Course: Contract and Liquid Chemical Co.

The Cost Analysis for Decision Making project is intended to be a comprehensive evaluation of the key objectives covered throughout this course. It will challenge you to apply your knowledge of cost information when evaluating the decision to make or buy a product. Please use this outline and grading rubric as a guide to completing your course project. It provides specific details of the required elements of the project, and it will be used by your instructor as a grading guide. Read Integrative Case 4-61, â€Å"Make versus Buy,† on pages 151 and 152 of the course text.Assume that you are the general manager (Mr. Walsh) faced with this decision. You have identified the following four alternatives available to Liquid Chemical Co. †¢Alternative A: It is the status quo. (i. e. , Liquid Chemical Co. will continue making the containers and performing maintenance. ) †¢Alternative B: Liquid Chemical Co. will continue making the containers, but it will outsource the maintena nce to Packages, Inc. †¢Alternative C: Liquid Chemical Co. will buy containers from Packages, Inc. , but it will perform the maintenance. Alternative D: It is completely outsourced. Packages, Inc. will make the containers and provide the necessary maintenance. Your project should include the following items: †¢Part (a): Discuss each of the four alternatives outlined above. Identify the relevant costs (including amounts) for each of the four alternatives, and explain why these costs are relevant to the decision. Identify any costs that are not relevant, and explain why they are not relevant. What are the advantages and disadvantages of each alternative? Who benefits and who loses? Part (b): Other than the relevant costs identified in Part (a), what additional information would you use when making your decision? Are there financial factors other than those identified in the case study that you would incorporate into your decision? What nonfinancial information would affect y our decision? †¢Part (c): As the general manager, which alternative would you choose, and why? Support your conclusion with facts and figures, as necessary. The Liquid Chemical Company manufactures and sells a range of high-grade products. Many of these products require careful packaging.The company has a special patented lining made that it uses in specially designed packing containers. The lining uses a special material known as GHL. The firm operates a department that maintains and repairs its packing containers to keep them in good condition and that builds new ones to replace units that are damaged beyond repair. Mr. Walsh, the general manager, has for some time suspected that the firm might save money and get equally good service by buying its containers from an outside source. After careful inquiries, he has approached a firm specializing in container production, Packages, Inc. and asked for a quotation. At the same time, he asked Mr. Dyer, his chief accountant, to let h im have an up-to-date statement of the costs of operating the container department. Within a few days, the quotation from Packages, Inc. , arrived. The firm proposed to supply all the new containers required—at that time, running at the rate of 3,000 per year—for $1,250,000 a year, the contract to run for a guaranteed term of five years and thereafter renewable from year to year. If the number of containers required increased, the contract price would increase proportionally.Packages, Inc. , also proposed to perform all maintenance and repair work on existing packaging containers for a sum of $375,000 a year, on the same contract terms. Mr. Walsh compared these figures with Mr. Dyer’s cost figures, which covered a year’s operations of the container department of the Liquid Chemical Company and appear in Exhibit 4. 13. Walsh concluded that he should immediately close the packing container department and sign the contracts offered by Packages, Inc. He felt an obligation, however, to give the manager of the department, Mr.Duffy, an opportunity to question his decision before acting. Walsh told Duffy that Duffy’s own position was not in jeopardy. Even if Walsh closed his department, another managerial position was becoming vacant to which Duffy could move without any loss of pay or prospects. The manager Duffy would replace also earned $80,000 per year. Moreover, Walsh knew that he was paying $85,000 per year in rent for a warehouse a couple of miles away that was used for other corporate purposes. If he closed Duffy’s department, he’d have all the warehouse space he needed without renting additional space.Duffy gave Walsh a number of considerations to think about before he closed the department: â€Å"For instance,† he said, â€Å"what will you do with the machinery? It cost $1,200,000 four years ago, but you’d be lucky if you’d get $200,000 for it now, even though it’s good for another five years. And then there’s the stock of GHL (a special chemical) we bought a year ago. That cost us $1,000,000, and at the rate we’re using it now, it’ll last another four years. We used up only about one-fifth of it last year. Dyer’s figure of $700,000 for materials includes $200,000 for GHL.But it’ll be tricky stuff to handle if we don’t use it up. We bought it for $5,000 a ton, and you couldn’t buy it today for less than $6,000. But you’d get only $4,000 a ton if you sold it, after you’d covered all the handling expenses. † Walsh also worried about the workers if he closed the department. â€Å"I don’t think we can find room for any of them elsewhere in the firm. However, I believe Packages would take all but Hines and Walters. Hines and Walters have been with us since they left school 40 years ago. I’d feel bound to give them a supplemental pension—$15,000 a year each for five years, sa y.Also, I’d figure a total severance pay of $20,000 for the other employees, paid in a lump sum at the time we sign the contract with Packages. † Duffy showed some relief at this. â€Å"But I still don’t like Dyer’s figures,† he said. â€Å"What about this $225,000 for general administrative overheads? You surely don’t expect to sack anyone in the general office if I’m closed, do you? † Walsh agreed. â€Å"Well, I think we’ve thrashed this out pretty well,† said Walsh, â€Å"but I’ve been turning over in my mind the possibility of perhaps keeping on the maintenance work ourselves. What are your views on that, Duffy? â€Å"I don’t know,† said Duffy, â€Å"but it’s worth looking into. We wouldn’t need any machinery for that, and I could hand the supervision over to the current supervisor who earns $50,000 per year. You’d need only about one-fifth of the workers, but you cou ld keep on the oldest and save the pension costs. You’d still have the $20,000 severance pay, I suppose. You wouldn’t save any space, so I suppose the rent would be the same. I don’t think the other expenses would be more than $65,000 a year. † â€Å"What about materials? † asked Walsh. â€Å"We use 10 percent of the total on maintenance,† Duffy replied. Well, I’ve told Packages that I’d give them my decision within a week,† said Walsh. â€Å"I’ll let you know what I decide to do before I write to them. † Assume the company has a cost of capital of 10 percent per year and uses an income tax rate of 40 percent for decisions such as these. Liquid Chemical would pay taxes on any gain or loss on the sale of machinery or the GHL at 40 percent. (Depreciation for book and tax purposes is straight-line over eight years. ) The tax basis of the machinery is $600,000. Also assume the company had a five-year time horizon for this project and that any GHL needed for Year 5 would be purchased during Year 5.

