ACC202 MOD3CS

ACC202 - I will pay 100 dollars if you can get these back to me before 30 December 2010. Kindly separate each of the 3 assignments as such: 3CS – 2 pages, 4CS – 2 pages, and 5CS 2- page. Page limit is presented below and they need to be full pages minimum. 6 pages all together minimum excluding the cover page and reference page. Courier 12 PT Font. Kindly confirm acceptance as soon as possible. Thank you. Please see attached.

3CS

The Smell of Success

The Lovely Scent Perfume Company has recently suffered record losses.  Fredrick Fragrance, the CEO, has asked four of his top executives to recommend a strategy to put the company back on a profitable track.

Wally Workshard, the Executive Vice President, suggested that the company drop its price by 20% and predicts that this will increase sales by 85,000 units per year.

Lester Ledger, the Chief Financial Officer, suggested that the company repackage the product in designer bottles.  This would add $4.75 per unit to the production cost and fixed production costs would be increased by $40,000 per year.  Lester predicts this would increase annual sales volume by 32%.

Buster Bumble, the Production Manager, suggested that the company reduce the size of the standard bottle by 10%.  This would save $2.65 per unit in variable production costs.  He predicts sales volume would drop by only 4,500 units per year.

Gaylord Goodspeak, the Marketing Manager, suggested that the company increase its marketing budget by 66% - this would add $527,000 per year to fixed operating expenses.  In addition, he recommend raising the price by $4.90 per unit.  He predicts that the combined impact would be a 17% increase in annual sales volume.

Case assignment expectations:

Use the appended spreadsheet to evaluate each of these proposals independently. You will need to fill in the inputs based on the numbers above.  The spreadsheet will then do the remaining calculations.

Utilize the spread sheet at this URL. Copy and past to your web browser:

http://cdad.tuiu.edu/Uploads/Presentations/171Lovely%20Scent.xls

LENGTH: 2 pages typed and double-spaced:

The following items will be assessed in particular:

1. Your recommendation of the best strategy for Mr. Fragrance.

2. The support of your answer with relevant numbers and arguments. 

4CS

BFBS, LLC.

Denys C. began a manufacturing organzation, BFBS, LLC., in 2003.  The firm specializes in natural hair care products. Most clients are mid-sized national and international retailers who have highly developed in-house marketing departments.

BFBS has proved to be highly successful in the past primarily because of the strong personal attention given to the clients by the project managers.  Since inception, BFBS has expanded into four regional segments; North/South America, Europe, and Asia.  The home office is in North America. 

However, in the current year losses have been incurred. Each office is headed by an office manager who is responsible for all activities in that office.  The managers are paid a reasonable salaries plus a bonus with two inputs.  The first input is the net income of the manager's office and the second is the sharing of a portion of the overall company profits.  Managers have a high level of independence to make decisions and are held accountable for the results.

Each office is allocated a portion of the non-traceable fixed costs of the organization that are common to all offices. 

The current year's segmented operating results are shown in this excel spreadsheet. Copy and paste to your web browser:

http://cdad.tuiu.edu/Uploads/Presentations/20006Module%204%20CASE%20excel%20sheet%20background.xls

Case assignment expectations:

Review the information from the modular background. Use the appended spreadsheet to evaluate this organization. You will need to fill in the inputs based on the numbers.  The spreadsheet should be used to do the calculations.

LENGTH: 2-3 pages typed and double-spaced:

The following items will be assessed in particular:

Note: Cost of Goods sold and Transportation Expenses are both variable; all other costs are fixed.

1. Discuss the advantages and disadvantages of the format present in the excel spreadsheet Responsibility Segmentation Analysis.

2. Explain the allocation method used to distribute corporate expense. Is this an effective allocation method? Why or Why not?

3. Construct a contribution statement showing each segment using the information from the spreadsheet. Include percentages in a separate column for common size analysis purposes. Also, add a total corporation column showing percentages in a common size analysis format.

4. As the CFO (Chief Financial Officer) of BFBS what suggestions would you make to Denys C. and management to improve the performance of the organization. 

5CS

Pecos Printers, Inc. Pecos Printers, Inc. is a small manufacturing firm in Houston, Texas that manufactures color ink jet printers for the small business market.  It has just launched the PP 7500.  A 50% markup is standard in this industry so that Pecos must sell to distributors below $400 per printer to keep the retail price below the industry top of $600 ($400 * 150% = $600).  Paul Pecos, the founder and CEO of Pecos Printers, wants to keep the price to distributors as low as possible so he has carefully engineered his manufacturing process to be as efficient as possible. The model PP 7500 is an exceptionally desirable model with the following features: · A monthly capacity of 10,000 copies · A print speed of 10 copies per minute for black and white and 5 copies per minute for color. · A lifetime capacity of 120,000 copies. · The ability to accept readily available HP ink cartridges. Lester Ledger, the Pecos Controller has developed the following cost sheet for the model 7500: Cost Category Cost per Unit Direct Materials (Variable) $145 Direct Labor (Variable)     60 Overhead (Variable)     40 Overhead (Fixed)*     45 Total Unit Costs $290 *This is determined on a per unit basis as followed.   Lester assumes that the annual fixed overhead costs for this product will be $450,000 and that approximately 10,000 Model 7500's will be produced during the current year.  Pecos has the capacity to produce 20,000 units per year without increasing fixed costs. Paul has determined that approximately 20% of the total manufacturing costs are necessary for a decent profit.  Based on these data, Paul has developed the following pricing rule for his sales staff:  Accept any offer from distributors of $300 or more and reject any offer below $300. The sales staff is on salary with no commission paid for any sale.  The salesmen negotiate with distributors who make firm offers which the Pecos salesmen then either accept or reject.  Last month the three salesmen reported the following offers and results:   Offer (per unit) Number of Units Accepted? Sam Smoothtalk         Offer No. 1 $310 200 Yes   Offer No. 2 $305 150 Yes   Offer No. 3 $295 300 No Harry Hustler         Offer No. 1 $305 50 Yes   Offer No. 2 $200 250 No   Offer No. 3 $300 100 Yes   Offer No. 4 $330 75 Yes Gary Giftofgab         Offer No. 1 $305 250 Yes   Offer No. 2 $245 400 No   Offer No. 3 $325 100 Yes In addition, Ms. Glenda Goodperson, the office assistant manager received an offer from a new distributor for 700 units at $290.  She felt this would be advantageous for Pecos and accepted the offer.   When Paul Pecos found out about this transaction, he was furious that Ms. Goodperson had violated his decision rule and fired her on the spot.  He then cancelled the order with the new distributor. Overall, Paul was satisfied with the month's sales results.  His sales staff had sold 925 units which translated to an annual rate of over 11,000 units.  This was 10% above his estimate of 10,000 annual sales. Case assignment expectations: Review the information from the modular background and the case infomation above. Evaluate Paul Pecos' decision rule. Evaluate Paul Pecos' reaction to Ms. Goodperson's sale. LENGTH: 2 pages typed and double-spaced: The following items will be assessed in particular: 1. Prepare a contribution margin income statement for the month with two columns:  in the first column, show the results following Paul's decision rule.  In the second column, show what the results would have been if you chose to revise the decision rule and your revised decision rule had been followed.  For simplicity sake, ignore non-manufacturing costs and taxes. 2. Do you have any other recommendations for Paul to improve his operations?