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first you must study the demographies of the Oak Ridge
community then provide what is mantiond in the attachment.Â
 make sure to include all the proposal requaires 1-14 in the
attachment.
the information for the new Oak Ridge airport can be found
at flyknoxville.com Or in this linkÂ
http://flyknoxville.com/wp-
content/uploads/2015/10/ORAirportProgrammingStudyMarch20
122-1.pdf
UNIVERSITY OF WINDSOR
Odette School of Business
04-70-255 Section 30
Winter 2017
Professor Orawski
100 marks
INDIVIDUAL ASSIGNMENT
(Weighting 20%)
ASSIGNMENT DETAILS
1. Read the following five (5) problem-solving exercises and
answer the required questions. All
necessary workings should be shown. Where appropriate,
secondary sources of information used
in your report should be referenced accordingly. All solutions
must be in a MS Word format,
font 12, New Times Roman, margins of 1 inch all sides on
letter-sized paper and double-
spaced except for numerical workings which can be single-
spaced.
Question 1: What to Do?
Question 2: Pacific Air Corporation
Question 3: Hillview Gardens
Question 4: Elf’s Place Inc.
Question 5: Link’s Fine Burger’s Inc.
2. Submission deadline: April 3, 2017 at end of class.
4. Late assignments without prior consent will be penalized at
the instructor's discretion. It is the
student's responsibility to inform the instructor as soon as
possible of the circumstances regarding
a late assignment. Assignments are considered late if they are
not submitted by e-mail to
the professor by the submission date.
5. The instructor reserves the right to deduct the marks of
students who do not contribute to
group work When there is academic dishonesty of any form,
the instructor reserves the right
to assign the normal default grade· of zero on the assignment in
question. There will be no
supplementary exam or assignments for individuals who have
breached this code of conduct.
You are responsible for the contents of the assignment and
subject to the default grade. In
this course, your assignment might be submitted to electronic
verification for the detection of
plagiarism.
..
QUESTION 1 – WHAT TO DO? (19 marks)
Linda Lindeman, manager and owner of an advertising company
in Charlotte, North Carolina, had
arranged a meeting with Eric Weddle, the chief accountant of a
large, local competitor. The two
are lifelong friends. They grew up together in a small town and
attended the same university. Eric
was a competent, successful accountant but currently was
experiencing some personal financial
difficulties. The problems were created by some investments
that had turned sour, leaving him
with a $25,000 personal loan to pay off just at the time his
oldest son was scheduled to enter
college.
Linda, on the other hand was struggling to establish a successful
advertising business. She had
recently acquired the rights to open a branch of a large regional
advertising firm headquartered in
Atlanta, Georgia. During her first two years, she had managed
to build a small, profitable practice;
however, the chance to gain a significant foothold in the
Charlotte advertising community hinged
on the success of winning a bid to represent the state of North
Carolina in a major campaign to
attract new industry and tourism. The meeting she had
scheduled with Eric concerned the bid she
planned to submit.
Linda: “Eric, I'm at a critical point in my business venture. If I
can win the bid for the state’s
advertising dollars, I'll be set. Winning the bid will bring
$750,000 to $1,000,000 of revenues into
the firm. On top of that, I estimate that the publicity will bring
another $350,000 to $400,000 of
new business.”
Eric: “I understand. My boss is anxious to win that business as
well. It would mean a huge
Increase in profits for my firm. It's a competitive business,
though. As new as you are, I doubt that
you'll have much chance of winning."
Linda: "You may be wrong. You're forgetting two very
important considerations. First, I have the
backing of all the resources and talent of a regional firm.
Second, I have some political
connections. Last year, I was hired to run the publicity side of
the governor's campaign. He was
impressed with my work and would like me to have this
business. I am confident that the proposals
I submit will be very competitive. My only concern is to submit
a bid that beats your firm. If I
come in with a lower bid and good proposals, the governor can
see to it that I get the work."
Eric: "Sounds promising. If you do win, however, there will be
a lot of upset people. After all,
they are going to claim that the business should have been given
to local advertisers, not to some
out-of-state firm. Given the size of your office, you'll have to
get support from Atlanta. You could
take a lot of heat."
