In this case we get an entire scenario about how the Japan deflation set in, what were the effects of the deflation on the economy as well as on the people of Japan. It also mentions about the various reasons because of which Japan was in such a tight grip of Deflation, Depression, Demographics and Debts Guides us through the steps taken by the government in order to curb this deflation. Imparts a great knowledge to us about the various economic terms like deflation, self-liquidating credit, Non-Self Liquidating Credit and how the people and economy of a country is affected by these.
Free markets economies are subject to cycles. Economic cycles consist of fluctuating periods of economic expansion and contraction as measured by a nation's gross domestic product (GDP). The length of economic cycles (periods of expansion vs. contraction) can vary greatly. The traditional measure of an economic recession is two or more consecutive quarters of falling gross domestic product. There are also economic depressions, which are extended periods of economic contraction such as the Great Depression of the 1930s.
From 1991 through 2001, Japan experienced a period of economic stagnation and price deflation known as "Japan's Lost Decade." While the Japanese economy outgrew this period, it did so at a pace that was much slower than other industrialized nations. During this period, the Japanese economy suffered from both a credit crunch and a liquidity trap....
...000) / 1.96 = 5,102 units.
So, we have a distribution with a mean of 20,000 and a standard deviation of 5,102.
2. Compute the probability of a stock-out for the order quantities suggested by members of the management team.
Using the normal distribution theory, we discover that as the ordered quantity increases the probability of stockout decreases.
At 15,000 the probability of stockout will be 0.8365
At 18,000 the probability of stockout will be 0.6517
At 24,000 the probability of stockout will be 0.2177
At 28,000 the probability of stockout will be 0.0582
3. Compute the projected profit for the order quantities suggested by the management team under three scenarios: worst case in which sales = 10,000 units, most likely case in which sales = 20,000 units and best case in which sales = 30,000 units:
Order Quantity: 15,000 were cost price is $16, selling price $24 & after holiday selling price $5
|Unit Sales |Profit |
|10,000 |25,000 |
|20,000 |120,000 |
|30,000 |120,000 |
Order Quantity: 18,000 were cost price is $16, selling price $24 & after holiday selling price $5
|Unit Sales |Profit |
|10,000 |-8,000 |
|20,000 |144,000 |
Mary Roberts had been with the company three years when she was promoted to manager of the tax department which was part of the controller’s division.Within four months she became a supervisor of ten staff accountants to fill a vacancy.Her superior believed her to be most qualified individual to fill the position.
Many senior employees resent her that she so young to fill the position and what made them more upsets was the fact tax managers did not discuss the promotion.
1.What can Mary Roberts do about the resentful senior employees?
Mary should tackle this head on she should be direct and assertive about her expectation and when people are crossing the line that means she need to be clear with people when their behavior doesn’t meet her standards and she need to be willing To set and enforce consequence if it doesn’t change
2. Can higher management do anything to help Roberts make the transitions to greater responsibility?
Yes, because they are the one who put her in that position of course they will help Mary interms of guiding it `.
3. Will her lack of technical knowledge hinder Mary’s managerial effectiveness?
No , because lacking on some aspects on technical knowledge cant bankrupt or destroy a company as long she have a guts to face and accepts failures
4. Should Mary’s superior have discussed the promotion with the senior employees before announcing it?
No ,because its not their obligation...
...February of 1999. In the past four months, the NC design had developed
sustainability. The Bostrom alliance agreement for the truck market had been concluded. The
question about Elio's strategy for the entry into automobile still remained. Should Elio's joint
venture with Bostrom? Should it partner with a tier-one or a tier-two automotive supplier?
Was Elio's technology strategy aligned with the requirements for a successful entry into the
automotive market? Paul and Hari realized that they needed answers to these questions in
the coming days.
This casestudy discusses the start-up, origins and strategic options facing an innovative set up
and start up in automotive market and in the seat design. With the domination of the
incumbent large suppliers serving the top 3 leading tier-one automakers of U.S.,
Engineering faces several challenges as it seeks to introduce its new seating technology to the
market. The case can serve as vehicle to discuss important themes such as technology and
business strategy, invention and innovation, bringing technology to market and profiting from
Elio's should make a joint venture with Bostrom. Elio's has made a seat design naming "No
Compromise" with progress on cost, weight and performance compared to the conventional
design and also the existing all-belt-to-seat (ABTS). After many functional prototypes and
computer aided structural analysis, a perfect design...
