AF5001: You have just graduated from University and found a job at a local bank as Financial Executive A client, Westwood Hotel: Financial Management, Assignment, DIC, Singapore

ASSIGNMENT BRIEF

CASE/ SCENARIO

You have just graduated from University and found a job at a local bank as
Financial Executive. A client, Westwood Hotel, a renowned 5-star hotel at Sentosa, approaches your bank for business advice. Mr. Benson, the owner of the hotel, decides to expand the business due to its consistently high occupancy in the hotel for the past ten years. He hires you as the Financial Consultant to examine a few financial issues and to advise him on these issues.

The report must be 2000 words in length and follow the guidelines stipulated
in the assignment brief. Your report must contain the answers for the following
tasks.

TASKS

1. Mr Benson would like to evaluate a few different investment evaluation
methods for his business expansion; net present value (NPV), payback
and internal rate of return.

Advise him on the features of each investment evaluation method and discuss
each method’s advantages and disadvantages. Finally, advise him on the best
investment evaluation method for his business.

2. Using the given financial statements (refer to Appendix), compute the
following ratios for two years.
– Current ratio
– Acid-test ratio
– Asset turnover
– Accounts receivable turnover
– Average accounts receivable collection period
– Debt to equity ratio
– Net profit margin
– Return on shareholders’ equity

4. Review sources of financing available to the Westwood Hotel and
recommend the best financing option for this hotel.