Business
Jomana_2007
RubricandworksheetforHappyChipsCase9_4thed_web_125.docxPerformance Control at Happy Chips, Inc.
Management Case Rubric AND Worksheet
Case 9, pp. 462-464
(Answer only questions 1-2 combo, 4 & 5)
Point breakdown
Content 120/120
G/S (grammar, spelling, questions) 5/5
Total 125/125
General Requirements:
a. There are 125 points per case
b. One hundred twenty points will be divided equally among the questions (e.g., 4 questions @ 30 points each, 3 questions @ 40 points each, etc.)
c. Five points will be based upon correct use of grammar, spelling, neatness, and inclusion of the case question.
d. Full credit will be given if you meet the following requirements:
· Your answer addresses the questions directly
· Your answer addresses all parts of a multiple-part question
· Your answer includes terms and concepts from the text
· Your answer includes examples from the case
e. Please see the rubric for each management case for specific question requirements
PLEASE FOLLOW THE FORMATTING INSTRUCTIONS CITED IN THE QUESTION RUBRIC OR YOU WILL AUTOMATICALLY LOSE 10 POINTS!!!!
THANKS!!!!!!!
Ignore Table 1 on p. 463
Fill in the shaded blanks for this Happy Chips, INC., Segment Profitability Report
|
Retail Accounts: |
Grocery |
Drug |
Mass Merchandise |
|
Unit Sales |
3,000,000 |
450,000 |
500,000 |
|
Trade Price |
$2.30 |
$2.10 |
$1.50 |
|
Revenue |
$6,900,000 |
|
|
|
|
|
|
|
|
COGS/unit |
$1.26 |
$1.26 |
$1.26 |
|
Unit Sales/segment |
3,000,000 |
450,000 |
500,000 |
|
Labeling Cost |
n/a |
n/a |
$ * |
|
COGS/segment |
$3,780,000 |
$ |
$ |
|
|
|
|
|
|
Net Margin |
$3,120,000 |
$ |
$ |
|
|
|
|
|
|
Controllable Fixed Costs |
|
|
|
|
Stocking Cost |
$520,000 |
$ ** |
$ ** |
|
Delivery Cost |
$572,000 |
$ ** |
$ ** |
|
Total Controllable Fixed Costs: |
$1,092,000 |
$ |
$ |
|
|
|
|
|
|
Profit/segment |
$2,028,000 |
$ |
$ |
|
|
|
|
|
*Labeling Cost: see top of p. 464 for formula.
PLEASE SHOW YOUR CALCULATION.
The table below replaces Table 2 on p. 463
|
Cost Category/Segment |
Grocery 250 loc, 2 del/wk |
Drug 140 loc, 1 del/wk |
Mass Merchandise 6 loc, 3 del/wk |
|
Stocking Cost ($/Delivery) |
$20 |
$18 |
$30 |
|
Delivery Cost ($/Delivery) |
$22 |
$22 |
$30 |
**Stocking Cost and Delivery Cost for each segment is the product of:
Cost/delivery x deliveries/week x 52 weeks x number of retail locations served
Grocery’s Stocking Cost example: $20 x 2 dels/wk x 52 wks x 250 locations = $520,000
Grocery’s Delivery Cost example: $22 x 2 dels/wk x 52 wks x 250 locations = $572,000
PLEASE SHOW CALCULATIONS FOR BOTH THE DRUG AND MASS MERCHANDISE STOCKING AND DELIVERY COSTS
WORKSHEET FOR QUESTION 1-2 CALCULATIONS
Q’s 1-2 Combo: Using relevant costs provided above (note changes!!!), determine the profitability of each of Happy Chips’ business segments. Based on your analysis, should Happy Chips consider the changes desired by Buy 4 Less? Why or why not?
|
Q |
Full Credit 55 points |
75% Credit 44 points |
50% Credit 27 points |
25% Credit 13 points |
|
1.
|
A) Complete accurately the above segment profitability report (15 shaded areas AND calculations for MM Labeling AND Drug and MM Stocking and Delivery Costs: 5 total)
B) Explain why or why not Happy Chips should consider the changes desired by Buy 4 Less. Use the findings from the financial report above AND 1-2 sentences commenting on the changes requested by Buy 4 Less.
|
A) Complete accurately the above segment profitability report (12/15 shaded areas AND calculations for MM Labeling AND Drug and MM Stocking and Delivery Costs: 5 total)
B) Explain why or why not Happy Chips should consider the changes desired by Buy 4 Less. Use the findings from the financial report above AND 1-2 sentences commenting on the changes requested by Buy 4 Less.
|
A) Complete accurately the above segment profitability report (8/15 shaded areas AND calculations for MM Labeling AND Drug and MM Stocking and Delivery Costs: 5 total)
B) Explain why or why not Happy Chips should consider the changes desired by Buy 4 Less. Use the findings from the financial report above AND 1-2 sentences commenting on the changes requested by Buy 4 Less.
|
A) Complete accurately the above segment profitability report (4/15 shaded areas AND calculations for MM Labeling AND Drug and MM Stocking and Delivery Costs: 5 total)
B) Explain why or why not Happy Chips should consider the changes desired by Buy 4 Less. Use the findings from the financial report above AND 1-2 sentences commenting on the changes requested by Buy 4 Less.
|
DO NOT DO QUESTION 3!!!!!
