If there is a rust spot like that, i guarantee there is more rust on the floor pan. If you have the time an energy to replace the entire floor pan, go for it. If not you have two alternatives that My brother did with his car.
-Either you clean up the rust as best you can, Use a wire brush and scrub it hard, then spray it with a rust inhibitor you can buy at any auto store. Then buy some FIBER GLASS bondo and smother it all over the hole, this will hold for a decent amount of time and flex so it wont crack, plus keep water out.
-Or, you can cut out a square of where the rust spot it and replace it with a piece of sheet metal. I wouldnt suggest doing full beads on the weld, it will more than likely burn the metal. Just tack weld every centimeter or so, then cover up the holes around the weld with fiber glass bondo.
Keep in mind my brother is no expert here on welding or fixing rust, these are just a few options for a budget fix
My brother also used a chisel and hammer to remove the tar padding, actually worked very well.