Free Essay

Kim Fuller Case

In: Business and Management

Submitted By mariesantos
Words 630
Pages 3
First Page and the Assignment Questions:
In early fall, Kim Fuller was employed as a district sales engineer for a large chemical firm. During a routine discussion with plant chemists,
She learned that the company had developed a use for the recycled material, in pulverized form, made from plastic soda pop bottles.
Because the state had mandatory deposits on all beverage bottles, Ms.
Fuller realized that a ready supply of this material was available. All that was needed was an organization to tap that bottle supply, grind the bottles, and deliver the pulverized plastic to the chemical company.
It was an opportunity Ms. Fuller had long awaited—a chance to start a business. In November, she began checking into the costs involved in setting up a plastic bottle grinding business. She acquired a used truck and three trailers to pick up the empty bottles. She purchased one used grinding machine but had to buy a second one new. She also purchased supplies and parts necessary to run and maintain the machines.
Finally, she purchased a personal computer with the intention of using it to keep company records. These items used $65,000 of the $75,000
Ms. Fuller had saved and invested in the company.
She found a warehouse costing $162,000 in an excellent location for the business, and was able to interest family members enough in this project that three of them, two sisters and a brother, invested $30,000 each. These funds gave Ms. Fuller the $50,000 down payment on the warehouse. The bank approved a mortgage for the balance on the building. In granting the mortgage, however, the bank official suggested that Ms. Fuller start from the beginning with proper accounting records. He said these records would help not only with future bank dealings but also with tax returns and general management of the company. He suggested that she find a good accountant to provide assistance from the start, to get things going on the right foot.
Ms. Fuller’s neighbor, Marion Zimmer, was an accountant with a local firm. When they sat down to talk about the new business, Ms. Fuller explained that she new little about keeping proper records. Ms.
Zimmer then suggested that she buy an "off-the-shelf” accounting system software package from a local office supply retailer. Ms.
Zimmer promised to help her select and install the package as well as learn how to use it.
To select the right package for Ms. Fuller’s needs, Ms. Zimmer asked her to list all of the items purchased for the business, all of the debts incurred, and the information she would need to manage the business.

Ms. Zimmer explained that not all this information would be captured by accounting records and displayed in financial statements. She promised to create files to accommodate accounting and nonaccounting data once Ms. Fuller had given her some more information.
...
Assignment
1. What information will Ms. Fuller need to manage the business?
Classify this information in two categories: accounting information and non-accounting information.
2. See what you can do to draw up a beginning of business list of the assets and liabilities of Ms. Fuller’s company making any assumptions you consider useful. How should she go about putting a value on the company’s assets? Using your values, what is the company’s opening owners’ equity?
3. Now that Ms. Fuller has started to make sales, what information is needed to determine “profit and loss"? What should be the general construction of a profit and loss analysis for Ms. Fuller’s business? How frequently should she do such an analysis?
4. What other kinds of changes in assets, liabilities, and owners’ claims will need careful recording and reporting if Ms. Fuller is to keep in control of the business?

Similar Documents

Premium Essay

Kim Fuller Case 1-2

...Case 1-2 & 2-3 Anthony Case 1-2 & Anthony Case 2-3 Anthony Case 1-2: Kim Fuller 1. In order for Kim Fuller’s plastic bottle grinding business to get off the ground she will need to manage the business with non-accounting and accounting information. The following information to run the business is non-accounting information, as it is not owned by the company did not occur through a monetary transaction: 2 grind machine workers, 1 truck drive, 1 accountant, and the 2 contracts with bottling companies. The remaining information is categorized as accounting information, as it is owned by the company, may provide future economic resource, and occurred through a transaction: 1 used truck, 2 trailers, 1 used grinding machine, 1 new grinding machine, 1 new computer, 1 warehouse, 3 investors’ deposits, 1 mortgage loan, and the owner’s initial investment into the company. 2. Below is the beginning balance sheet for Kim Fuller’s Business. a.) [pic]b.) To address the question of how Fuller should go about putting a value on the company’s assets, she must utilize the generally accepted accounting principles (GAAP) regarding the worth of her assets. Specifically through these principles, Fuller will be able to determine the fair value or cost of each asset – as a transaction occurred for each purchased item of equipment. Additionally, she will be able to add the value of the Warehouse based on the value at the time of her purchase. Through......