Macro Business Environment Essay

There are many different environments in marketing which will influence how successful a product will be. With a well rounded marketing plan, and taking into account the many different aspects of the environment any product can have a chance at success. The air blade fits extremely well into the macro business analysis. Aspects such as trends technology, economic, natural area, cultural will domestic will be discussed . Every area in the macro business environment is important. In this day and age technology plays a big role in this role. In terms of B2B it is essential. The air blade is new and one of a kind. There are no other products in the market quite like it and for that reason it has a big technological impact. It is more efficient more hygienic than any hand dryer on the market. For this reason the air blade is at the top of the food chain in terms of technology and has a great chance of completely taking over the market. The air blade†Making everyday products better† and in this particular area Dyson aims to be at the top. Probably its greatest advantage over any other product is its technology. The fact that the air blade is more efficient and cleaner than any other product proves that it has an edge over any other competitor. Since the air blade is such a high competitor all other companies in this market are going to have to change how they make their product so that the air blade doesn’t become a complete monopoly and put everyone out of business. There are a few uncertainties is this day and age. There are updated products coming out every day and the key is to make one so well that no one else will make an attempt. The Dyson is so new and well made its almost ahead of its time. There are no products like it and for that reason, it is certain that the air blade will be a success. In this particular area there are few trends going on. People have been using hand towels for so many years and no new trend have developed. We are now looking to develop a new trend. The demand for an efficient and cost effective product is at hand. Using high labor and cutting down trees to dry off hands is no longer an option. There are more people coming into the world every day a solution is needed to keep up with the demand . A new efficient and low maintenance product will set the new trend for a lifetime. Scenario planning for the technological aspect will is that there are advances being made every day. The whole fact that the air blade is so new even, if a better product come out which is highly unlikely the market is so small that it will likely not be affected too much. On the other hand, if nothing new id developed then the air blade will take over. For an environmental standpoint and looking at the natural and physical aspects of Dyson the air blade is a great product. Using renewable energy and learning to work more efficiently is now a new priority. The air blade is so advanced that its motor dries hands quickly and efficiently without heating, saving energy and resources. A high powered stream that is unheated saves 80% compared to not heating the air saves. Since the air blade uses a high-powered stream it saves us from having to cut down trees. Cutting down trees takes time and effort. As well as delivery and balancing the budget. It is a waste of time to use this solution any longer. Saving trees will also be better for the environment. In the future energy conservation we be one of the top issues. Products that are eco friendly will be applauded. The air blade is a new environmentally friendly solution which will make it so attractive to buy. The scenario for the air blade is that if energy continues to be cheap and available. The air blade may not take off as expected. But if energy becomes scarce then saving energy will become more important and be seen as serous issue. Energy conservation has around a 70% chance of being the major issue, while plentiful energy has only a 30% chance. These numbers are an estimate based on news reports and scientific studies. As a result this shows that energy conservation is becoming more urgent. In terms of a demographic scenario the air blade will take off and become extremely popular as the worlds population grows demanding new and more efficient solutions to  everyday life. The air blade will become a necessity for its convenient and cost effective as well as energy saving qualities. However if the world does not continue to grow then there is a chance that this aspect will not help in terms of making the air blade that much more of a necessity.

