1(d).Value Chain Analysis: A Way to profit improvement & cost Reduction Learning Objective 1. how to identify the value added activity 2. how to rectify the non –value added activity 3. application in profit planning & cost reduction INTRODUCTION Competitive advantage for a company means not just matching or surpassing their competitors, discovering what the customers want and then profitably satisfying, and even exceeding
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The University of the West Indies, St. Augustine Faculty of Social Sciences Department of Management Studies M.Sc. Aviation Management AVMT 6001 – Accounting for Business Decisions AVMT 6001 – Group Project 2 Managerial Accounting - JetBlue Airways Corporation Group Members: Cherrish Bridgemohan - 807001633 Rajiv Debie - 04708006 Israel Duncan - 814004144 Kenrick Duncan - 814002425 Neil Shepherd - 814004177 Signatures: Cherrish Bridgemohan ___________________________ Rajiv Debie Israel Duncan
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with the supplier’s price, and works to determine the selling price of the buying organization’s end product or service. b. starts with the selling price of an organization’s end product minus the operating profit to establish the target cost. c. starts with the selling price of an organization’s end product minus actual manufacturing, overhead, and materials costs to determine operating profit. d. starts with the supplier’s price, and works to determine the supplier’s true cost structure. e. starts
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CHAPTER 7: COST-VOLUME-PROFIT ANALYSIS QUESTIONS 7-1 The underlying relationship in cost-volume-profit analysis is that costs, revenues, and profits all change in a predictable way as the volume of activity changes. 7-2 It is more practical to find the breakeven point in sales dollars for companies having thousands of individual items. Finding the breakeven point for each item would be laborious and meaningless. 7-3 The contribution margin ratio is: price - variable costs
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must operate in order to break-even. During the meeting, French was challenged and questioned because his presentation failed to consider some aspects of the company’s operation such plans for expansion in sales and production, the product mix and prices on individual product basis since he was only using “averaging”. This is because of his following assumption: • He has assumed that there is just one breakeven point for the firm (by taking the average of the 3 products). • He has also assumed that
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CAMBRIDGE SOFTWARE CORPORATION: QUANTITATIVE ANALYSIS Learning Objectives: Benefits of product variety Factors limiting product variety Strategic considerations in product-line pricing III. Quantitative Analysis: We will first consider the product-line design and pricing decisions for the case when CSC can offer only one version. In this case, the product-line design only involves selecting the “right” version to offer. Note further that targeting/positioning decision is synonymous
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THE COST OF QUALITY (Recent Concept) 1. CONSEQUENCES OF FAILURE TO MEET CUSTOMER (I & E) REQUIREMENTS ← Replacements ← Rectification – Reworks. ← Warranties Payments. ← Recall. ← Results in Loss of Money. 2. WHY HAS COSTS OF QUALITY CONCEPT NEGLECTED ← Lack of effective cost control system. ← Reluctance to change existing financial control systems. ← Most office and manufacturing
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3 Industry Analysis: The Fundamentals When a management with a reputation for brilliance tackles a business with a reputation for poor fundamental economics, it is the reputation of the business that remains intact. —Warren Buffett, Chairman, Berkshire Hathaway The reinsurance business has the defect of being too attractive-looking to new entrants for its own good and will therefore always tend to be the opposite of, say, the old business of gathering and rendering dead horses that always tended
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M4 – MEMBA F15 – Curled Metals Inc. Adolfo Rogel Gabriel Sánchez Gerardo Cabada Problem Identification and Situation Analysis Problem Definition and Objectives Curled Metal Inc. - Engineered Products Division (CMI), Company had grown from selling metal as a finished product to one that used it as a raw material, with sales increase from $750,000 usd in 1991 to over $55 million usd by 2007. To date, CMI strongly relies on Slip-Seal, used as a high-temperature product seal in cars.
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proportion of overheads, Wilkerson should abandon its existing cost system and move to activity-based costing. The profitability analysis indicates that the company earns healthy margins on pumps and valves. However, the margin of flow controllers at actual usage of capacity is negative. Wilkerson should consider action targeted at cost reduction (changes in flow controllers design or in their production and delivery process) or raising the price of flow controllers for customers. Since flow controllers
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