Words: 332 - Pages: 2

Premium Essay

Mr Rahman

...Case 1-2 Kim Fuller By ganes23 | November 2011 * Zoom In * Zoom Out Page 1 of 2 CASE 1-2 KIM FULLER* - BOTTLE GRINDING COMPANY Question 1 Accounting informationNon-Accounting Information 1) Used truck1) Grind machine workers 2) Truck drive2) Accountant assistances - Zimmer 3) Trailers$ 65,0003) Contracts with bottling companies 4) Grinding machine4) Truck Driver 5) Personnel computer5) Accounting Software Package 6) Warehouse$ 162,000 7) Sibling’s Investment$ 90,000 8) Mortgage loan$ 112,000 9) Filler’s Savings$ 75,000 Question 2 AssetsLiabilities Cash* $ 50,000Mortgage*$ 112,000 Equipment$ 65,000 Warehouse$ 162,000Owner’s Equity  Paid-in Capital* $ 165,000 $ 277,000$ 277,000 Note: Cash* = Fuller’s Saving + Sibling’s Investment – Equipmnt Cost – Warehouse Depst = $75,000 + $90,000 - $65,000 - $50,000 = $ 50,000 Mortgage* = Warehouse cost – Warehouse Deposit  = $ 162,000 - $ 50,000  = $ 112,000 Paid-in Capital = Fuller’s saving + Sibling’s Investment  = $75,000 + $90,000 = $165,000 Question 3 Information required to do profit and loss are revenues, cash of sales, administrative expenses, operating expenses and taxation. Fuller should prepare income statement and cash flow statement to keep track of his business. The financial statements can be done quarterly since it’s a small business but as the business grows, Fuller should do it monthly basis or weekly basis to keep his business under control. Question 4 Fuller......

Words: 285 - Pages: 2

Premium Essay

Kim Fuller

...and inventory. Fuller will also need to know what customer owe the business through Accounts receivables. Financial Accounting- This type of information is geared more for managers and also for external parties such as shareholders (in Fuller’s case, her siblings), the bank and other creditors. The amount of liabilities she has in the form of Accounts payable and loan payable, bank reconciliations, the cost of the assets in the plant and equipment owed by the business, the amount of the mortgage payable and record of owners’ equity would fall under financial accounting. Management Accounting- This type of information is a summary of planning, budget, implementation and control. These types of reports would be generated for internal use for managers to use the data for their specific department and help run the business overall. Tax Accounting- This type of information focuses on tax issues where a business has elected to use different accounting rules for tax accounting and financial accounting. Fuller would be accountable to keep accurate records to tax filing purposes. Types of non-accounting information beneficial for the company could include: how fast the grinding machines per hour, the number of raw material bottles needed to produce an amount of finished material, number of deliveries per week of raw material, the number of machines on the shop floor, contracts with the local businesses, number of employees on a given shift. 2. The assets for Kim Fuller’s...

Words: 761 - Pages: 4

Premium Essay

Case Analysis on Private Fitness

...Case 15-1: Private Fitness LLC* Private Fitness LLC is a springboard case that can be used as the basis of a discussion of management's need for information. It serves the same purpose for Part 2 of the book that the Kim Fuller case did for Part 1. Approach This case uses a small business as its setting so that students can visualize the business's activities, and so questions of generally accepted accounting principles will be essentially irrelevant. In fact, a shift the student needs to make as he/she begins Part 2 of the book is to think of accounting primarily in terms of its usefulness to a company's management, rather than in terms of reporting to shareholders and other outside parties. Because of the differing focus of Part 1 of the book, particularly the later chapters, some students will forget that they are dealing here with information for an apparently unsophisticated manager to help her run a small business, and not data for a NYSE company. This case is compelling both because students understand the business—fitness-training—and because there is a real problem to discuss. A trusted employee was both stealing cash and, by not recording all sales, diverting some revenues to herself. Discussion of this simple case helps students think about both the records needed to run the business and the challenges managers face in making sure the information put into the records is recorded accurately (i.e., the challenges faced in maintaining an effective......