Rhetorical Analysis of the World Tradeorganization Essay

WTO: Why It Was Opposed – A Rhetorical Analysis of Top Twelve Reasons to Oppose the World Trade Organization Nowadays economic globalization is a trend. Free trade affects us every day. The World Trade Organization is writing the constitution and operating the global trade. However, more and more people start to think over: is free trade a universally good global economic system? Does the WTO can really inspire growth and prosperity for all? According to the Global Exchange, the answer is no and there are alternatives to the WTO. A flier distributed through the website for Global Exchange appeal to people to oppose the WTO and replace it with a democratic global economy. The flier strongly proves that the WTO does harm to the human rights, global economy and the equality between poor countries and powerful countries. As far as I am concerned, the flier works beautifully to make people realize the disadvantages of free trade and shortcomings of the WTO by enumerating twelve reasons clearly and by using logos, ethos and pathos successfully. The flier from the Global Exchange claims that the WTO has been the greatest tool for taking democratic control of resources out of our communities and putting it into the hands of corporations. There are twelve reasons listed that why people should oppose the WTO. By the mean of showing the disadvantages of free trade . Global Exchange persuade people to reject the expansion of the WTO and help build a political space that nurtures a democratic global economy. A essential persuasive technique in a advertisement or a flier is pathos. The author starts off the flier by a brief statement about the aim of the WTO in a sarcastic tone and then uses the positive tone to describe the team to oppose the WTO is becoming stronger and stronger. The sentences such as â€Å"an international movement is growing†¦. and importantly, we are winning! † make the readers believe that more and more people aware of the negative influence of WTO. We can also see the emotional sentences in the last two paragraphs of the flier. The author is trying to urge the readers to get involved in the international opposition to the WTO by using the short and powerful phrases like† Stop the WTO! †,† Get Involved! †. Using pathos can effectively engage readers’ emotion and imagination. In addition to the Pathos, ethos also has very important effect on this flier. The author presents a lot of specific information about the policies of the WTO and its practices in many aspects in recent years. All the facts, the reports from the authoritative organization like the United Nations Development Programs, the Universal Declaration of Human Rights, give the flier strong evidence and make it creditable. The major technique the author uses in this flier is the logos. In order to make the readers understand and accept the reasons to oppose the WTO, the author explains them very logically. He states the policies of the WTO first and then explains specifically how the WTO do harms by the facts. For example, one of the reasons to oppose the WTO is the WTO undermines local level decision-making and national sovereignty. First, the author states â€Å"the WTO requires that all WTO members countries to treat each other equally and to treat all corporations from these countries equally regardless of their track record†(90). Then, he explains how the WTO violates its own principle by some facts such as â€Å"the California’s Former Governor Gray Davis vetoed a â€Å"Buy California† bill that would have granted a small preference to local businesses because it was WTO-illegal. † (90) We can see the WTO rules are so rigid and unreasonable sometimes and undermine local decision-making severely. It is easier for the readers to understand through the logical explanations. The use of logos backs up the author’s claim and make readers agree easily. This flier clearly explains the disadvantages of the WTO and the free trade. The author uses logos to reveal the shortcomings of the WTO and ethos to strengthen the evidence. Pathos also make the flier be vivid and full of passion. Besides, it is also informative because it refers to a lot of information about the WTO and the global economy. In a word, it is a successful flier.

