Ikea is a Swedish based multinational corporation that designs and sells ready-to-assemble furniture and home accessories. IKEA is the largest furniture company in the world. It is known for its modern architectural designs, as well as its attention to continuous product development, operations details, and cost control. IKEA relies on design innovation to bring great quality and beautiful designs to the market and its stores by collaborating with the best designers from various parts of the world. It has developed cost efficient and innovative methods to match people’s expectations of price and quality. Answer all the three following questions in relation to IKEA. You can use your study material and other resources to write your answers. Use your own words and adhere to the wordcount specified for each question

Question 1: Innovation at IKEA (30 marks, 300 words) A. Why is IKEA an innovative company? Support your answer with examples. B. Discuss the role of four business functions at IKEA. Give at least two innovation examples for each business function at IKEA

Question 2: Product offering and targeting (30 marks, 300 words) A. Discuss the three levels of a product by using the HAMARVIK mattress as an example. B. Discuss the four targeting strategies. Which targeting strategy does IKEA use for its mattresses. Justify your answer. (Check the mattress section on the IKEA website before answering this question)

Question 3: The marketing mix and innovation (40 marks, 500 words) IKEA’s marketing strategy consists of market segmentation, targeting, positioning and the marketing mix. IKEA’s marketing strategy enables the company to be a successful player in the global market. Using your B207A course material, evaluate how the innovation in IKEA’s marketing mix elements are used to position the products within the minds of consumers. Your answer should contain the following: 1- IKEA’s market segmentation and targeting 2- What is positioning. How is it related to the marketing mix? 3- Examples of IKEA’s marketing mix elements and their contribution to brand positioning

Distributors sells snack and candy to local stores. On March 1, 2010, Borges issued $4,000,000 of 5-year, 13% bonds at an effective interest rate of 11%. Interest is payable semiannually on March 1 and September 1. Journalize the entries to record the following:

1. Sale of bonds on March 1, 2010. Use the tables on present values in Appendix A of your textbook to determine the present value of the bond issue. Round to nearest dollar.

                          ______________________________________________________

                          ______________________________________________________

                          ______________________________________________________

                         _______________________________________________________

                        _______________________________________________________

                        _______________________________________________________

                        _______________________________________________________

                       ________________________________________________________

                       ________________________________________________________

2. First interest payment on September 1, 2010, and amortization of bond premium for six months, using the straight-line method. Round to the nearest dollar.  

                           _____________________________________________________

                          ______________________________________________________

                          ______________________________________________________

                         _______________________________________________________

                        _______________________________________________________

                        _______________________________________________________

                        _______________________________________________________

Fireflies Limited began retail operations on 1/1/2010. On that date, it issued 10,000 shares of $1 par value common stock for $50,000. On 1/1/2010, Fireflies also borrowed $20,000 from a local bank. The loan will be due in three years, with 8% interest rate. Fireflies pays interests every quarter. On 1/31, Fireflies used $36,000 of the proceeds to rent a store, paying in advance for the next one year. Fireflies also purchased $12,000 of merchandise on credit, agreeing to pay the supplier within 30 days. Prepare, a balance sheet as of 1/31/2010.

Satisfied?A poll taken by the General Social Survey in 2010 asked people in the United States whether they were satisfied with their financial situation. A total of 478 out of 2038 people said they were satisfied. The same question was asked in 2014, and 698 out of 2532 people said they were satisfied.

a. Construct a 95% confidence interval for the difference between the proportion of adults who said they were satisfied in 2014 and the proportion in 2010.

b. A sociologist claims that the proportion of people who are satisfied increased from 2010 to 2014 by more than 0.05. Does the confidence interval contradict this claim?

4. Assume a company's January 1, 2010, financial position was: Assets, $75,000 and Liabilities, $30,000. During January 2010, the company completed the following transactions: (a) paid on a note payable $5,000; (b) collected an accounts receivable, $4,000; (c) paid an accounts payable, $3,000; and (d) purchased a truck using $2,000 cash, and a $13,000 note payable. The company's January 31, 2010 financial position is

Assets Liabilities Stock holders equity

A) $83,000 $38,000 $45,000

B) $65,000 $35,000 $30,000

C) $78,000 $37,000 $41,000

D) $80,000 $35,000 $45,000

Consider the following price data from 2002 to 2010

a. Compute the simple price index using 2002 as the base year. (Round your answers to 2 decimal places.)

b. Update the index numbers with a base year revised from 2002 to 2005. (Round your answers to 2 decimal places.)

