another business could also owe money to yours and go bust. The business is most vulnerable to cash flow problems when they first start up as this is when there are more outgoings than money from customers. Certain areas, such as production, could have difficulties operating as the costs are too high. Businesses may also have cash flow problems due to other reasons, such as not selling as well as expected. A business can improve their financial situation by borrowing money from a bank, cutting costs or increasing sales. Businesses use cash flow forecasting to anticipate months where they may have a shortfall and get ready for them by taking action before they happen. It may help the business if they identify areas where the business was weak or strong and change strategy to deal with any problems and maximise potential. The five parts of a cash flow forecast are: Receipts, payments, excess of receipts over payments, opening bank balance and closing bank balance. Cash Inflow: This section shows how much the business (in this case, a garden centre) has loaned from
Task One In task one, we have been asked to identify 4 different costs that James and Lucy have to pay, these costs are; start up costs, running costs, fixed and variable costs. Fixed Costs- Fixed costs do not change with production. No matter how much profit that you make you will still have to pay for things such as: rent, business rates, and interest on loan payments, insurance, salaries. Fixed costs always stay the same, even if you make no profit at all. Variable Costs- Variable costs change with the number of goods and how much a business tends to make. The costs increase as the more profit you bring back to the business. Examples of Variable costs are: raw materials, refreshments for customers, and wages Starts up costs- Start up costs are costs in which you only ever pay once, and that is usually at the start of the business. Examples of start up costs are premises, machinery, equipment, fixtures and fittings and market research to start up the business. Running Costs- Running costs are paid everyday to run the business, examples of these are wages, bills, raw materials and insurance. Fixed Variable Rent £40 Each Box purchased each day: £5.50 License for Trade £20 Block of Ice £50 Delivery Charge (weekly) £14 Total £124 Total : £27.50 Overall Total: £151.50 Fixed Variable Rent £40 Each Box purchase £55 License of Trade £20 Block of Ice
BTEC First Diploma in Business Unit 3 Investigating Financial Control Introduction: In this assignment i will prepare an annual cash flow forecast using monthly datas and analyse the implications of regular and irregular cash inflows and outflows for a business organisation. I will also evaluate how cash flows and financial recording systems can contribute to managing business finances. Task 1 a A Cash flow relates to the amount of money received and spent in the given period. Cash flow problems occur when the amount spent is greater than the amount received and Cash flow statement is normally produced in a little more detail than the summary statements. A cash flow statement or statement of cash flows is a financial statement that shows how the inflows and outflows affect the business. The cash flow statement is useful in determining the short-term usefulness of a business. It is good if you have to pay bills and Cash flow forecast means preparing a cash flow statement for the future with predicted inflows and outflows. This is always easier to do for an established business because managers have more experience and knowledge on which to base their decision. In my opinion cash flow refers to the difference between the cash flowing into the business for example through sales revenue and the cash flowing out of the business for example bills and wages. A cash flow
Stock Market Crash A stock market crash is a sudden decline of stock prices in stock markets. It usually happens due to panic among stockholders and various economic factors. These crashes usually occur after a long period of rising stock prices (due to going speculations), when P/E ratios are far above their averages. According to Benjamin Graham, the father of securities analysis, there are three main forces behind the market crash: the manipulation of stocks, the lending of money to buy stocks and excessive optimism. The most famous market crash, the Wall Street Crash of 1929, also known as Black Tuesday, happened on October, 29 1929. It is regarded as a start of the Great Depression. All of the three forces mentioned above contributed to this crash. American economy was blooming in the 1920s. NYSE was the largest stock market in the world. From 1920 till 1929 many stocks quadrupled in value. Thus, many people invested their money in stocks, expecting to gain profit. It led to speculative boom that took place in late twenties: the rising share prices were encouraging people to invest even more. Many of the investors had to borrow money to buy stocks but they only had to have 10% equity and 90% margin to buy securities. Speculations on stocks stimulated further price rises and created an economic bubble. The P/E ratios in 1929 were far