Top-Slice Drivers

Taken from, Waddell, Jones, and George (2013) 3rd Edition.  Contemporary  Management, Sydney, McGraw Hill (pages

2. Refer to the above table to answer this question. Suppose that Mia has a budget of $7 and the price of a litre of soya milk is $1, what is the maximum quantity that Mia might purchase?

G.G. Dess, G.T. Lumpkin, M.L. Taylor, A.A. Thompson, and A.J. Strickland III, Strategic Management (Boston, McGraw Hill, 2004) pp. 141-148.

Fall 2009 This case was prepared by Itir Karaesmen and Inbal Yahav of Robert H. Smith School of Business at University of Maryland, College Park. The names, locations, and other information included

Explain how a profit maximizing firm determines its optimal level of output, using marginal revenue and marginal cost as criteria:

This case was written by Rhonda Engleman and Jisun Yu under the supervision of Professor Andrew H. Van de Ven of the Carlson School of Management at the University of Minnesota. We also appreciate the editorial assistance of Julie Trupke and useful comments of Gyewan Moon and Margaret Schomaker. We gratefully acknowledge Stuart

1. The local Mastermind store sells innovative educational toys. Part of their service is giving advice to customers about the best toys for a particular age group, which requires having more customer service representatives in the store. During the month long Christmas buying season, it makes half of its $500,000 yearly sales. Its contribution margin on average is 40% and its fixed costs for the year are about $150,000. The owner believes that she could make even higher sales, if she had more customer service representatives on the floor during the peak season. She plans on hiring four more people for 200 hours each at $20 per hour. How much additional revenue does she have earn to the nearest dollar

Copyright 2006 The Society of Management Accountants of Canada All rights reserved. No part of this manual may be reproduced in any form without the permission of the copyright holder.

b) Assume now that a new technique, technique 4, is developed. It combines 2 units of labor, 2 of land, 6 of capital, and 3 of entrepreneurial ability. In view of the resource prices in the table, will the firm adopt the new technique? Explain your answer.

Along with capacity, we also made it a focus to limit the amount of overtime and second shift workers. This kept our costs down and our profit margin wider. We paid attention to our inventory on hand and made sure to not schedule more production than was needed. Towards the later rounds, we really seemed to grasp the idea of the game, which can be seen in our large increase in profitability. In the Finance portion, we borrowed money in the first five weeks to pay off our current debt. As the game got into the later rounds we began paying off our current and long term debt because our profits were increasing at a higher rate. Overall, we believe that our group had a decent understanding of the concepts as we finished with high market share and profits.

Based on their past experiences, Riordan may need to consider looking for another company to purchase their motors from in order to foster a make-to-stock operation. This allows for a forecasting of potential sales based on an average of the past three year’s sales and projecting that for the future year sales. This may help in creating a more competitive market for manufacturing and delivery of their product.

i. Calculate the rooms sold, occupancy %, and sales dollars he will need to achieve his desired profit if he opens the gift shop.

v. What are the limitations, if any, to the estimates of the profitability of the two customers? (Hint: Consider what improvements could be made to the accounting system to obtain more accurate costs)

Hubbard, G, Rice, J and Beamish, P 2008, Strategic Management, Pearson Education Australia, 3rd, Frenchs Forest, Australia.

Colin's unemployment status has caused him to consider opening up his own business. His dilemma is deciding where to locate his business; either at Great Eastern Building downtown or Exploits Valley in the mall. Due to him being unemployed, Colin needs to begin earning an income to live. To do so he needs to improve his projected sales so that his net income would be sufficient to live on and to be able to pay back Ed's investment in the business.