The following information is taken from the records of XYZ Company Calculate the gross profit margin and net profit margin using the above data, and comment on the trend you observe. COGS are $189 million in 2013 and 93 million in 2012 and 66 million in 2011 and 65 million in 2010 and 50 million in 2009 gross profit is 63 million in 2013 and 48 million in 2012 and 54 million in 2011 and 60 million in 2010 and 50 million in 2009. and net profit is :12 million in 2013 and 5 million in 2012 and 15 million in 2011 and 20 million in 2010 and 15 million in 2009

On 1st July 2009 C Ltd acquires a 30% shares in J Ltd for an exchange of cash of $270 000. On acquisition date, the assets of J Ltd are reported at fair value and the total equity is:

Contributing equity $660 000 Retained earnings $240 000

A dividend of $5 000 is paid by J Ltd on 31st October 2009 from profits earned in 2008-09 period (pre-acquisition). For the year ended 30th June 2010, J Ltd records an after tax profit of $50 000 for the year. A further dividend of $20 000 is declared by J Ltd on 30th June 2010 from profits earned in 2009-10 period. On 31st October 2010, J Ltd pays the $20 000 dividend declared on 30th June 2010.

For the year end 30th June 2011, J Ltd records an after-tax loss of $25 000. On 30th June 2011, J Ltd declares dividends of $10 000 to be paid out of the profits earned in the 2010 financial year. On 30th June 2011 J Ltd re-values its land upwards by an amount of $200 000. Tax rate is 33%.

Required:

Prepare the journal entries under the equity method of accounting for C Ltd for the years ending 30th June 2010 and 30th June 2011 to account for its investment in J Ltd assuming that C Ltd is a parent entity which prepares consolidated financial statements.

1- What might be the underlying motivations of Geely's acquisition of foreign auto brand?
2- How does cooperation in international business offer competitiveness?
3- What role can the government play in promoting internationalisation?

China Globalises London's Black Cabs lobalisation refers to international transactions, co- company for last 70 years. Coventry city is the birth place of operation, and competition among firms. China has British motor industry and has long tradition of manufacturing become one of the most active trading nations in an iconic automobile brands like Jaguar, Rover, Triumph, and increasingly globalised world. China's pursuit in transforming Armstrong Siddeley. The FX4 model taxis rolled out in 1959 itself into an industrial economy gave birth to a thriving auto from Coventry plant set the quintessential shape for the black mobile industry and Geely Automobile Holdings Limited was cabs. They formed partnership with Geely in 2006 which fi- founded in 1986. Geely is a subsidiary of Li Shufu's Zhejiang nally acquired the taxi maker in 2012 for £11.4 million after it Geely Group. They began with motorcycle production and went into administration. London Taxi Company's current annual eventually started manufacturing cars in 1997. Geely's moto production is approximately 2000 taxis. Geely has been con- of 'Happy Life, Geely Drive' encompasses its customers, sup- stantly investing to increase capacity and competitiveness since pliers and human resource to manufacture safe, environmental acquisition. The company has recently announced a £250 friendly and god value automobiles. Relentless pursuit of bet million investment to build a new factory with a production ter technology, foreign brands and oversees market resulted capacity of approximately 36000 cars annually. This new in- in Geely's European acquisition of Volvo cars in 2010 and vestment is celebrated locally and nationally due to 1000 new London Taxi Company (LTC) in 2012. jobs creation and boost to the local economy. Geely's ambition London Taxi Company is the manufacturer of the iconic to put iconic London taxis in all major cities in the world require London Black Cabs. Coventry has been the home of the lots of innovation in emission technology and globalising the London taxi experience. The current technology is not suitable The Chinese state extended its support to fund Geely's for bigger cities due to high emission, less fuel efficiency and oversees ambitions. China EXIM bank is offering a 20 billion bulky weight. The company has pledged to invest a further £80 yuan credit line to Geely. This is exciting news for privately million in research and development of TX5 model with hybrid owned enterprises in China as favourable credit lines were engines. Hybrid and electric taxis are expected to roll out from mostly available for the state owned enterprises (SOEs) until the new factory in 2018. recently. This is an expected move from new Chinese leader- Western manufacturers are also developing strong manu- ship team under chronic overcapacity and mounting losses of facturing bases in China to tap the opportunities presented the State Owned Enterprises. by the increasing purchasing powers of Chinese people. Geely's ownership of London Taxi Company is an ex- Competition from foreign manufacturer, cost pressures due ample of multinational corporations (MNCs) from emerging to stringent regulatory requirements at home and volatility in economies acquisition in the industrial hearts of developed some export markets are some of the current challenges for countries. This is a fairly new phenomenon in international Geely. The management is searching for new opportunities to business which becoming more and more common with grow- overcome these challenges. ing powers of emerging economies.