Judgement Case 9-1 – Inventory costs; lower of cost or market; retail inventory method Requirement 1 Theoretically, Hudson should account for the warehousing costs related to its wholesale inventories as a part of inventory. All of the necessary costs associated with preparing, and in this case storing, items for sale are to be included in inventory. The key here is that the warehousing cost is related to a particular set of items and for that reason it is important to account for the warehousing cost with the inventory in order to satisfy the matching principle. The matching principle “requires that revenues and any related expenses be recognized together in the same period” (The matching principle). By following the matching principle all of the costs associated with a particular product, not just its wholesale price, is expensed when the item is sold.
Authors Pearce and Robinson (2009) suggest, a balanced scorecard “Is a set of measures that are directly linked to the company’s strategy,” “Directs a company to link its own long-term strategy with tangible goals and actions,” and “Provides a framework to translate a strategy into operational terms” (p. 202). A balanced scorecard is comprised of four perceptions: financial, customer, internal business process, and learning and growth (Pearce & Robinson, 2009). Utilizing Kaplan and Norton’s development of the balance scorecard AB Cleaners (ABC) evaluated its strategies relative to their mission and vision. The preceding matrix echoes ABC’s measurements, its targets, and supporting initiatives for each of the four perspectives associated with the
Team B will evaluate the fees and cost-volume-profit (CVP) analysis to make sensible decision on behalf of Snap Fitness center (Kimmel, Weygandt, & Kieso, 2009). CVP analysis The components the CVP analysis consists of sales, variable cost, contribution margin fixed cost, and net income. The company’s revenue stream demonstrates the variations of fees and capacity increases and decreases; the examination of this activity is CVP analysis. The CVP analysis provides information for the organization to plan according to the earnings. The organization needs to select the fees, promotion, location, and productivity methods to optimize profits.
It is “outside –in” thinking, which could help company to catch up with the market trend and develop products and services that meet the needs of customers. As we can see from the case, ECCO followed the inside-out strategy. * ECCO has a corporate strategy process that relies on the core competencies of the company to drive change, product development and innovation as opposed to external influences such as market, competition and customer preferences. The assertion by inside-out strategists is that a company achieves greater efficiencies and adapt more quickly to changing circumstances. ECCO is following an inside-out strategy (resource base strategy), whereas all the competitors seem to follow an outside-in strategy.
Set a pace of growth that will be sustainable, that will not rock the company to the core and in process set it back. BKD has learned this lesson from previous experience that put them in bankruptcy court. While implementing changes that will allow BKD to grow, the change managers and other managers within the company are setting a sustainable pace, one that the associates can grasp the change before others are thrown at them. Change is a way of life in the BKD organization, one that all associates strive to make a better place not only to work but to live. The vision and mission of the company are important components of any change that is implemented and by keeping them in mind, will allow the company to achieve the goal of being the leader in health and wellness for the
In the Petrie Electronics a request from the executive team has decided that the number one priority is to not only survive but to thrive and prosper by developing closer relationships with their customers. They also want to attract new customers and implement a customer loyalty program. 2. How are Organizational information systems related to company strategy? How does strategy affect the information systems a company develops and uses?
Compelling data revealed that many industries enjoyed productivity boosts due to SDT work systems, and Amasi felt they could be applied to plastic pipe manufacturing as well. It wasn’t until 2003, however, that Amasi recognized that the Corpus Christi plant provided the right environment for such a radical overhaul. From a strategic perspective, Amasi’s decision aimed at improving organizational effectiveness by reducing bureaucracy. The case author coined this reduction “flattening,” as the hierarchical chain of command was stripped down to a simplified, more even playing field. Subsequently, authoritative decision making power took place via active horizontal participation, rather than through directive channels from above.
Why would directors be more efficient than shareholders at improving managerial performance and changing their incentives? Directors would be more effective at altering the performance of managers specifically because they have a position to more directly control the managers’ incentives. Shareholders can only periodically vote on large issues, which do not directly affect the individually efficient behavior for managers. Directors, on the other hand, can adopt policies that tie the managers’ compensation to their performance, or threaten them with loss of their jobs if they perform below a certain
The comparison of overhead costs for Polynesian Fantasy and Vanilla by the two costing methods is: Polynesian Fantasy Vanilla Old Costing method 5.6 5.4 New Costing method 9.06 4.65 Change (New-Old) 3.46 (0.75) There won’t be any change on total company profits. But it will be some differences on individual product between applying two methods. What should Will do The new method (Activity-Based Costing) attempts to provide a better model of the cost of producing products or providing services and delivering them to customers. It promises to depict costs more accurately through a deeper understanding both of the activities involved and the resources consumed by each of these activities. Will should use Activity-Based Costing.
* Reports to Max Brisco, Vice President of Manufacturing. * Managed an in-house warehouse that housed the raw material inventories and, maintained adequate buffer inventories. * Executed purchase contracts with vendors, ensuring specifications were met while achieving the best possible price. Basic Issues: * Materials and purchasing department had over 350 vendors for raw material supply. * Raw material lead time ranged from few days to 6 weeks, causing delay.