Linda; "True. But I am the owner of the branch office. That
fact alone should blunt most of the
criticism. Who can argue that I'm not local? Listen, with ·your
help, I think I can win this bid.
Furthermore, if I do win it, you can reap some direct benefits.
With that kind of business; I can
afford to hire an accountant, and I'll make it worthwhile for
you to transfer jobs. I can offer you
an up-front bonus of $25,000. On top of that, I'll increase your
annual salary by 20 percent. That
should solve most of your financial difficulties. After all, we
have been friends since day one and
what are friends for?"
QUESTION-1 (CONTINUED)
Eric: "Linda, my wife would be ecstatic if I were able to
improve our financial position as
Quickly as this opportunity affords. I certainly hope that you
win the bid. What kind of help can I
provide?"
Linda: "Simple. To win, all I have to do is beat the bid of your
firm. Before 1 submit my bid, I
would like you to review it. With the financial skills you have,
it should be easy for you to spot
any excessive costs that I may have included. Or perhaps I
included the wrong kind of costs. By
cutting excessive costs and eliminating costs that may not be
directly related to the project, my bid
should be competitive enough to meet or beat your firm's bid."
Required: (Please note this answer should not be more than 3
pages maximum)
a) What would you do if you were Eric? Explain the reasons for
your decision and apply the code
of ethics to the proposal given, to Eric assume that Eric is a
member of a professional accounting
body. (10 marks)
b) What is the risk to Eric personally if he reviews the bid?
Should the degree of risk influence his
decision? Explain your reasons. (9 marks)
QUESTION 2 PACIFIC AIR CORPORATION (18 marks)
Pacific Air Corporation is a business 'providing a wide variety
of aviation products to pilots
throughout the world. Dana Lombardi, the recently hired
assistant controller, has been asked to
develop a cost function to forecast shipping costs. The previous
assistant controller had forecasted
shipping department costs each year by plotting cost data
against; direct labor-hours for the most
recent 12 months and visually fitting a straight line through the
points. The results were not
satisfactory.
After discussions with the shipping department personnel,
Lombardi decided that shipping costs
could be more closely related to the number of orders filled.
She based this conclusion on the fact
that 10 months ago the shipping department added some
automated equipment. Furthermore, she
believes that using linear regression analysis will improve the
forecasts of shipping costs. Cost
data for the shipping department have been accumulated for the
last 25 weeks. She ran two
regression analysis of the data, one using direct labor-hours,
and one using the number of cartons
shipped. The information from the two linear regressions is the
following:
Regression 1 Regression 2
Equation SC = 804.3 + 15.68
DL
SC = 642.9 + 3.92 NR
R-squared 0.365 0.729
Standard error of the
estimate
2.652 1.884
QUESTION 2 (CONTINUED)
Where:
SC = Total shipping department costs
DL = Total direct labour hours
NR = Number of cartons shipped
Required:
a) Identify which regression equation (Regression 1 or
Regression 2) that Pacific Air should
adopt for forecasting total shipping department costs and
explain your reasons. (7 marks)
b) If Pacific Air estimates that 600 orders will be filled in the
coming week, calculate the total
shipping department costs using the regression that you have
selected in part (a). (3 marks)
c) Are there any limitations to the regression that you have
selected in part (a) above? If so, identify
ways to address the limitations. Include in your answer the
effect, if any, of the global nature of
Pacific Air Corporation business. (8 marks)
QUESTION 3 HILLVIEW GARDEN CARE INC. (25 marks)
Hillview Garden Care Inc. is a lawn and garden care service.
The company originally specialized
in serving small residential clients but has recently started
contracting for work on large apartment
and office building grounds. Since Phyllis Flower (owner)
believes that commercial lawn care is
more profitable she is considering dropping residential services
altogether.
Five field employees worked a total of 20,000 hours last year,
13,000 on residential jobs and 7,000
on commercial jobs. Wages amounted to $9 per hour for all
work done. Direct materials used are
included in overhead as supplies. All overhead is allocated on
the basis of labour-hours worked,
which is also the basis for customer charges. Because of the
increased competition for commercial
accounts, Phyllis can charge $22 per hour for residential work
but only $19 per hour for
commercial work.