Words: 333 - Pages: 2

Free Essay

Concept Analysis Competency

...Competency: Analysis of the Concept Michelle Trigg University of South Alabama Abstract Understanding the nature and meaning of nursing competency is the initial step in having an unambiguous definition of its practice. All healthcare professionals, including nurses, may only prove to be proficient in their capabilities if they are able to perform comprehensive assessments related to the provision and maintenance of safe and efficient care, the protection of all members of the general public, and the undertaking of all necessary actions in order to preserve the nursing profession. Any and all standards that are established, based on such a perspective, must be adhered to in practice and for the purpose of nursing evaluation. This paper will evaluate and explore the concept of competency and the ways in which the nursing profession integrates the many aspects of competency. Keywords: competence, competency, concept analysis Competency: Analysis of the Concept The concept of competency in nursing is a professional regulation and is extremely important to patient safety and outcomes. In the past, competency in nursing focused on evaluating clinical skills, and not the actual ability(ies) or comprehension of the science behind them (Allen et al., 2008). Nurse competency is a requirement in the clinical setting, and outlines the......

Words: 3007 - Pages: 13

Premium Essay

Facebook Case Study

...FB, demography and personality of FB users, and suggested a dual-factor model of FB use. In accordance with the model, FB users are motivated by two essential needs: (1) the need to belong and (2) the need for self-presentation. The need to belong can be referred as the innate drive to have a relationship with others and gain social acceptance, and the need for self-presentation as an impression management in which people attempt to influence the perception of their image. These two factors can work as a pair or singly for FB use. For example, the number of FB friends and a desirable presentation of self on FB positively associate with the degree of subjective well being and users’ self-esteem because of visualization of social networking (Kim & Lee, 2011). FB enables users to create own profiles including name, gender, date of birth, e-mail address, home town, personal interests, job information and photograph (Facebook, 2016). The interactions on FB are the friends list, the wall, pokes, status, events, photos, video, messages, chat, groups and like. The friends list is a significant part of FB, because it enables the endusers to create a public display of their accounts which viewers can click to expand the network. Like allows users to give positive feedback about preferred content (Facebook, 2016). People use these functions to build relationships, gain acceptance and present self so that they can satisfy the need to belong and the need for self-presentation. 2. Using......

Words: 1345 - Pages: 6

Premium Essay

Private Fitness Llc

...Case 15-1: Private Fitness LLC* Private Fitness LLC is a springboard case that can be used as the basis of a discussion of management's need for information. It serves the same purpose for Part 2 of the book that the Kim Fuller case did for Part 1. Approach This case uses a small business as its setting so that students can visualize the business's activities, and so questions of generally accepted accounting principles will be essentially irrelevant. In fact, a shift the student needs to make as he/she begins Part 2 of the book is to think of accounting primarily in terms of its usefulness to a company's management, rather than in terms of reporting to shareholders and other outside parties. Because of the differing focus of Part 1 of the book, particularly the later chapters, some students will forget that they are dealing here with information for an apparently unsophisticated manager to help her run a small business, and not data for a NYSE company. This case is compelling both because students understand the business—fitness-training—and because there is a real problem to discuss. A trusted employee was both stealing cash and, by not recording all sales, diverting some revenues to herself. Discussion of this simple case helps students think about both the records needed to run the business and the challenges managers face in making sure the information put into the records is recorded accurately (i.e., the challenges faced in maintaining an effective internal......

Words: 1074 - Pages: 5

Premium Essay

Strategy

...Table of Contents Introduction 2 Part 1: External Analysis 3 1.1 Macro-Environment Analysis 3 1.2 Industry Analysis 4 Porter’s Five Forces of Competition Analysis of Netflix 4 1.2 Opportunities and threats (Partial SWOT) 5 Part 2: Internal Analysis 6 2.1 Value Chain Model 6 2.2 Competencies Framework 7 2.3 VRIO Framework 8 2.4 Strengths and Weaknesses (partial SWOT) 9 Part 3: Netflix Issues and Challenges……………………………………………………………………………………………..10 Part 4: The selection of strategic options 11 4.1 Strategy Clock model and the Porter’s Generic Strategy Model 11 4.2 Strategic Options 12 Part 5 – Conclusions 14 References 15 Appendix 17   Introduction Netflix, set up in 2000, is a television show and movie rental Company. It slowly became a leader in this field by offering DVD-by-mail and online video streaming services. It provides a subscription based model. According to this model the customers utilize the products and services of Netflix through a monthly fee rather than a pay as you use rate. Netflix has been expanding its reach of providing services to other geographies with its two service lines to places like the UK, Ireland, Canada, Latin America and the Caribbean. Among the Porter’s generic strategies, Netflix has adapted the Differentiation/Cost Leadership strategy as their target customer base is broad and they also provided to renters a low cost alternative to the otherwise traditional video rental stores. The major stakeholders of Netflix......

