ACCOUNTING & FINANCE

Chancellors Hotel Manchester



Table of Content

Executive Summary2

Introduction3

Discussion4

Importance of Financial Ratios4

Analysis of Performance Indicators5

Conclusion7

Recommendation9

References10

Appendices11

Income Statement11

Balance Sheet12

Performance Indicators13

Forecasted Cash Flow for the month of April14

Forecasted Cash Flow for the month of May15

Forecasted Cash Flow for the month of June17

Forecasted Cash Flow for the month of July18

Forecasted Cash Flow for the month of August20

Forecasted Cash Flow for the month of September21

Creditor & Debtors23

Executive Summary

This report will analyze the financial performance of the Chancellors Hotel Manchester by evaluating its financial statements such as income statement and balance sheet for the period ended 2011. The report will also cover the financial ratios calculated on the basis of financial statements. Different financial ratios show different aspects of the company. It also helps to compare the company with its own performance, with the performance of the industry and with the performance of other companies which are related to the same industry. Liquidity ratios deals with all ratios which determine the ability of a company to pay off its short term debts. This shows that the company is / is not capable enough to pay off its short term debts. Asset Management Ratios are use by the companies to measure its success in managing the assets to generate revenue and sales. The report also presents the forecasted cash flow statements for six months of period from April 2013 to September 2013.

Chancellors Hotel Manchester

Introduction

This report will analyze the financial performance of the Chancellors Hotel Manchester by evaluating its financial statements such as income statement and balance sheet for the period ended 2011. The report will also cover the financial ratios calculated on the basis of financial statements of the said period. The report will analyze the financial performance of the company by comparing it with financial performance of other hotels which are Britannia Hotel located at Manchester City Centre and Mercure Manchester Piccadilly Hotel. The report also presents the forecasted cash flow statements for six months of period from April 2013 to September 2013. All of these hotels are three star hotels.

The report is totally based on performance indicators which were derived from the analysis of the income statement and balance sheet. The income statement is prepaid as per requirements. In income statement, the sales and costs of the departments are clearly shown under the title of the respective departments. Then sales and costs figures of each department were accumulated to get the final and total amount. It helped in analyzing the department's effectiveness as in the income statement it is clearly shown that how much each department contributes in term of sales and gross profit. The costs such as direct labour and direct expenses of each department are mentioned under the head of that department. While the generals expenses are applied to the whole business as company's overhead. The bad debt and depreciation expenses were deducted from current and fixed assets. The cash flows are forecasted according to the requirements. The cash from sales of current month is 60 percent of the total sales and ...