Bilston case study Essay Example | Topics and Well Written Essays - 1000 words

Bilston case study - Essay Example . In addition, the company must characterized some of the costs as fixed costs. The fixed cost are electricity, general and administrative, rent, depreciation expense, interest expense, and other factory costs. The company must some fo the costs as fixed costs. The variable cost are labor cost, raw materials, and repairs (Abele 2008). II. The standard contribution marging includes the variable costs and the fixed costs elements. Table 1 shows that the contribution margin for the wood screws is .0117. This is arrived at by deducting the variable costs from the revenues. The variable costs are the labour cost, raw materials costs, and the repairs costs. Table 2 shows that the contribution margin for Self Taffers is 0.0251. This is arrived at by deducting the variable costs from the revenues. The variable costs are the labour cost, raw materials costs, and the repairs costs. Table 3 shows that the contribution margin for the wood screws is .0118. This is arrived at by deducting the vari able costs from the revenues. The variable costs are the labour cost, raw materials costs, and the repairs costs. Display of the company’s Profit and loss account for 2009 in contribution format. Table 4 shows that company’s profits and loss account for 2009 for its wood screws products. The company generated profit of 295 for the said year. Table 5 shows the revenues of its self taffers products for the year 2009. Table 6 shows the company’s Nuts and Bolts division’s profits and loss account for 2009 for its wood screws products. The company generated a loss of (219) for the said year. Table 6 shows the revenues of its self taffers products for the year 2009. The above discussions show that the company did not fare well in the two remaining product lines. On the other hand, the company did well in one of the three products scrutinized (Besley, 2008). III. Discussion of the company’s proposal to drop one of its failing products. Starting in January 2010 (based on 2009 figures). The company should not drop the nuts and bolts in January 2010 if the basis for the dropping is the 2009 annual income statement result. Continuing with production of the nuts and bolts generates a lesser loss of only 219.00 However, dropping the nuts and bolts section of the company’s production department would force the company to continue paying the fixed expenses. The fixed expenses are higher than the net loss of only 219.00 (Dubrin, 2008). IV. Discussion on whether the company should reduce prices of the wood screws to ?2.25 in the second half of 2010. The company should drop the price from to the lower 2.25. The lower price will generate a higher volume of revenues from 750 units to the higher 1,000 units. In addition the results of operations at 2.25 is higher than the results of operations for the prior higher selling price of 2.45 (Khan, 2006). V. The company’s total company profit forecast for second half 2010 assuming the pri ce of woodscrews is dropped to ?2.25, again taking account of the variances. Table 7 shows that company’s woodscrews products will be sold at a lower selling price of ?2.25. The table 7 financial statement shows that reducing the price from 2.45 to 2.25 is a good management decision. The reduction in the selling prices generates an in crease in the revenues by 250,000 units. The results of operations for the 2.25 price is better than the result sof operations pegged at 2.45 price (Moyer, 2009). IV. Long term prospects for Bilston.The fixed

DB 4 Management and Leadership Research Paper Example | Topics and Well Written Essays - 250 words - 1

DB 4 Management and Leadership - Research Paper Example In the case of an internet retailer that involves a lot of inventive technology, and organizational flexibility, I would draw on the mission of the organization, as this would allow me work with what to expect in the future, and what the employees must strive to portray in the long run. Working on the mission statement allows the organization function outside the existing boundaries, and instill more creativity among the employees. I will also be very positive and inspiring to my employees, as this is the only way that the cycle of goals, objectives and strategies will be complete (Cawsey, Deszca & Ingols, 2011: 121). Working with the sub-units in the retail organization would allow me devise a change process. Cawsey, Deszca & Ingols (2011: 121) argue that working with sub-sections allows for generation of emotional vigor, commitment, and clear direction of the ideal future of the internet retailer. Since an entry and consistency in the internet retail market requires that the change agents- leaders- dream big, I will endeavor to come up with exciting, concise and challenging visions. In this case, I will have energized and mobilized employees to undertake initiatives that will lead to the internet retailer one of the best shops in existence (Cawsey, Deszca & Ingols, 2011: 121). My mission statement will be, ‘†¦by offering quality services, we motivate and encourage our employees to continually offer the best to our clients...’ With this, I will have created a dream on the ideal future of the organization; thus, dictate the same shape of ideas to the attainment of the organization’s aims and objectives. Vision, therefore, is the basis of a stronger, better and a unique organization (Cawsey, Deszca & Ingols, 2011: 121).A change leader must always come up with a vision and a team that will be useful in the implementation of the