Problem Solving slides include topics such as budgets waste management and cost management and step by step guide to solve these business problems

1. INCLUDES:
1. BUDGETS
2. WASTE MANAGEMENT
3. COST MANAGEMENT

2.  Relative to that hotel, answer all the following questions:
1.How do you think this business could be divided into cost centers? Why
might the organization choose to make these divisions?
2.How will budgets contribute to operational efficiency and what types of
budget might be appropriate for such an organization? Why?
3.For each of the areas in the hotel, what direct and indirect costs would be
applied and why must they be considered when drawing up budgets and
developing financial reports?
4.What financial reports might be of benefit to this establishment? Why?
5.What types of waste might it be necessary to carefully monitor and control
and why would this be necessary?
6.Who should be responsible for collecting, inputting and recording the data
that contributes to budgets and who should be responsible for monitoring
budgets – to determine how well performance is meeting expectations?
Why?
7.What types of budget deviation might occur and what should be done if
deviations are identified?
For more information : https://myassignmenthelp.com/answers/sitxfin402-manage-finance-within-budget-
unit-code-is-sitxfin402-manage-finance-wi.html

3.  Hotels provide many services separately such as café bar,
lounge etc. They all can be divided into different cost centers.
 Restaurants do not only provide food but also may provide
lounge, café bar, piano bar etc. Different hotel managers are
responsible for increasing the profit of their cost centre thereby
increasing the profit of the hotel.
For more information : https://myassignmenthelp.com/answers/sitxfin402-manage-finance-within-budget-
unit-code-is-sitxfin402-manage-finance-wi.html

4. The limit of expense of a hotel is already set
at the starting of the year. This helps the
managers to increase the efficiency of
operations. Master budget is prepared for
individual department.
Departmental budget is for the staff of hotel.
Many budgets are provided to reduce the
complication and increase the productivity by
each department. Operating budget relates to
correct cash flow and for normal business.
For more information : https://myassignmenthelp.com/answers/sitxfin402-manage-finance-within-budget-
unit-code-is-sitxfin402-manage-finance-wi.html

5. Accommodation
• Direct Costs:
• Sales
• Labour
• Supplies
• Indirect Cost:
• Insurance
• Salary
• Rent
Restaurant
• Direct Cost:
• Food
• Certain materials
• Labour
• Supplies
• Indirect Cost:
• Depreciation
• Insurance
• Salary
• Rent
Bar
• Direct Cost:
• Soft drink
• Food cost
• Materials
• Direct Labour
• Indirect Cost:
• Rent
• Lighting
• Power
• Electricity
expenses
For more information : https://myassignmenthelp.com/answers/sitxfin402-manage-finance-within-budget-
unit-code-is-sitxfin402-manage-finance-wi.html

6. They help to provide the true or fair view of the profit or loss
of the company which helps the investors and shareholders
to know its actual condition. It helps the management to
increase profit if a cot centre has low profit or no profit.
The financial reports such as the independent auditors
report, annual reports, balance sheet, income statement,
cash flow, director’s report are all beneficial in taxation
legislation and its effect on its pricing. Break even analysis
estimates the earning capacity of a new area in the hotel.
For more information : https://myassignmenthelp.com/answers/sitxfin402-manage-finance-within-budget-
unit-code-is-sitxfin402-manage-finance-wi.html

7. Cause
• Large area
• Many activities
Things needed to be
protected
• Food
• Electricity
• Water
• Assets of hotel.
Ways to reduce
waste
• Recycling of
waste materials.
• Correct
estimation of no.
of people availing
the service.
• Proper budgeting.
• Controlling
industry
standards
For more information : https://myassignmenthelp.com/answers/sitxfin402-manage-finance-within-budget-
unit-code-is-sitxfin402-manage-finance-wi.html

8. Budgets are useful only
when they are incorporated
into the book of accounts
properly and its exact
position is known. There
should be a person whose
duty should be to collect,
input and record data so
that if anything goes wrong
then he can be held
responsible.
Management will be
responsible if they fail to
identify the person who is
responsible for which area.
The managing committee
and the directors committee
are held responsible for
budget monitoring. When
expectation is not met by
the department then it can
be assumed that data was
not properly collected,
inputted and monitored.
For more information : https://myassignmenthelp.com/answers/sitxfin402-manage-finance-within-budget-
unit-code-is-sitxfin402-manage-finance-wi.html

9.  Different types of budget variances are as follow:
 Material variance
 Labour variances
 Overhead variances: manufacturing, selling and distribution, Administrative.
 Profit variances
 Sales budget variance
 It is computed on the basis of Fixed budgeting system where budget variance = Budgeted
cost – actual cost. After identifying the variances we should
 Investigate the reasons.
 Identify the problem.
 Take corrective actions.
 If any of such deviations are identified than all of such deviation should be explained by the
management and must take proper measures to rectify all of them.
For more information : https://myassignmenthelp.com/answers/sitxfin402-manage-finance-within-budget-
unit-code-is-sitxfin402-manage-finance-wi.html

10. Thank
You