Recently, Phyllis attended an accounting workshop on
overhead-costing and activity analysis. She
applied what she had learnt on the company. Further analysis
revealed that the overheads consist
of activities relating to transportation, equipment use and
supplies. These costs are attributed to
the following cost drivers as shown below:
QUESTION 3 (CONTINUED)
Activity Level
Activity Cost Driver Cost Commercial Residential
Transportation Number of
clients serviced
$8,000 15 45
Equipment Use Equipment
hours
$18,000 3,500 2,100
Supplies Area serviced in
square yards
$36,000 130,000 70,000
Total Overhead $62,000
Required:
a) If the overhead is $62,000, calculate the profits of
commercial and residential services using
labour as the allocation base. (7 marks)
b) Recalculate your profits for the commercial and residential
services using overhead as the cost
driver.(10 marks)
c) Based on your results for both a) and b), make
recommendations to management on what action
to take on both of these services and explain your reasons. (8
marks)
QUESTION 4 – ELF’s PLACE INC. (18 marks)
Elf’s Place Inc. (Elf’s) sells toys, games and books. A poplar
service is the birthday service, which
includes free gift wrapping and delivery of gifts to local
families. Elf’s accepts cash, cheques, Visa,
MasterCard, and American Express credit cards. These methods
of payment have the following
characteristics:
Cash Payment is immediate; no fee is charged
Cheque Payment is immediate; the bank charges $0.25 per
cheque;
and 1 percent of cheque revenue is from “bad” cheques that
Elf cannot collect
Visa/MasterCard Elf accumulates these credit card receipts
throughout the
month and submits them in one bundle for payment on the
last day of the month. The money is credited to Elf’s account
by the fifth day of the following month. A fee of 1.50 percent
is charged by the credit card company.
American
Express
Elf accumulates these credit card receipts throughout the
month and mails for payment on the last day of the month.
American Express credit’s Elf’s account by the tenth day of
the following month. A fee of 3.50 percent is charged by
American Express.
QUESTION 4 (CONTINUED)
During a typical month, the type of payment used by customers
is as follows:
American Express: 20% of sales
Visa/MasterCard: 50% of sales
Cheque: 5% of sales (average cheque is $37.50)
Cash: 25% of sales
Required:
If Elf’s estimates sales of $30,000 in April and $60,000 in May,
what are his planned net cash
receipts for May? Show your workings. (18 marks)
QUESTION 5 LINK’S FINE BURGERS INC. (20 marks)
Link’s Fine Burgers Inc. (Link’s), is a new company currently
studying various alternatives in
regard to opening burger outlets. The only available data was
formulated by a hired consultant
who, unfortunately, left the country suddenly. A summary of the
information that the consultant
developed is as follows:
Average Selling Price per Burger $7.50
Normal Monthly Costs Fixed Variable
Cost of Burger’s Sold $0 $5,500
Manager’s Salary 2,000 0
Wages 2,000 0
Rent 1,500 500
Utilities 500 200
Insurance and Commissions 1,000 0
Total Costs $7,000 $6,200
*Note: Costs are based on budgeted sales of 2,000 burger’s per
month.
The above information represents estimates for the operations
of a burger outlet. Link’s is
interested in opening the outlets as soon as possible and has
asked you to comment on the various
scenarios as reflected in the questions a thru to c below.
. " .