Evaluate the importance of women disciples in Mark Essay

Evaluate the importance of women disciples in Mark - Essay Example In the Gospel of Mark, women are presented as the ones who faithfully remained with Jesus Christ during His passion till His death3. In the Gospel of Mark we read the following â€Å"There were also women working on a far off; among whom was Mary Magdalene, and Mary the mother of James the less, and of Joses, and Salome; Who also, when he was I Galilee, followed him, and ministered unto him; and many other women who came up with him unto Jerusalem’’4 . In the Gospel of Mark therefore, women disciples are contrasted with the male disciples who ran away during the passion of Jesus Christ. Even Simon peter, who had early promised Jesus Christ that he would never abandon him, eventually abandoned Jesus Christ. Women therefore are presented in the Gospel of Mark as faithful disciples, who are ready to endure all manner of sufferings for the sake of their faith. Again, as we have seen in the above quotation, the women who remained faithfully with Jesus Christ during his passion had been with Jesus Christ, throughout his ministry, ministering to him. This fact shows that women disciples were quite important in the ministry of Jesus Christ. Besides enduring sufferings and remaining faithfully with Jesus Christ during his passion, women disciples also discovered, as it were, Jesus’ suffering messiahship before the male disciple. On this view, the feminist Bible scholar Elisabeth Fiorenza in her book, A Feminine Theological Reconstruction of Christian Origins, states that it was a woman who recognized Jesus’ suffering messiahship, and in a prophetic sign-action, the woman anointed Jesus for his burial, while some of the male disciples of Jesus Christ reprimanded her5. The women disciples in the book of Mark, therefore, are presented as having a clear knowledge of the mission of Jesus Christ as a suffering Messiah. In the Gospel of Mark, in the healing miracles of Jesus Christ, women are portrayed as a model of Jesus Christ’s

Business Decision Analysis Project Essay Example | Topics and Well Written Essays - 1250 words - 1

Business Decision Analysis Project - Essay Example This analysis report will help decide whether James starting a new business will generate enough income to cater for the income that James will forgo so as to run the new business. Also, the report will give him sound financial advice for his decision-making process. We shall also use US Code 1031- tax free exchange in the report. The rule states that a company can defer capital gain taxes if he sells property to reinvest in another one. Mr James Wiesman faces the major challenge of deciding whether or not he should buy/lease the equipment needed to manufacture the products or buy them from another company. Currently, Mr James owns a construction patent of a process that reduces the cost of production tremendously. The patent is highly lucrative, which has led to Mr James to sign contracts with the U.S. government to supply the products to the navy and army for Barrack constructions. The facts of this problem are that the cost of producing the products himself will attribute for 60% of his total costs (Glen& Howard, 91). In addition, the cost of production of the materials will be a third of buying it from another company. It is evident that the cost of buying the product from another company will be much higher than the former. Based on the mentioned facts, it is advisable that Mr James Wiesman buys/leases the equipment needed for production. Buying or leasing equipment will require Mr James to open his own firm. The initial costs of production include the purchase of land, building costs and the working capital that sum up to over2,120,000 $. Mr James has to decide the sources for his financing to make this decision. He has two options to choose. Firstly, Mr John Money Bag is willing to give him 2,000,000$ for controlling interest of the company as well as semi-active management participation. Secondly, Mr James can sell off some of his assets to raise the funds necessary for production. Mr James is

Negotiation and Conflict Essay Example | Topics and Well Written Essays - 750 words