Words: 2505 - Pages: 11

Premium Essay

Globalstrategy and Multinationals' Entry Mode Choice

...GLOBAL STRATEGYAND MULTINATIONALS' ENTRY MODE CHOICE W. Chan Kim* INSEAD Peter Hwang** Baruch College Abstract. This paper makes a case directed towards establishing the importance of global strategic considerations in choosing multinationals'entry mode. Specifically,it is our contention that beyond the environmental and transaction-specificfactors well established in the literature to affect the entry mode decision, we should also consider the strategicrelationshipa multinational envisages between its operations across borders in reaching this decision. After incorporating various global strategic variables into an eclecticframeworkof the factorsinfluencing entrymode the choice, this paper tests both the validityof the overall framework and the importance of each entry mode determinant in differentiating among entry modes. This is done based on ninety-six multinational managers' responses to a survey questionnaire concerning their entry mode decision experiences. The results suggest that an express incorporationof global strategicvariables into an analysis of the entry mode decision is warranted. This paper is concerned with the critical decision of multinationals' foreign entry mode choice. While existing studies have already identified a diversity of variables that influence this decision, in our view these variables can or essentiallybe collapsedinto one of two categories:environmental ftansactionspecific factors. Common to existing studies identifying these factors is......

Words: 3800 - Pages: 16

Premium Essay

Exchange Rate Random Walk Model

...Forecasting the USD/COP Exchange Rate: A Random Walk with a Variable Drift Peter Rowland Banco de la República* Abstract This study develops three exchange rate models as well as a simple statistical model defined as a random walk with a variable drift. The exchange rate models all use the purchasing power parity hypothesis to account for the long-term relationships between prices and the exchange rate, together with error correction models to represent any shortterm dynamics. The models are estimated for the USD/COP rate of exchange, and their forecast performance is compared to that of a simple random walk as well as to that of the random walk with a variable drift term. Two of the models are shown to outperform the simple random walk on the 12 and 24-months forecasting horizon. However, all the models are outperformed by the random walk with a variable drift, where the drift term is estimated using a Kalman filter. The results suggest that fundamental models might only be a useful tool for forecasting of the exchange rate in the very long run. The opinions expressed here are those of the author and not necessarily of the Banco de la República, the Colombian Central Bank, nor of its Board of Directors. I express my thanks to Luis Eduardo Arango, Javier Gómez, and Luis Fernando Melo for helpful comments and suggestions. Any remaining errors are my own. * Contents 1 2 2.1 2.2 2.3 2.4 2.5 2.6 3 3.1 3.2 3.3 3.4 3.5 3.6 4 4.1 4.2 4.3 5 Introduction Exchange Rate......

Words: 13917 - Pages: 56

Premium Essay

Fragility in Global Supply Chains

...spare" or even "just in arrangement" generation with insignificant procedure inventories. Numerous organizations have changed from "nearby" suppliers to "ease" (and regularly far off) suppliers on the premise of expense, without considering the full cost of risks connected with these progressions. Accordingly, the expanded supply chain now has numerous extra purposes of potential disappointment, recommending that new methodologies to risk administration can be useful. Numerous organizations face expanded exposures and possibly immoderate fragility lead times for basic items if unforeseen occasions rise, as they apparently will. This paper gets aimed at identification of how fragility in logistics will lead to increased risk in supply chains (Kim,...

Words: 3893 - Pages: 16

Premium Essay

Who Regulation

...SYMPOSIUM: The 2007 Revised World Health Organization (WHO) Classification of Tumours of the Central Nervous System: Newly Codified Entities DOI 10.1111/j.1750-3639.2007.00082.x Newly Codified Glial Neoplasms of the 2007 WHO Classification of Tumours of the Central Nervous System: Angiocentric Glioma, Pilomyxoid Astrocytoma and Pituicytoma Daniel J. Brat, MD, PhD1; Bernd W. Scheithauer, MD2; Gregory N. Fuller, MD, PhD3; Tarik Tihan, MD, PhD4 Department of Pathology and Laboratory Medicine, Emory University School of Medicine, Atlanta, Ga. Department of Pathology and Laboratory Medicine, Mayo Clinic, Rochester, Minn. 3 Department of Pathology, The University of Texas M. D. anderson Cancer Center, Houston, Tex. 4 Department of Pathology, Neuropathology Unit, The University of California at San Francisco, San Francisco, Calif. 2 1 Corresponding author: Tarik Tihan, MD, UCSF, Department of Pathology, Neuropathology Unit, M 551, 505 Parnassus Avenue, San Francisco, CA 94143-0102 (E-mail: tarik.tihan@ucsf.edu) The 4th edition of the WHO Classification of Tumours of the Nervous System (WHO 2007) introduces changes that reflect both the recognition of new brain tumour types and a better understanding of neoplastic behavior. Three new tumours, angiocentric glioma (AG), pilomyxoid astrocytoma (PMA), and pituicytoma are added to the section on gliomas. AG is a slowly growing cerebral tumour that typically presents with seizures in children and young adults. It is characterized......

