How to do a value stream map (VSM) of the customer ordering process for the X-opoly scenario?

X-Opoly, Inc., was founded by two first-year college students to produce a knockoff real estate board game similar to the popular Parker Brothers; game Monopoly®. Initially, the partners started the company just to produce a board game based on popular local landmarks in their small college town, as a way to help pay for their college expenses. However, the game was a big success and because they enjoyed running their own business, they decided to pursue the business full-time after graduation.

X-Opoly has grown rapidly over the last couple of years, designing and producing custom real estate trading games for universities, municipalities, chambers of commerce, and lately even some businesses. Orders range from a couple of hundred games to an occasional order for several thousand. This year X-Opoly expects to sell 50,000 units and projects that its sales will grow 25 percent annually for the next five years.

X-Opoly’s orders are either for a new game board that has not been produced before, or repeat orders for a game that was previously produced. If the order is for a new game, the client first meets with a graphic designer from X-Opoly’s art department and the actual game board is designed. The design of the board can take anywhere from a few hours to several weeks, depending on how much the client has thought about the game before the meeting. All design work is done on personal computers.

After the client approves the design, a copy of the computer file containing the design is transferred electronically to the printing department. Workers in the printing department load the file onto their own personal computers and print out the board design on special decals, 19.25 inches by 19.25 inches, using high-quality color inkjet printers. The side of the decal that is printed on is usually light gray, and the other side contains an adhesive that is covered by a removable backing.

The printing department is also responsible for printing the property cards, game cards, and money. The money is printed on colored-paper using standard laser printers. Ten copies of a particular denomination are printed on each 8.5-inch by 11-inch piece of paper. The money is then moved to the cutting department, where it is cut into individual bills. The property cards and game cards are produced similarly, the major difference being that they are printed on material resembling posterboard.

In addition to cutting the money, game cards, and property cards, the cutting department also cuts the cardboard that serves as the substrate for the actual game board. The game board consists of two boards created by cutting a single 19-inch by 19.25-inch piece of cardboard in half, yielding two boards each measuring 19.25 inches by 9.5 inches. After being cut, game boards, money, and cards are stored in totes in a work-in-process area and delivered to the appropriate station on the assembly line as needed.

Because of its explosive growth, X-Opoly’s assembly line was never formally planned. It simply evolved into the 19 stations shown in the following table.

Once you have the dataset, please use knowledge gained in other business and/or economics classes to realize what topic and theory the data could relate and a research question that it could allow you to answer. More specifically, please put together an analysis by making sure your project report includes the following:

1. Brief statement of the research topic and problem. As you get the dataset from me, you would need to use some imagination what research problem that data could be related to. Nevertheless, please state very briefly (i.e. in one paragraph) what theory (research literature or textbooks related to business or economics) says about the research problem – e.g. is there some dilemma or controversy that your research will help to clarify.
2. Clearly worded research question that limits the research problem to researchable task. (This is a short sentence that ends with the question mark and it is suggested that you draw from theory (research literature / textbook knowledge) in one of the business studies field to word it!)
3. Please identify the type of data that you are working with – on what type of measurement scale(s) where the selected variables measured by the original data collectors. (As you work with the dataset given by me, use your educated guess).
4. Describe the data with the tools of descriptive statistics, using both numerical as well as graphical methods. In addition to reporting and commenting on the values central tendency and diagrams, please also justify the choice of method (e.g. why a particular kind of measure of central tendency was selected and the chosen graphic is appropriate to use in this context).
5. Justify the selection of the specific data analysis method of inferential statistics. Recommendation – use the decision tree (introduced in Ch. 9ff) to make the selection and justification of it. You should look up also the assumptions and comment how your data meets them but I will not penalize you if it does not meet all the criteria. Nevertheless, please make sure that you include the basic information about distribution of the variables – are they more or less normally distributed (use both numerical as well as graphical methods). It is required that you restrict the choice of data analysis method(s) to the ones introduced in the class. (In addition to the fact that we covered only the most basic / frequently used methods in class, also the spreadsheet program (Excel) which the textbook is based on and that I presented during the course, has limited set of methods available).
6. Formulate the null and research (alternative) hypothesis – similarly to point 2 it is recommended that you word them on the basis of research literature / textbook knowledge in one of the business studies field that you know);
7. Determine the test criteria:

7.1. Specify the level of significance (Type I error associated with the null hypothesis),

7.2. Determine the test statistic (the appropriate statistical test as mentioned under point 5 above),

7.3. Determine the critical values (and region(s) if applicable),

8. Calculate the value of the test statistic (obtained value).
9. Make a decision about the null and research hypothesis by comparing the obtained value to the critical value and interpret the results of the data. You can pay attention also to the p-values.
10. Sum up you research report by relating the statistical test result(s) to the research question and theory that you set to test.

Father, Son and Gum; As other dynasties fade, a fourth-generation CEO shakes up Wrigley by tossing out his dad's rule book.

IN 1995, WILLIAM WRIGLEY JR. approached his father with a bold idea: The family-run company, after dominating the chewing-gum business for a century, should start selling mints. His father, who had successfully run Wm. Wrigley Jr. Co. for more than three decades, turned him down. "We know gum," the son recalls his father saying.

Family dynasties running big public companies over several generations are a vanishing breed. But William Wrigley Jr., who took over the business in 1999 after his father's unexpected death, has managed to turn around a company whose sales had stagnated and whose staff was steeped in doing things in the ultra-conservative manner of his father. At 35 years old, Mr. Wrigley set out to reinvent an iconic company while battling the legacy of his dad, a tough boss who had rejected many of his ideas over the years.