WORKSHEET FOR QUESTION FOUR
|
Retail Accounts: |
Mass Merchandise |
|
Unit Sales |
500,000 |
|
Trade Price (reflect a 30% price increase) |
$ |
|
Revenue |
$ |
|
|
|
|
COGS/unit |
$1.26 |
|
Unit Sales/segment |
500,000 |
|
Labeling Cost |
$ * |
|
COGS/segment |
$ |
|
|
|
|
Net Margin |
$275,000 |
|
|
|
|
Controllable Fixed Costs |
|
|
Stocking Cost |
$ ** |
|
Delivery Cost |
$ ** |
|
Total Controllable Fixed Costs: |
$ |
|
|
|
|
Profit/segment |
$ |
|
|
|
*Labeling Cost: see top of p. 464 for formula.
PLEASE SHOW YOUR CALCULATION.
The table below replaces Table 2 on p. 463
|
Cost Category/Segment |
Grocery 250 loc, 2 del/wk |
Drug 140 loc, 1 del/wk |
Mass Merchandise 6 loc, 3 del/wk |
|
Stocking Cost ($/Delivery) |
$20 |
$18 |
$30 |
|
Delivery Cost ($/Delivery) |
$22 |
$22 |
$30 |
**Stocking Cost and Delivery Cost for each segment is the product of:
Cost/delivery x deliveries/year x number of retail locations served
Grocery’s Stocking Cost example: $20 x 2 dels/wk x 52 wks x 250 locations = $520,000
Grocery’s Delivery Cost example: $22 x 2 dels/wk x 52 wks x 250 locations = $572,000
PLEASE SHOW CALCULATIONS FOR THE MASS MERCHANDISE STOCKING AND DELIVERY COSTS ONLY
Q4: If the price to mass merchandise stores were to increase by 30%, would that change your response to Question 1-2 combo?
|
Q |
Full Credit 25 points |
75% Credit 18 points |
50% Credit 13 points |
25% Credit 7 points |
|
4.
|
A) Complete accurately the above segment profitability report (8 shaded areas AND calculations for MM Labeling AND Drug and MM Stocking and Delivery Costs: 2total)
B) Explain why or why not you might change your answer to Q 1-2 combo. Use the findings from the financial report above AND 2 sentences indicating how you might communicate the increase in price to Buy 4 Less.
|
A) Complete accurately the above segment profitability report (6/8 shaded areas AND calculations for MM Labeling AND Drug and MM Stocking and Delivery Costs: 2total)
B) Explain why or why not you might change your answer to Q 1-2 combo. Use the findings from the financial report above AND 2 sentences indicating how you might communicate the increase in price to Buy 4 Less.
|
A) Complete accurately the above segment profitability report (4/8 shaded areas AND calculations for MM Labeling AND Drug and MM Stocking and Delivery Costs: 2total)
B) Explain why or why not you might change your answer to Q 1-2 combo. Use the findings from the financial report above AND 2 sentences indicating how you might communicate the increase in price to Buy 4 Less.
|
A) Complete accurately the above segment profitability report (2/8 shaded areas AND calculations for MM Labeling AND Drug and MM Stocking and Delivery Costs: 2total)
B) Explain why or why not you might change your answer to Q 1-2 combo. Use the findings from the financial report above AND 2 sentences indicating how you might communicate the increase in price to Buy 4 Less.
|
FACTORS FOR QUESTION FIVE
Factor 1: Selling an unprofitable product or serving an unprofitable segment promotes sales to other areas where profits can be made.
Factor 2: Refusing to serve a customer may have negative implications on other customers that Happy Chips serve.
Factor 3: It may be that third parties can provide logistics services at a lower cost.
Factor ????:
Q5: Are there factors other than segment profitability that should be considered? If so, what are they?
|
Q |
Full Credit 40 points |
75% Credit 30 points |
50% Credit 20 points |
25% Credit 10 points |
|
5.
|
A) Given the THREE factors listed above, provide TWO sentences FOR EACH factor explaining why this might happen and/or why this is important.
B) Provide ONE other factor and TWO sentences explaining why this might happen and or why this is important.
PLEASE USE BULLET-POINTS FOR EACH FACTOR EXPLANATION!
Minimum 8 sentences |
A) Given the THREE factors listed above, provide TWO sentences FOR ANY TWO factors explaining why this might happen and/or why this is important.
B) Provide ONE other factor and TWO sentences explaining why this might happen and or why this is important.
PLEASE USE BULLET-POINTS FOR EACH FACTOR EXPLANATION!
Minimum 6 sentences |
A) Given the THREE factors listed above, provide TWO sentences FOR ANY ONE factor explaining why this might happen and/or why this is important.
B) Provide ONE other factor and TWO sentences explaining why this might happen and or why this is important.
PLEASE USE BULLET-POINTS FOR EACH FACTOR EXPLANATION!
Minimum 4 sentences |
A) Given the THREE factors listed above, provide TWO sentences FOR ANY ONE factor explaining why this might happen and/or why this is important.
PLEASE USE BULLET-POINTS FOR EACH FACTOR EXPLANATION!
Minimum 2 sentences |
