Illustration Capsule 5.1 discusses Amazon’s low-cost position in the electronic commerce industry. Based on information provided in the capsule, explain how Amazon has built its low-cost advantage in the industry and why a low-cost provider strategy is well suited to the industry.

MBA class. Business Strategy and policy class MB 695.

Book: Crafting and Executive Strategy: The Quest for Competitive advantage: conept and cases, 21st edition by Arthur Thompson

Celestila Moonn, an UMB MBA student selected Google stock for Capital Market/Portfolio construction project. Last week, Moonn realized that the stock lost 10% of its value since the stock was purchased. Moonn also noticed that Google pays no dividends yet investors are willing to buy shares in this firm.

In your initial post, briefly justify: How is this possible? Does this violate the basic principle of stock valuation? Do you support Moonn’s concerns?

The problem of many developing businesses has always been attributed to insufficient or lack
of capital to run these enterprises. But on taking an MBA course at the University of Ghana
Business School, you have come to realize that most businesses in Ghana and Africa fail not
because of capital adequacy issues but rather, human resources management issues. What
significant expectations would you give to all HR managers as needed competences to be
equipped with if you are the consultant general to businesses in Ghana?

Look at the following research questions. What would be an appropriate audience for each one? Why did you come to that answer?

1. How does the use of texting affect high school English grades?
2. What effect do medical budget cuts have on small town hospitals?
3. Does earning an MBA make you a better job candidate?
4. Why does the American government lend money to foreign countries?

1)  Explain the primary benefits of a business education?

2) Why is pursuing an MBA immediately after finishing an undergraduate degree generally a bad idea?

3) briefly describe the various alternatives to a formal business education.?

4) Explain the difference between “training” and “education”. Then explain the role of each in higher education (and specifically in business school)?

5)  What does a business degree signal to an employer?

6) Briefly describe the various formats for a business degree?

App Problem 2-81 Preparing Reversing Entries Log b. Prepare an accruauustu ... Rona Company is a calendar-year manufacturer. Rona is reviewing the following transactions for possibles ing entries at December 31, 2020. 1. One of Rona Company's liabilities is a 12%, 540,000 long-term note payable, which requires interes paid each March 1 and September 1. 2. Rona Company owns a $20,000, 10% bond, which it purchased at face value and which pays interest August 1 and February 1. 3. Rona Company performed and completed services for a customer in December for a $12,000 total fe: 1 customer was not billed and did not remit payment in the current year. The customer has a strong as rating. 4. Depreciation of $30,000 is to be recorded. 5. Salaries totaling $15,000 were earned but not paid or recorded at year-end. The first payroll in 200164 pected to total $45,000 6. Rona paid $4,800 cash for a one-year insurance policy on September 1, 2020. Rona records the full an! on September 1 as insurance expense. Required For each of the 6 items described above, provide the following: a. December 31, 2020, adjusting entry. b. January 1, 2021, reversing entry (if a reversing entry is not appropriate, explain why). c. Entry for the associated transaction to occur in 2021 if one is expected.
USCU Statement of income. 1. App-Problem 2-81 Preparing Reversing Rona Company is a calendar-year manufacturer. Rona is reviewing the following transactions for possible adjust- Entries Log ing entries at December 31, 2020. One of Rona Company's liabilities is a 12%, $40,000 long-term note payable, which requires interest to be paid each March 1 and September 1. 2. Rona Company owns a $20,000, 10% bond, which it purchased at face value and which pays interest each August 1 and February 1. 3. Rona Company performed and completed services for a customer in December for a $12,000 total fee. The customer was not billed and did not remit payment in the current year. The customer has a strong credit rating. 4. Depreciation of $30,000 is to be recorded. 5. Salaries totaling $15,000 were earned but not paid or recorded at year-end. The first payroll in 2021 is ex- pected to total $45,000. 6. Rona paid $4,800 cash for a one-year insurance policy on September 1, 2020. Rona records the full amount on September 1 as insurance expense. Required For each of the 6 items described above, provide the following: a. December 31, 2020, adjusting entry. b. January 1, 2021, reversing entry (if a reversing entry is not appropriate, explain why). c. Entry for the associated transaction to occur in 2021 if one is expected.

Michele Diaz is the founder of Diaz Manufacturing. Michele plans to expand her business. Company’s expansion plans require a significant investment, which she plans to finance with a combination of additional funds from outsiders plus some money borrowed from banks. Company’s financial records are not well maintained. Naturally, the new investors and creditors require organized and detailed financial statements than Michele has previously prepared. Ms. Diaz has assembled the following information:     

($ millions)

Michele Diaz is ready to meet with Austin Mark, the loan officer for Wells Fargo. She is asking to borrow $30 million. The meeting is to discuss the mortgage options available to the company to finance the new facility.

Austin begins the meeting by discussing a 30-year mortgage. The loan would be repaid in equal monthly installments. Because of the previous relationship between Diaz Manufacturing and the bank, there would be no closing costs for the loan. Austin states that the APR of the loan would be 6.00 percent. Ms. Diaz asks if a shorter mortgage loan is available. Austin says that the bank does have a 20-year mortgage available at the same APR.

