Question 1

Retail operations

‘Cycling Deal’ started its operation in bicycle retail industry on 1 June 2019. The business is

owned by Alex Richardson. Cycling Deal purchase bicycles from suppliers and sell those cycles

at the local markets. The business is registered for GST. The following transactions occurred

during June 2019:

Date Details

1-Jun Alex Richardson deposited $35,000 into the business bank account.

3-Jun

Purchase of bicycles (100 small bicycles, and 100 large bicycles) from Rocky

Hills Ltd on account for $10,000 ($50 per bicycle) plus GST on terms of 2/10,

n/30.

4-Jun

Cycling Deal received an invoice from Finland Delivery Ltd relating to delivery

costs for the bicycles purchased on 3 June. The amount due is $300

(including GST), and is due on 18 June.

5-Jun Sent a cheque in the mail to Green Ltd for $200 (including GST), for stall fees

at the local markets for the month of June.

6-Jun

Sale of 30 bicycles (15 small bicycles, and 15 large bicycles) at the local

markets, at $100 each (including GST). All of the customers paid by

cash. The money was banked at the end of the day.

9-Jun Paid Rocky Hills Ltd for purchases made on 3 June (net of the early payment

discount), by electronic funds transfer.

13-Jun Sale of 10 small bicycles to a local childcare centre, at $100 each (including

GST), on 30 day credit terms.

15-Jun Sent a cheque in the mail to Finland Delivery Ltd, in relation to the invoice

received on 4 June.

20-Jun Purchase of bicycles (40 small, and 15 large) from Rocky Hills Ltd on account

for $3,190 ($58 per bicycle) plus GST on terms of 2/10, n/30.ACCT6002_Assessment Brief 2_Individual Case Study

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23-Jun

Cycling Deal received an invoice from Finland Delivery Ltd relating to delivery

costs for the bicycles purchased on 20 June 2019. The amount due is $180

(including GST), and is due on 6 July 2019.

24-Jun Returned 20 of the small bicycles purchased on 20 June as they were

damaged.

28-Jun

Sale of 28 bicycles (18 small, and 10 large) at the local markets, at $100 each

(including GST). All of the customers paid by cash. The money was banked at

the end of the day.

30-Jun A stocktake was completed, and the number of bicycles on hand was 139 (54

small bicycles, and 85 large bicycles).

Mr Richardson has come to you for assistance, as he would like to use the perpetual inventory

system and the First-in-first-out (FIFO) costing method, but are not sure how to set this up.

equired

i) Prepare an Excel worksheet for each of the bicycle lines for June (one for the small bicycles,

and one for the large bicycles) using the FIFO costing method to keep track of the number of

bicycles purchased, bicycles sold, bicycles on hand, cost of goods sold and gross profit made.

ii) Prepare journal entries (including any adjusting entries) for all of the business’s transactions

for June (using the perpetual inventory system and FIFO costing method). Include dates,

references and narrations.

iii) Prepare T-accounts in an Excel spreadsheet, and post all of the above journal entries to

the T-accounts. Include dates and references for each entry. Total all of the T-accounts to

determine their balances at the end of the June 2019.

iv) Prepare the ‘Adjusted Trial Balance’ in an Excel spreadsheet as at 30th June 2019. Use

formulas to generate all of the figures in the ‘Adjusted Trial Balance’ from the balances in the

T-Accounts.

v) The business has a year-end of 30th June. Prepare the closing entries as at 30th June 2019.

vi) Prepare the income statement, balance sheet and statement of changes in equity in Excel.

Traditional trade theories assume that factors of production are freely mobile between industries and geographic regions within the same country. Therefore, workers who are displaced due to foreign competition can switch to other sectors in a different part of the country after a brief transition without any cost. In reality, labor markets tend to be sticky. Workers do not move even when labor market conditions would suggest they should and they are worse off as others who benefit from international trade are better off.

International trade increases total surplus and therefore increases efficiency, but it will be at the cost of equality. What is the role of government in helping people who lose as a result of foreign trade?

Note: The US government has a program called the Trade Adjustment Assistance Program (TAA) to help workers affected by foreign trade during their adjustment period. However, this program is criticized by Banerjee and Duflo, Nobel prize winners in Economics for not being sufficient

Please comment on what how you think, if at all, CSR changes when the company is not the US or when US companies deal with foreign companies. Does CSR have any impact on marketing? How so?

1. Scores on an MBA placement exam are reported to have a normal distribution with standard deviation 18. The exam officials stated that the average score for all students was 70. You take a random sample of 50 students and find their average score is 67. Use your data to estimate the mean score for all students taking the MBA placement exam -Verify your answer using calculations and show your work.

2. Students at the union want to estimate the average number of ounces of coffee in a cup. They take a random sample of 40 cups and find the mean is 5.2 ounces. Assume amount dispensed has a normal distribution and that the standard deviation is set at 0.24 ounces per cup. Find your best estimate for the average amount of coffee being dispensed by this machine. Verify your answer using calculations and show your work.

University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each.

