Finance and Accounting for Business - Essay Example

? Assignment of Acc s Introduction The current era has been referred as the era of economic prosperity and economic expansion as a whole (CHOI, Frederick D. S., 2003, pp. 98). The traditional ways of enhancing financial competitiveness and economic prosperity has now changed entirely merely because of the arrival of new things in total (CHOI, Frederick D. S., 2003, pp. 98).. There are number of author’s in the world, which regarded organizations as a place in which there are hundreds of employees are working for a single and unified action, which is to increase the financial benefits in total. Apart from this particular definition, there are some other definitions as well, which analyze that organization is a place which surrounds with different departments of the company and every department has its own recognition and importance (RYAN, Bob, 2004, pp. 129). Among number of departments, the name of finance department is one of them. Finance department is responsible to manage and utilize the funds of the company as a whole. There are number of concepts that come under the ambit of finance and its related literature. Concepts are now moving and enhancing with perfection as well (WILLIAM G. DROMS, Jay O. Wright, 2010, pp.176). Among number of concepts, the name of fund management is one of them, which has its own recognition and importance in a broad nutshell. Managing the funds is an important provision and organizations always have to do something to do the same (NEELAN, Michael H., 2007, pp. 148). The main theme of this assignment is to pen down a sort of analysis broadly refers to cost management stance. The company name of Cycler mate and there are 4 different options from which the entire productivity of the company would be analyze accordingly. Option-1 Stop selling through cycle shops, and focus instead on building up direct mail order and internet sales Cost efficiency is one of the most integral and important part of an organization through which an entity could get the desired result (WARREN, David R., 1997, pp. 57). Organizations have to consider different options in order to get the things done accordingly. Currently, there are number of selling options are available which could be consider by a company or a management to pursue, merely to decrease down the level of cost association. In this scenario, the company is strategizing to go with internet based sales instead of focusing on the selling of the cycles through the cycle shops. Selling the cycles to the consumers with this particular action, will certainly decrease the level of cost of the company and resultantly will increase the financial belongings of the company as a whole. The budgeted figure of this scenario is mentioned below, Sales units price ? Cost Per Sale direct mail order and internet 1,100 700 1.57 cycle shop 1,400 420 3.33 The comparative analysis of direct mail order and internet and cycle shop is mentioned below in details, year to 12/30/2012 12/30/2011 12/30/2010 12/30/2009 12/30/2008   units units units units units direct sales units 1,055 1,178 967 850 743 shop sales units 1,450 1,621 1,334 1,172 1,010 Total units 2,505 2,799 2,301 2,022 1,753 Difference 395 443 367 322 267 Project Revenue through Direct Sales = 1100 * 700 = 770,000 Project revenue through Cycle Shops = 1400 * 420 = 588,000 Difference = 182,000 270 more cyle units would have been sold by the company to increase the revenue through direct selling 1100 + 270 = 1370 * 700 = 959,000 In order to break even, sales through cycle shop should be of 1833 units in total Project Revenue through Direct Sales = 1100 * 700 = 770,000 Project revenue through Cycle Shops = 1833 * 420 = 770,000 The main strength of this particular strategy is getting the figure of the units which would have been required by the companies to use accordingly, while there is no risk associated with the same. Option-2 According to the analysis, the price which was mentioned in the year 2011 was the best price for the company as a whole which maximizes the profit of the company. Total 1178 units have been made at the same time and the price per sales was 760. Total revenue generated through this particular stance is mentioned below, Units = 1178 * 760 = 895,280 Opportunity Profit Maximization = 1100 * 760 = 836,000 Difference occurs = 59,280 78 more units would have to be sale with direct mail strategy in order to break even with the highest price. It is not a fruitful strategy in this particular scenario to go with because there is nothing in relation with the strategy of profit maximization in this particular scenario. This needs to be overcome accordingly. Option-3 Majority of the authors lie on the fact that, organizations is a place wherein number of people of different demographics and mindset works together in the achievement of a single and pre specified goal in total. Apart from this basic definition, there are other definitions as well which could be taken into same consideration and according to the same, there are number of departments work in an organization and every department is liable to give its cent percent efforts for the analytical stance. The entire productivity of an entity lies on the fact that, how effectively every department of a company works together. If a department is working effectively, then the chance of economic prosperity of the company would be on a higher scale and vice versa. Among number of departments, the name of marketing department is one of them. There are number of options and literature has been found in this particular literature. Advertising is one of the basic and most dominating medium of marketing. Major advertising campaign should have been taken into account for the same in order to improve the sales. The company has to consider the advertisement through different traditional mediums like television, social media and paper media. These strategies would certainly be profitable from the standpoint of the company and it will be recommended to use the same in future. The main risk inherit with this particular strategy is that advertisement might not work as accordingly as the company is thinking and it might increase the net cost of the company and resultantly will decrease the bottom line of the company as a whole. It is extremely important for the company to make sure that minimum amount of cost would have been generated through the stance of advertisement and the sales and net income of the company should be increase accordingly, otherwise it will become quite difficult for the companies to increase their sales. Let’s now move towards the last option available of the report. Option-4 Cost is an important factor to consider and organizations have to consider the same in order to become cost efficient and economically viable as a whole. Cost should be retaining on a lower level in total in order to bring economic prosperity towards the company as a whole. In big organizations this particular thing could be quite important in total (SAMUEL WEAVER, J. Fred Weston, John Frederick Weston, 2004, pp. 282). Cost is also associated with different sorts of sources of finance, which predominantly are, issuance of shares, bank loan, bank overdraft, retained profit, buying goods on credit from the suppliers and other family members. Among these mediums, bank loan, bank overdraft and credit from suppliers are quite costly because these mediums requires the party to back the things by considering and applying a high interest rate from the same. This question requires to analyze the cost of manufacturing through two different options in total. One option is to manufacture in house and second option is to buy them ready made. While manufacturing in house there are number of direct and indirect cost which assaults on the total revenue of the company as a whole. The higher these cost the lower the net income of the company would be. Total revenue in this scenario would have been decreased, because raw material have to use both direct and indirect costing with high amount of labor association with it, while readymade production does not need anything relating to the same and it will be more fruitful for the company as compared to the other strategy. Bibliography CHOI, Frederick D. S. 2003. International Finance and Accounting Handbook. Trenton: John Wiley & Sons. NEELAN, Michael H. 2007. Focus on Finance and Accounting Research. New York: Nova Publishers. RYAN, Bob. 2004. Finance and Accounting for Business. New York: Cengage Learning. SAMUEL WEAVER, J. Fred Weston, John Frederick Weston. 2004. Finance & Accounting for Non-Financial Managers. London: McGraw Hill Professional. WARREN, David R. 1997. Financial Management: An Overview of Finance and Accounting Activities in DOD. Olympia: DIANE Publishing. WILLIAM G. DROMS, Jay O. Wright. 2010. Finance and Accounting for Nonfinancial Managers: All the Basics You Need to Know. Jersy city: Basic Books. Read More