Michele decides to ask Austin about a “smart loan” she discussed with a mortgage broker when she was refinancing her home loan. A smart loan works as follows: every two week a mortgage payment is made that is exactly one-half of the traditional monthly mortgage payment. (Hint: To determine how much is bi-weekly payment >>>calculate PMT as if it is 30-year mortgage and then divide by 2). The APR of the smart loan would be the same as the APR of the traditional loan.

Austin also suggests a bullet loan, or balloon payment, which would result in the greatest interest savings. At Michele’s prompting, he goes on to explain a bullet loan. The monthly payments of a bullet loan would be calculated using a 30-year traditional mortgage. In this case, there would be a 5-year bullet. This would mean that the company would make the mortgage payments for the traditional 30-year mortgage for the first five years, but immediately after the company makes the 60^th payment, the bullet payment would be due. The bullet payment is remaining principal of the loan. Ms. Diaz then asks how the bullet payment is calculated. Austin tells her that the remaining principal can be calculated using an amortization table, but it is also the present value of the remaining 25 years of mortgage payments for the 30-year mortgage.

Michele has also heard of an interest-only loan and asks if this loan is available and what the terms would be. Austin says that the bank offers an interest-only loan with a term of 10 years and an APR of 3.9 percent. He goes on to further explain the terms. The company would be responsible for making interest payments each month on the amount borrowed. No principal payments are required. At the end of the 10-year term, the company would repay the $30 million. However, the company can make principal payments at any time. The principal payments would work just like those on a traditional mortgage. Principal payments would reduce the principal of the loan and reduce the interest due on the next payment.

Tony is still unsure of which loan she should choose. She has asked you to answer the following questions to help her choose the correct mortgage.

1. What are the monthly payments for a 30-year traditional mortgage?

2. What are the payments for a 20-year tradition mortgage?

3. Prepare an amortization table for the first six months of the traditional 30-year loan. How much of the second payment is interest?

4. How long would it take for Diaz Manufacturing to pay off the smart loan assuming 30-year traditional mortgage payment?

Why is this shorter than the time needed to pay off the traditional mortgage? How much interest would the company save?  

5. Assume Diaz Manufacturing takes out a bullet loan under the terms described. What are the payments on the loan?

6. What is the amount of the last payment of the loan?

7. What are the payments for the interest-only loan?  

8. Which mortgage is the best for the company? Are there any potential risks in this action?

Digital Designs is a Michigan corporation, owned 100% by its founder Nicole Burke. The average annual gross receipts for the prior three years is $30,000,000. Digital Designs creates cartoon characters that are imprinted on its T-Shirts, magnets, stickers, and various other products. Its revenues largely come from sales of its products to retail stores through independent sales agents who receive a commission. The remainder of its revenues consists of royalties from licensees who pay Digital Designs a fee for the use of its cartoon images.

Digital Designs uses several independent contractors to manufacture its products. In manufacturing its products, Digital Designs creates cartoon characters and sends the original drawing as “flat art” to an independent printer. The printer photographs the cartoon drawing performs color separations and creates a “proof” of a particular product, which is shipped to Digital Designs for approval. The printer provides its own stock of blank T-shirts, paper, and ink, etc. and bears the risk of loss of the supplies and printed goods until they are shipped to Digital Designs. Once Digital Designs approves the proof, it sends a purchase order to the printer. The printer is not permitted to sell the products to anyone and does not have a proprietary interest in the cartoon characters created by Digital Designs. Once the printing is complete, the printer sends the finished products to Digital Designs, whose employees package the products for sale to retailers.

Prepare a memo to Nicole Burke discussing whether Digital Designs is considered a producer for purposes of Section 263A (UNICAP).

Sam Walton, founder of Walmart, had an early strategy for growing his business related to pricing. The “Opening Price Point” strategy used by Walton involved offering the introductory product in a product line at the lowest point in the market. For example, a minimally equipped microwave oven would sell for less than anyone else in town could sell the same unit. The strategy was that if consumers saw a product, such as the microwave, and saw it as a good value, they would assume that all the microwaves were good values. Walton also noted that most people don’t buy the entry-level product; they want more features and capabilities and often trade up. Choose one side, either defending this strategy or casting this strategy as an unethical act and create a discussion post with your viewpoints as to why you feel this is a valid strategy or is unethical.

Initial Setup and Series A NewCo has a pre?money valuation of $12 million. Combined, the founder shares and employee options pool total 9 million shares. NewCo seeks a $6 million Series A investment, for which investors receive shares of preferred stock that are convertible to shares of common stock.

Q1: What is the price per share at this time?

Q2: How many shares of preferred stock do the Series A investors receive?

Q3: What is the conversion price? (i.e., when converting a share of preferred stock into common stock, how many shares of common stock does the Series A investor get, and what is its value?)

Q4: What is the total equity stake of the Series A investors?

Q5: What is the total equity stake of the founders & employee options?

Scenario 3: Anti?Dilution Protection Series A investors negotiated broad?based weighted average conversion price protection.  The company seeks $8M, and Series B investors demand 8M shares.

Q16: What is the conversion price of Series A investor shares immediately after the B?round?

Q17: What is the total equity stake of the Series B investors?

Q18: What is the total equity stake of the Series A investors?

Q19: What is the total equity stake of the founders & employee options?