Aim: To practise and demonstrate your understanding of cost modelling and budgeting in a management control contextSubmission Requirements:A single spreadsheet incorporating: a cost model; a budgeted income statement; a cash flow forecast; explanatory commentsA 1,000 word essay (+/- 10% not including references)Business ModelingSelect a business you are aware ofit need not be one you have been directly involved in, but it needs to be in the area of retailing, manufacturing, or services and not financial services. An example might be your employer or business, a local shop, a garage, or a hairdresser.We would like you to build a simple cost model for this business, using tools from this course such as break-even analysis. It is not necessary to model every product, you only need to build the model based on averages for the main two or three activities that the business carries out.Please Note: This is an imaginative exercise and you can make up both the products and the financial data. If you think things through carefully you might be surprised at what you have to go onfor example, floor areas, customer footfalls, and local population statistics.From this model, prepare a budget for the business for the next 24 months. You do not need to model the balance sheet, just the income statement. You will be provided with two forecasting models that you might like to look at for guidanceone is a simple income statement and cash flow forecast, and the other enhances this with seasonal variations and balance sheet forecasts.Please Note: You are not required to produce a balance sheet forecast for this exercise.Finally, we would like you to create a cash flow forecast for your model.You should include all of your modeling and calculations in a single (multi-page) spreadsheet, annotated with explanatory comments.You should, as far as possible, create a single linked model, so that changes to the cost assumptions (for instance) are carried through to the budget and the cash flow forecast.Record Keeping and Control EssayNow, imagine that you are the manager of this business, and that you have at least one employee. You are to set up a record-keeping system that helps you to control the business and manage the key risks, including regulatory and reporting risks.Write an essay of no more than 1,000 words outlining the main features of this record keeping system, identifying the objectives and the potential cost of running it.Key Specifications and RequirementsYou may refer to any of the materials and tools introduced on the course but must:Set your work out as a essay.Ensure that your essay has an introduction and a conclusion. Be clear about the use of paragraphs.Write in the third-person (e.g. This essay considers..; From the evidence it can be concluded that…). In other words, avoid use of I or we or our.Label any diagrams used (e.g. Figure 1), give it a title, and credit the source.Use Harvard referencing accurately.