'
Required:
a) Compute the breakeven point for a burger outlet in terms of
both sales dollars and number of
burger’s sold each month. (6 marks)
b) The company is considering offering a promotional selling
price of $5.00 per burger during the
first month of operations. How many extra burger’s will have to
be sold by a burger outlet at
QUESTION 5 (CONTINUED)
the promotional price compared to the normal average selling
price in order to earn operating
income of $2,500 during the first month? (6 marks)
c) As an incentive program for the outlet manager, Link’s is
considering implementing an
alternative compensation method. Instead of paying the manager
a fixed salary of $2,000 per
month, the company is considering an incentive plan of $1,000
per month plus 8% of monthly
revenue Using this alternative method and the normal average
selling price per burger, calculate
how many burger’s will have to be sold to achieve an operating
income of $2,000 per month.(8
marks)
15 slides with speaker notesfirst you must study the demograph.docx

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15 slides with speaker notesfirst you must study the demograph.docx

  • 1. 15 slides with speaker notes first you must study the demographies of the Oak Ridge community then provide what is mantiond in the attachment.  make sure to include all the proposal requaires 1-14 in the attachment. the information for the new Oak Ridge airport can be found at flyknoxville.com Or in this link http://flyknoxville.com/wp- content/uploads/2015/10/ORAirportProgrammingStudyMarch20 122-1.pdf UNIVERSITY OF WINDSOR Odette School of Business 04-70-255 Section 30 Winter 2017 Professor Orawski 100 marks INDIVIDUAL ASSIGNMENT (Weighting 20%)
  • 2. ASSIGNMENT DETAILS 1. Read the following five (5) problem-solving exercises and answer the required questions. All necessary workings should be shown. Where appropriate, secondary sources of information used in your report should be referenced accordingly. All solutions must be in a MS Word format, font 12, New Times Roman, margins of 1 inch all sides on letter-sized paper and double- spaced except for numerical workings which can be single- spaced. Question 1: What to Do? Question 2: Pacific Air Corporation Question 3: Hillview Gardens Question 4: Elf’s Place Inc. Question 5: Link’s Fine Burger’s Inc.
  • 3. 2. Submission deadline: April 3, 2017 at end of class. 4. Late assignments without prior consent will be penalized at the instructor's discretion. It is the student's responsibility to inform the instructor as soon as possible of the circumstances regarding a late assignment. Assignments are considered late if they are not submitted by e-mail to the professor by the submission date. 5. The instructor reserves the right to deduct the marks of students who do not contribute to group work When there is academic dishonesty of any form, the instructor reserves the right to assign the normal default grade· of zero on the assignment in question. There will be no supplementary exam or assignments for individuals who have breached this code of conduct. You are responsible for the contents of the assignment and subject to the default grade. In this course, your assignment might be submitted to electronic verification for the detection of plagiarism. ..
  • 4. QUESTION 1 – WHAT TO DO? (19 marks) Linda Lindeman, manager and owner of an advertising company in Charlotte, North Carolina, had arranged a meeting with Eric Weddle, the chief accountant of a large, local competitor. The two are lifelong friends. They grew up together in a small town and attended the same university. Eric was a competent, successful accountant but currently was experiencing some personal financial difficulties. The problems were created by some investments that had turned sour, leaving him with a $25,000 personal loan to pay off just at the time his oldest son was scheduled to enter college. Linda, on the other hand was struggling to establish a successful advertising business. She had recently acquired the rights to open a branch of a large regional advertising firm headquartered in Atlanta, Georgia. During her first two years, she had managed to build a small, profitable practice; however, the chance to gain a significant foothold in the Charlotte advertising community hinged
  • 5. on the success of winning a bid to represent the state of North Carolina in a major campaign to attract new industry and tourism. The meeting she had scheduled with Eric concerned the bid she planned to submit. Linda: “Eric, I'm at a critical point in my business venture. If I can win the bid for the state’s advertising dollars, I'll be set. Winning the bid will bring $750,000 to $1,000,000 of revenues into the firm. On top of that, I estimate that the publicity will bring another $350,000 to $400,000 of new business.” Eric: “I understand. My boss is anxious to win that business as well. It would mean a huge Increase in profits for my firm. It's a competitive business, though. As new as you are, I doubt that you'll have much chance of winning." Linda: "You may be wrong. You're forgetting two very important considerations. First, I have the backing of all the resources and talent of a regional firm. Second, I have some political
