Rocky Mountain Mutual Case Study

-A much higher overhead could lead to losses at the beginning because they have to hire many new employees with each opening of a new store: therefore, this could

Sunk Costs: - Big sunk costs. It is difficult to exit from the industry. Surviving and beating competition is the only way to do business.

In the same way should be treated cost of $1 million related to dismantlement of the existing manufacturing operation. According to the ASC 420-10-24-14, this cost

The original cost of the facilities at Clayton is a sunk cost and should be ignored in any decision. The decision being considered here is

It presents our department in a way to show our dedication to motivating our employees because if our employees are not happy it could reflect on their performance which in-turn would reflect on our customer satisfaction.

Through this case study I will be discussing strategic management. Strategic management can be defined as a process where an organization attempts to determine what actions need to be taken to achieve the overall objectives and more importantly how to meet them (Mello, 2015, p. 114). For a company to strive and meet their goals, deadlines, and missions they must stay conscious of the strategic plan put in place for the success of the company. If the company does not have a good strategic plan the company could fail. With correct planning a company could succeed without fail. Something that needs to be taken into consideration in the strategic plan should be investing into the company’s human assets. At first it may look like it is causing the company more issues however in the long run it will strengthen the company and moral making a more successful company. This could help with customer relations, and the organization status which will help produce additional revenue for the company.

Fitness is in. The percentage of people belonging to health clubs and gyms has doubled over the past 20 years. More growth is expected, fueled by an aging Baby Boomer generation in search of eternal youth and the reality that regular exercise can prevent or control diseases that are driving health care costs relentlessly upward. The 24/7 fitness opportunity is the newest model of fitness centers today.

A sunk cost is any cost that was expended in the past but can be recovered if the firm decides not to go forward with the

Our company, Eli-Gar LTD. are the parent company of Gold’s Gym of South Texas and have been in the fitness industry since 2005. We have focused our growth in North Laredo and the Rio Grande Valley, however, in recent years our group have come to the realization that Laredo is a very different city from what it was 11 years ago. In the past, many businesses may not have deemed it financially responsible to invest their money in an underdeveloped area such as South Laredo, but times have changed and we feel that South Laredo deserve all the amenities and services that may currently only be offered in North Laredo.

ASC 420-10-25-12 provides guidance for the recognition of costs to consolidate or close facilities as follows:

Effective and efficient companies will need information on the country and the industry before setting up their operation in the stated area. This report focuses on Fitness First as one of the leading global health club companies and Singapore as the chosen country. The purpose of this report is to provide the PESTLE analysis on Singapore along with the Porter’s 5 forces analysis on fitness industry in the country, to understand how the company entered the industry’s market. The structure of this report will be as following; company background, country background, PESTLE analysis, Porter’s five forces, strategic recommendations, and the conclusion.

The actual production would begin in the third quarter of this year, therefore only half year’s depreciation should be counted on Equipment and IT communication in 2004 (According to Appendix A). The following years (2005-2008) incremental cash flows are computed by the same method. However as the IT equipment and furnishings would be depreciated on a straight line basis over 3 years, thus in year four (2007), there would be only half a year’s deprecation left and after that it will be used up. The last year’s net cash flow in 2009 should be included the extra terminal Value on that year, which includes 24 years’ residual value on building and one year and a half residual value on equipment totaled $2,990,412 with two assumptions of by using residual book values for the building and operating equipment and there will be no further NWS advantage after year 2009. Finally, by obtaining 6 years’ incremental cash-flows and discounting them back to time zero (with the estimate rate of return by 15%) lessing initial cost to get an appealing NPV of $1190528 (Luehrman, p. 3).

Issues containing weight control, fitness, and nutrition are a prime subject in today 's culture. Completive companies are existent and they have many different levels of health clubs and fitness centers; this contains everything thing from price, equipment, staff , activities and classes offered. In the present time, topics being subjected through the industry are; disease control and research, diet and fitness trends of 2005, performance running, life balance, eating and sleeping right, working out according to personality and foods to lower cholesterol. Many people from The States are on a constant search for what is new, healthy and trendy. Health and fitness clubs were put in our society to make people feel and look good, and now not only are they there for that but they are making a large profit as

deprecation. The tax depreciation rate for this type of plant is 25%. The company tax rate is

Sunk cost is the money that has been spent in the past or considered gone.