MFRD Essay Example | Topics and Well Written Essays - 2500 words

MFRD - Essay Example This is one of the major decisions that a manager is faced with. He has to decide how the available resources will be utilized efficiently. Financial resources are always scares and limited. Therefore, they have to be put into the best possible use that will give optimum benefit to the organization. The manager has to spend them in the order of priority and urgency (Baker and Powell, 2007). The best way to ensure good services is to ensure proper planning of the way financial resources will be utilized. The manager has to point out the financial shortages and surpluses. Financial statements are important in this since they help managers to control the resources and make the right decisions. Through them, the manager is able to predict the costs and expenditure. He will in turn make the right decision on how to use the resources available to meet the costs. This essay focuses on the issue of financial resource management and decision making in an organization. It discusses the various sources of finance, their advantages and disadvantages as well as how budgets can be used to help in decision making. The essay is based on Mr T. Jones Fast Foods Restaurant. The source of finance for a business depends on the type of business and the stage at which the business is (i.e.) a start -up business or a continuing business. The larger the organization, the wider the variety of finance sources available to them. In case of a start- up business, the initial investment is referred to as capital. The sources of this capital could range from savings, inheritance, loans as well as investments. This is the most difficult part of starting a business. The entrepreneurs need to get enough capital to start the business and get it going. When the business is on -going or becomes established, it has ways in which it increases its capital. The capital can be increased through internal means or external means. Internal sources of finance are the funds that are