  • 6. connections. Last year, I was hired to run the publicity side of the governor's campaign. He was impressed with my work and would like me to have this business. I am confident that the proposals I submit will be very competitive. My only concern is to submit a bid that beats your firm. If I come in with a lower bid and good proposals, the governor can see to it that I get the work." Eric: "Sounds promising. If you do win, however, there will be a lot of upset people. After all, they are going to claim that the business should have been given to local advertisers, not to some out-of-state firm. Given the size of your office, you'll have to get support from Atlanta. You could take a lot of heat." Linda; "True. But I am the owner of the branch office. That fact alone should blunt most of the criticism. Who can argue that I'm not local? Listen, with ·your help, I think I can win this bid. Furthermore, if I do win it, you can reap some direct benefits. With that kind of business; I can afford to hire an accountant, and I'll make it worthwhile for you to transfer jobs. I can offer you an up-front bonus of $25,000. On top of that, I'll increase your
  • 7. annual salary by 20 percent. That should solve most of your financial difficulties. After all, we have been friends since day one and what are friends for?" QUESTION-1 (CONTINUED) Eric: "Linda, my wife would be ecstatic if I were able to improve our financial position as Quickly as this opportunity affords. I certainly hope that you win the bid. What kind of help can I provide?" Linda: "Simple. To win, all I have to do is beat the bid of your firm. Before 1 submit my bid, I would like you to review it. With the financial skills you have, it should be easy for you to spot any excessive costs that I may have included. Or perhaps I included the wrong kind of costs. By cutting excessive costs and eliminating costs that may not be directly related to the project, my bid should be competitive enough to meet or beat your firm's bid."
  • 8. Required: (Please note this answer should not be more than 3 pages maximum) a) What would you do if you were Eric? Explain the reasons for your decision and apply the code of ethics to the proposal given, to Eric assume that Eric is a member of a professional accounting body. (10 marks) b) What is the risk to Eric personally if he reviews the bid? Should the degree of risk influence his decision? Explain your reasons. (9 marks) QUESTION 2 PACIFIC AIR CORPORATION (18 marks) Pacific Air Corporation is a business 'providing a wide variety of aviation products to pilots throughout the world. Dana Lombardi, the recently hired assistant controller, has been asked to develop a cost function to forecast shipping costs. The previous assistant controller had forecasted shipping department costs each year by plotting cost data against; direct labor-hours for the most recent 12 months and visually fitting a straight line through the
  • 9. points. The results were not satisfactory. After discussions with the shipping department personnel, Lombardi decided that shipping costs could be more closely related to the number of orders filled. She based this conclusion on the fact that 10 months ago the shipping department added some automated equipment. Furthermore, she believes that using linear regression analysis will improve the forecasts of shipping costs. Cost data for the shipping department have been accumulated for the last 25 weeks. She ran two regression analysis of the data, one using direct labor-hours, and one using the number of cartons shipped. The information from the two linear regressions is the following: Regression 1 Regression 2 Equation SC = 804.3 + 15.68 DL SC = 642.9 + 3.92 NR
  • 10. R-squared 0.365 0.729 Standard error of the estimate 2.652 1.884 QUESTION 2 (CONTINUED) Where: SC = Total shipping department costs DL = Total direct labour hours NR = Number of cartons shipped Required: a) Identify which regression equation (Regression 1 or Regression 2) that Pacific Air should adopt for forecasting total shipping department costs and explain your reasons. (7 marks) b) If Pacific Air estimates that 600 orders will be filled in the coming week, calculate the total shipping department costs using the regression that you have
  • 11. selected in part (a). (3 marks) c) Are there any limitations to the regression that you have selected in part (a) above? If so, identify ways to address the limitations. Include in your answer the effect, if any, of the global nature of Pacific Air Corporation business. (8 marks) QUESTION 3 HILLVIEW GARDEN CARE INC. (25 marks) Hillview Garden Care Inc. is a lawn and garden care service. The company originally specialized in serving small residential clients but has recently started contracting for work on large apartment and office building grounds. Since Phyllis Flower (owner) believes that commercial lawn care is more profitable she is considering dropping residential services altogether. Five field employees worked a total of 20,000 hours last year, 13,000 on residential jobs and 7,000 on commercial jobs. Wages amounted to $9 per hour for all work done. Direct materials used are included in overhead as supplies. All overhead is allocated on the basis of labour-hours worked,