Words: 4680 - Pages: 19

Premium Essay

Relationship Between Exchange Rate and Inflation

...The Relationship Between Exchange Rate and Inflation in Pakistanby Shagufta KashifAbstractThere has been a long-standing interest in studying the factors that are responsible for uneven vacillation in the stable growth of the world economies. Lots and lots of theoretical literature and empirical evidences have addresses this issue in the past. Hike in prices of goods and services and foreign exchange are two important aspects which are deemed responsible for such potholed fluctuations in the economic growthThe volatility of the nature of prices is a major source of concern in all countries since 1970s. The issue is of a more serious nature in the developing countries where inflation in foreign countries known as “imported inflation” is seen to be driving “local/domestic inflation”; making domestic policies to control inflation ineffective. Similarly, in Pakistan, the domestic price level rose from the mid-1970s. The exchange rate started depreciating continuously from the early 1980s. Continuous devaluation of currency and inflation in the 1980s seems to suggest a correlation between the two variables.The studies by Rana and Dowling (1983) suggest that foreign inflation is the most influencing factor in explaining the change in local price level in nine less-developed countries of Asia during the period 1973-79. This study suggests that these countries cannot exercise much control over domestic inflation, however, the policies of their major trading partners (through exchange...

Words: 5793 - Pages: 24

Premium Essay

Managing Justly Across Cultures

...www.sciedu.ca/jms Journal of Management and Strategy Vol. 1, No. 1; December 2010 Managing Justly Across Cultures: The Problem of Fairness in International Business Rolf D. Dixon (Corresponding author) Weber State University 3802 University Circle, Ogden, Utah 84408, USA Tel: +1-(801)-626-7542 E-mail: rddixon@weber.edu Cam Caldwell University of Georgia G-2 Brooks Hall, Athens, GA 30602-6256, USA Tel: +1-(318)-446-0129 E-mail: camcaldw@uga.edu Apichai Chatchutimakorn College of Business, McNeese State University Kayla Gradney College of Business, McNeese State University Kochakan Rattanametangkul McNeese State University katekochakan@yahoo.com Received: September 14, 2010 Abstract The aim of this paper is to examine the relationships between organizational justice and the factors that characterize cultural differences. This paper begins by briefly summarizing the nature of organizational justice and by identifying how justice is perceived. Hofstede’s five factors of cultural dimension model, which he developed in his seminal 1980 research on national cultures, is utilized to present characteristics of cultural differences. Ten propositions are then offered which relate to organizational justice and differences in cultural perspectives. These propositions suggest specific management approaches that organizational leaders can adopt to be more effective in dealing with employees from respective cultures. This paper concludes by identifying the importance of......

Words: 7281 - Pages: 30

Premium Essay

Michael Porter's Marketing Theory

...Michael Porter has described a category scheme consisting of three general types of strategies that are commonly used by businesses to achieve and maintain competitive advantage. These three generic strategies are defined along two dimensions: strategic scope and strategic strength. Strategic scope is a demand-side dimension (Michael E. Porter was originally an engineer, then an economist before he specialized in strategy) and looks at the size and composition of the market you intend to target. Strategic strength is a supply-side dimension and looks at the strength or core competency of the firm. In particular he identified two competencies that he felt were most important: product differentiation and product cost (efficiency). He originally ranked each of the three dimensions (level of differentiation, relative product cost, and scope of target market) as either low, medium, or high, and juxtaposed them in a three dimensional matrix. That is, the category scheme was displayed as a 3 by 3 by 3 cube. But most of the 27 combinations were not viable. In his 1980 classic Competitive Strategy: Techniques for Analysing Industries and Competitors, Porter simplifies the scheme by reducing it down to the three best strategies. They are cost leadership, differentiation, and market segmentation (or focus). Market segmentation is narrow in scope while both cost leadership and differentiation are relatively broad in market scope. Empirical research on the profit impact of marketing......

Words: 2130 - Pages: 9