...IRR of the project.
We are assuming that all cash flows take place at the end of the year, we end year 0 by a cash outflow of 1,050,000, year 1 we have an inflow of , year two we have an inflow of , and year three an inflow of . It takes 2.1 years in order to recover the initial investment, payback period equals 2.1 years.
As a rule we accept any project with a net present value greater than 0. The NPV takes into consideration the cost of financing by discounting the cash flows by the weighted average cost of capital which leads to good decisions. In the case of Dinky Company the NPV was $304,976.61 so the project should be accepted.
The internal rate of return is an alternative to the NPV method. This method is internal to the project, and only relies on the cash flows of the project. In our case we would compare the IRR of to our WACC of 13.3%. Our IRR is significantly higher so we should accept the project based on the Internal Rate of Return method.
Question 4: Should the capital-budgeting committee accept the proposed project? Discuss.
Since the project passes the payback period test, the Internal rate of return test, and the NPV test it should be accepted by the committee....
...Principal of Management
CaseStudy: Toys Galore
The CaseToys Galore is a major manufacturer of toys which faces uncertainty about demand for its toys during the Christmas season. If there is a high demand for toys, and if Toys Galore:
* Is fully able to meet this demand, then it makes additional revenue of $4m.
* Is partly able to meet this demand, then it makes additional revenue of $3m
* Is able only to supply at a low level, then it makes no additional revenue.
If, however, there is low demand, then it makes no additional revenue. In July, Toys Galore has the option of expanding production. An expansion will cost $2m. If it expands in July, then it will be fully able to meet a high demand at Christmas. If it decides not to expand production in July, then it has another chance to expand in October. An expansion in October also costs $2m, but this late expansion does not leave the company sufficient time to fully meet high demand at Christmas; it can only partly meet any high demand.
In October, however, the ABS announces the latest national income figures.Past experience suggests that income figures are high half the time and low half the time. Past experience also suggests that if there is a high national income figure, then there is a 80% probability of high demand, and if a low national income...
...CASE #4: G.G. Toys
1. Do you recommend that G.G. Toys change its existing cost system in the Chicago plant? In the Springfield plant? Why or why not?
G.G. Toys should change its existing cost accounting system from traditional costing to activity-based costing (ABC) in the Chicago plant as it is allocating its entire manufacturing overhead on the basis of just one cost driver: production run direct labor cost.
Since overhead at the Chicago plant is high, accurate cost accounting system is required. Different types of dolls require different amounts of machine hours, setups, production runs, shipments, etc. By using ABC, different manufacturing overhead would be allocated to each type of doll, giving result to different contribution margins.
The current costing system is good for Springfield plant as it manufactures just one product: cradles.
2. Calculate the cost of a Geoffrey doll, the specialty-branded doll #106, and a cradle using the cost study conclusions.
Actual unit cost for Geoffrey doll = $15.21
Actual unit cost for speciality-branded doll #106 = $35.10
Actual unit cost for cradle = $23.72 (no change)
(Calculations for these cost is shown on the next page)
3. Compare and contrast the profitability of each doll under the new and old systems. Based on your recomputed product costs, what actions would you recommend the company consider to enhance its profitability? What additional...
...1. Grand and Toys strategy is to achieve sales of one billion Canadian dollars, maintain a strong brand to be the clear leader in the Canadian commercial segment and to operate about 85 commercially focused stores clustered in major markets. Grand & Toy also wants to achieve their marketing objectives by offering 8000 products through 90 locations and web ordering system. Performance objectives against the strategic plan to achieve its vision included:
• Growing sales
• Reducing costs and increasing productivity
• Increasing organizational capability and capacity
• Ensuring a strong strategic position
Ecommerce is an important part of this as well they expected to direct 50 percent of its orders through its site within three years. By using one platform for all its customer needs this would translate into:
• One point of entry for customers
• Online customer segmentation through user identification
• Integration with other stakeholders
• Customers ordering from multiple channels
• New features including credit purchasing, account automation, etc.
2. Increasing number of global competitors in Canada is reducing their market share in office product industry. Competitors use better information technology to increase sales. Customized service and products are becoming very important for business and customers. Competitors use more distribution channels and better technology to support their sales in Canada and in other countries....