The following data appear in the company records for the current period:

University Printers estimates that the variable costs in the Personnel Department total $18,500 and in the Maintenance Department variable costs total $7,800. Avoidable fixed costs in the Personnel Department are $6,300.

Required:

If University Printers outsources the Personnel Department functions, what is the maximum it can pay an outside vendor without increasing total costs? (Do not round intermediate calculations.)

University Printers has two service departments (Maintenance and Personnel) and two operating departments (Printing and Developing). Management has decided to allocate maintenance costs on the basis of machine-hours in each department and personnel costs on the basis of labor-hours worked by the employees in each.

The following data appear in the company records for the current period:

University Printers estimates that the variable costs in the Personnel Department total $16,000 and in the Maintenance Department variable costs total $8,500. Avoidable fixed costs in the Personnel Department are $5,200.

Required:

If University Printers outsources the Personnel Department functions, what is the maximum it can pay an outside vendor without increasing total costs? (Do not round intermediate

MAXIMUM AMOUNT?

In the past, SHR has relied on a collection of individual policies to communicate its expectations regarding
compliance with laws, regulations, and internal operating practices. The senior vice president – legal, who
also is designated as SHR’s CCO, has determined that the company has grown to a size and operating
complexity necessitating an integrated code of ethics and business conduct (the “code”). He has assembled
a team consisting of personnel from the legal, human resources, and internal audit functions to develop
this code.

Scenario 1 Activities
1. Explain why it is important to include representatives from the legal, human resources, and internal
audit functions in the development of the code. What other areas of the organization, if any, should
also be consulted when developing the code?
2. Based on the background and case facts describing SHR Corporation’s business, identify the types of
laws and regulations that the company is subject to and should consider for inclusion in the code.
3. Develop an outline for SHR’s code listing the sections that should be considered to create a robust,
comprehensive code. There is no need to develop any of these sections; simply create the outline.
4. Describe ways for communicating the new code and providing the necessary training to employees
and new hires.
5. There are other key elements to an effective compliance and ethics program. Discuss the value of the
following:
a. Annual certification of compliance.
b. Whistleblower hotline.
c. Escalation and investigation process.
d. Disciplinary action process.
e. Compliance program audits.

Spire is a nanosatellite and data analysis company based out of San Francisco. The company specialises in gathering unique data from small satellites in a low-earth orbit. Spire collect this data, pull it down and through a network of ground stations, and sell the Spire opened its European headquarters in Glasgow, Scotland. Data, like that provided by Spire’s nanosatellites, can be the key factor in fighting the extreme and unpredictable weather events that cause so much destruction globally.

Scotland has a well-known reputation for providing a first-class welcome to all its visitors and Spire management were very impressed by the warm and open reception they received from the Scottish Government agency. CEO and Co-founder Peter Platzer stated 'Where Scotland won out was the access to risk capital, the flexibility and, importantly, the Scottish Government’s eagerness to support innovative companies – this really stood out here’. His vision when he co-founded Spire was to be able to provide satellite powered data from any location on earth. He also claims that his staff are very pleased; ‘We had a number of overseas staff come here for a temporary position to help set up who have since decided that they want to stay here permanently. Glasgow is a really great place to live and Scotland in general - our people really enjoy being here. The words friendly and hospitable are really not rich enough in meaning to describe the experience of being a part of everyday life here in Scotland’.

As well as the positive welcome and help that they have had to settle into life in Scotland, Spire management also point out that a key factor in their location decision was the access to a talented work force. ‘When we looked at Scottish staff, we found that the passion for what they do, their character and work ethic, is absolutely world-class’.

Questions

1. Why did Spire choose to locate in Scotland?

2. Why do companies set up overseas manufacture and service operations?

3. Are reduced labour costs the main reason for relocation?

Kaizen Automotive, a Japanese automaker, has a production facility in Ohio that employees over 600 workers. In December 2013, it announces an executive position has opened at the facility and solicits applications. Among the finalists for the position is June, a Japanese citizen and graduate of MIT with four year's experience in automotive production. Another candidate is John, an African American who is also an MIT graduate and holds an MBA from Harvard. John has over ten year's automotive manufacturing experience. In very short order, Kaizen announces that June is the successful candidate and offers her the position. John files a charge with the EEOC alleging that he was not selected for the position because of his race and national origin. Kaizen states that it lawfully considered June's Japanese citizenship pursuant to a treaty permitting it to favor Japanese applicants. The subsequent EEOC investigation reveals that a Treaty of Friendship, Commerce and Navigation exists and that Kaizen has never promoted an American citizen to an executive level position in its U.S operations.

a. Does John have a viable Title VII complaint? Why or why not?

b. If June had been a U.S. citizen of Japanese ancestry, would the outeome be changed?

c. If June had been a Chinese citizen, would the outeome be changed?

We have all had supervisors that we thought could do a better job at managing their staff and we also hope to be better managers than what we have experienced at certain places of employment. Discuss the following with your classmates and instructors.

How should employees relate to supervisors who are inaccessible and who hoard information? What can employees do about this type of supervisor?

What characteristics are present in an individual with leadership potential?