  • 12. which is also the basis for customer charges. Because of the increased competition for commercial accounts, Phyllis can charge $22 per hour for residential work but only $19 per hour for commercial work. Recently, Phyllis attended an accounting workshop on overhead-costing and activity analysis. She applied what she had learnt on the company. Further analysis revealed that the overheads consist of activities relating to transportation, equipment use and supplies. These costs are attributed to the following cost drivers as shown below: QUESTION 3 (CONTINUED)
  • 13. Activity Level Activity Cost Driver Cost Commercial Residential Transportation Number of clients serviced $8,000 15 45 Equipment Use Equipment hours $18,000 3,500 2,100 Supplies Area serviced in square yards $36,000 130,000 70,000 Total Overhead $62,000 Required: a) If the overhead is $62,000, calculate the profits of commercial and residential services using labour as the allocation base. (7 marks) b) Recalculate your profits for the commercial and residential
  • 14. services using overhead as the cost driver.(10 marks) c) Based on your results for both a) and b), make recommendations to management on what action to take on both of these services and explain your reasons. (8 marks) QUESTION 4 – ELF’s PLACE INC. (18 marks) Elf’s Place Inc. (Elf’s) sells toys, games and books. A poplar service is the birthday service, which includes free gift wrapping and delivery of gifts to local families. Elf’s accepts cash, cheques, Visa, MasterCard, and American Express credit cards. These methods of payment have the following characteristics: Cash Payment is immediate; no fee is charged Cheque Payment is immediate; the bank charges $0.25 per cheque; and 1 percent of cheque revenue is from “bad” cheques that Elf cannot collect Visa/MasterCard Elf accumulates these credit card receipts throughout the
  • 15. month and submits them in one bundle for payment on the last day of the month. The money is credited to Elf’s account by the fifth day of the following month. A fee of 1.50 percent is charged by the credit card company. American Express Elf accumulates these credit card receipts throughout the month and mails for payment on the last day of the month. American Express credit’s Elf’s account by the tenth day of the following month. A fee of 3.50 percent is charged by American Express. QUESTION 4 (CONTINUED) During a typical month, the type of payment used by customers is as follows: American Express: 20% of sales Visa/MasterCard: 50% of sales Cheque: 5% of sales (average cheque is $37.50) Cash: 25% of sales
  • 16. Required: If Elf’s estimates sales of $30,000 in April and $60,000 in May, what are his planned net cash receipts for May? Show your workings. (18 marks) QUESTION 5 LINK’S FINE BURGERS INC. (20 marks) Link’s Fine Burgers Inc. (Link’s), is a new company currently studying various alternatives in regard to opening burger outlets. The only available data was formulated by a hired consultant who, unfortunately, left the country suddenly. A summary of the information that the consultant developed is as follows: Average Selling Price per Burger $7.50 Normal Monthly Costs Fixed Variable Cost of Burger’s Sold $0 $5,500 Manager’s Salary 2,000 0 Wages 2,000 0
  • 17. Rent 1,500 500 Utilities 500 200 Insurance and Commissions 1,000 0 Total Costs $7,000 $6,200 *Note: Costs are based on budgeted sales of 2,000 burger’s per month. The above information represents estimates for the operations of a burger outlet. Link’s is interested in opening the outlets as soon as possible and has asked you to comment on the various scenarios as reflected in the questions a thru to c below. . " . ' Required: a) Compute the breakeven point for a burger outlet in terms of both sales dollars and number of burger’s sold each month. (6 marks) b) The company is considering offering a promotional selling price of $5.00 per burger during the
  • 18. first month of operations. How many extra burger’s will have to be sold by a burger outlet at QUESTION 5 (CONTINUED) the promotional price compared to the normal average selling price in order to earn operating income of $2,500 during the first month? (6 marks) c) As an incentive program for the outlet manager, Link’s is considering implementing an alternative compensation method. Instead of paying the manager a fixed salary of $2,000 per month, the company is considering an incentive plan of $1,000 per month plus 8% of monthly revenue Using this alternative method and the normal average selling price per burger, calculate how many burger’s will have to be sold to achieve an operating income of $2,000 per month.(8 marks)