Negotiation and Conflict - Essay Example 2. Circumstances based on the Power factor: Under the circumstance that one party has more power than the other; the negotiation often progresses in favour of the more powerful person. This is mostly applicable in the case of employer – employee, jailor – prisoner, competitors, commitments, experienced – fresher, etc. (Herb Cohen, 2004, Pg 40 – 70) 3. Circumstances based on the information factor: This is applicable when one of the negotiating party’s has more information than the other. This is mostly applicable in relationships between manufacturer and wholesaler. But it is widely applicable in the all new ‘buy – from – China’ trend. This is due to the fact that the manufacturer has a deep knowledge of the production process and the costing of the product and under most cases the marketer of the product has none. (Herb Cohen, 2004, Pg 76 – 89) 4. Telephonic negotiation: Negotiation on the telephone is a whole lot tougher then it seems. Of course, it is easy to speak and curse the other party involved in the negotiation but the other party can do the same and telephonic negotiation will not only give you a chance to speak more fluently then in person but it will give the other party involved the same benefits and under most cases the caller loses because by calling your client or supplier you’ve already proven that you (the calling party) need him more then he needs you. 5. Information of BATNA (Better alternative to the negotiating agreement) (Lewicki, Roy J, Barry, Bruce and Saunders, David M, 2007): In the case you are already prepared with the BATNA and the other party comes to know of it. You may just as well suppose that you’ve already lost your present negotiation agreement and you might have to accept an agreement that is even worse off then the BATNA itself. Yes. I definitely consider Distributive bargaining as a dominant form for any negotiation strategy. This is due to the basic and known fact

Juvenile Delinquency in the USA Research Paper Example | Topics and Well Written Essays - 1500 words

Juvenile Delinquency in the USA - Research Paper Example The author of the paper states that are the expectations of the public that crime instances done by young offenders will continue to increase anyway no matter what actions and prevention methods the public and the society as a whole try to carry out in order to thwart the prevalence of offenses and criminality. These prospects have their foundations on the forecast of the U.S. Census Bureau which projects that the crimes committed by the young, aged 15-17 - the age group responsible for 30 percent of the offenses incurred by the juveniles - will increase 20 percent by this year (2007) (Ferro 2003). What is worse, the Office of Juvenile Justice reported that the juvenile offenders or children in conflict with the law, who have been relocated into the adult criminal justice system, have escalated in number. In addition, near the turn of the previous century, 40 states including the District of Columbia passed legislation, which eased legal constraints in trying juveniles as adults in t heir respective jurisdictions (Griffin et al. 1998). In order for us to understand why this occurrence cause alarm on the public and the on our justice system, we have to fully comprehend the underlying principles with regards trying juvenile offenders in adult courts which employ adult criminal laws and statutes. Likewise, it is necessary to understand the legal principles that govern young offenders and when these juveniles should not be tried as adults. All states in the United States of America including the District of Columbia permit adult criminal prosecution of juveniles under definite conditions. Under the waiver provisions, for instance, decisions of the transfer of the offender from a juvenile institution to an adult court or adult criminal institution is left to the State's juvenile courts, but clearly provides that young offenders may not be prosecuted as adult criminals unless a juvenile court judge has ordered the transfer (Griffin et al. 1998). The provisions vary fr om one another in the extent of flexibility with which the conditions allow the courts. However, under these provisions, a case against a juvenile must at least originate in juvenile court and cannot be directed anywhere else, unless there is a formal approval from juvenile court judge. In the Direct File provisions, the prosecutor determines whether to commence a case against a young offender in juvenile court or in criminal (adult) court. In Statutory Exclusion, criminal courts are bestowed jurisdiction on the classes and levels of cases involving juveniles. Under this provision, a State legislature fundamentally predetermines the question of criminal prosecution and carries out the decision, bypassing the authority of the prosecutor and the court (Roberts 2004 & Griffins 1998). Nevertheless, these provisions are bestowed to juvenile offenders under specific conditions. Most states in the US contend that the prosecution of the young offenders in adult criminal courts is a legislat ive remedy and a response to the growing violent offenses, but surprising numbers of laws in many states in the country authorize criminal trial even for non-violent offenses. Presently, 21 states permit adult prosecution of juveniles charged of offenses related to property as, for instance, arson and burglary while 19 states afforded provisions in their statutes authorizing prosecution of young people in conflict with the law - whose offenses are drug related - in adult court. Forty-six of the 50 states in this country permit issuance of a waiver for a variety of offenses including personal, property, violent and non-violent (Ferro 2003).