Since then, Mr. Wrigley has transformed the company from a cautious purveyor of Doublemint and Juicy Fruit into one of the fastest-growing publicly traded food companies. For the first time in decades, Wrigley is buying competitors, taking on debt and pouring money into research. After introducing few products in the 1990s, the company launched 72 last year alone, including cappuccino-flavored gum and sour gummy Life Savers. It purchased Altoids mints, is thinking about chocolate and patented chewing gum for dogs. "I don't rule anything out," says Mr. Wrigley.

While some of his ventures have flopped, Wrigley has performed well in the seven years since he took over. Sales have more than doubled, to $4.16 billion last year, profits have increased 68% overall and the company's stock has risen about 45%. Some analysts worry that the company's moves to diversify could shift its focus from the $15 billion world-wide gum market, where Wrigley is the top player.

Mr. Wrigley, now 42, has also hired outsiders for top positions, eased the dress code and encouraged employees to take risks -- things that didn't happen under his father. As long as his father was at the center of the company, "I was going to get stopped from getting any further into the center or we were going to collide like two neutrons or atoms in an accelerator," says Mr. Wrigley. "That is one of the biggest challenges for family businesses," he says. "When to step aside and how to step aside."

Ford Motor Co. and J.M. Smucker Co. are run by the great-grandsons of the founders, but many older family business dynasties are dying out as the third and fourth generations decide not to take over. Children don't feel as close to the founder as time passes, and increasingly independent boards are demanding broader sets of skills for leaders.

The Wrigley family helped build Chicago and remains one of its best- known dynasties. Wrigley's Michigan Avenue headquarters is one of the city's landmark buildings and the family's name is on everything from the Chicago Cubs baseball stadium to the Wrigleyville neighborhood to part of the new Millennium Park.

Yet growing up, Mr. Wrigley tried to conceal his identity, by introducing himself with just his first name. "Introducing yourself as Bill Wrigley was way more of a liability," he says. "Most people would think it's terrific. But people instantly look at you differently, judge you, and say, 'Oh here's this real wealthy person' or something, 'and he's going to be full of himself.' "

Although Mr. Wrigley shut down the company's 94-year-old gum plant on Chicago's south side last year, he simultaneously opened a $45 million research and development center in the city that's helped revitalize the Goose Island area and is bringing in white-collar jobs. Wrigley, which has had gum factories overseas since the 1920s, still makes gum at a facility in Yorkville, Ill.

Through trusts, Mr. Wrigley controls more shares of the company than any other investor, with about 15% under his beneficial ownership. The company won't say how many shares are held by the entire Wrigley clan. A divorced father of three, Mr. Wrigley is the only family member at Wrigley. His older sister and brother have never worked at the company. The family has been intensely private for decades, and Mr. Wrigley grants few interviews.

The first William Wrigley Jr. was 11 years old when, in 1872, he ran away from Philadelphia to New York, where he hawked newspapers and slept on the street, according to a 1920 article in American Magazine. Years later he went to Chicago to peddle soap, then baking powder, to shop owners. To entice them, he gave away two packages of chewing gum with each can of baking powder. When the gum became more popular, he started selling that instead. Soon he was making his own gum. Juicy Fruit hit shelves in 1893. To build sales, Mr. Wrigley twice gathered every phonebook in the country and mailed each person listed four sticks of chewing gum, according to the article, which the company cites. By 1920, he was making nine billion sticks of gum a year and had become the world's largest advertiser of a single product. In 1923, the company went public.

The Great Depression nudged the company in a more cautious direction under the founder's son, Philip Wrigley. (He was the company's only leader who wasn't named William.) When Philip's son, William Wrigley, took over as chief executive in 1961, he increased sales by pushing into Europe and Asia. But Wrigley stood by as Warner-Lambert Co. took the lead in sugarless gum with Trident in the 1960s.

The current William Wrigley Jr. grew up watching his father go to work at the company's white terra cotta headquarters in Chicago. When he was 5, his parents divorced. At 10, he moved to Arizona with his mother and siblings, where he swam competitively. He was a B student in private school. As a teen, he lived with his father during the summers and worked at the company, driving to the office with his father. On weekends, he water-skied with his dad at the Wrigley estate in Lake Geneva, Wis.

One summer, the younger Mr. Wrigley donned a white lab coat to mix test batches of Extra sugarless gum. At Duke University, where he studied economics, he read company memos mailed to him by his father. But he didn't go to work at Wrigley right away. He wanted to create something of his own. "I've always liked the idea of being an entrepreneur," Mr. Wrigley says. He'd grown up intrigued by the adventurous tales he heard about his great-grandfather, the company founder. "Those genes maybe skipped a couple generations and popped up again."

After graduating, he moved to Seattle to help a friend launch a three-person business selling stain remover. His father gave his reluctant blessing, Bill Jr. says. Bill Jr. set himself up in the frozen-foods aisle of supermarkets to demonstrate the stain remover on a carpet sample. Soon, working at Wrigley seemed more exciting. He returned to Chicago in 1985 as his father's assistant.

The elder Wrigley was a formal man whom nearly everyone, even friends, called "Mr. Wrigley." He was called that until he died, even though by the 1990s, many top executives were much more informal. Yet Mr. Wrigley warmed employees by remembering their birthdays and shaking hands with workers at factories, recalls Dushan Petrovich, Wrigley's chief administrative officer.

Fanatical about details, Mr. Wrigley once flew a Chicago designer to meet him at Wrigley's Prague office in order to match the shade of blue in the carpet there with the floors at headquarters. He insisted on screening casting tapes for the new Doublemint twins, to find actors with the right look. "He didn't get challenged a whole lot," Bill Jr. says. "It was sort of 'This is what Mr. Wrigley wants and so let's go find a character with a shorter haircut.' "

When the younger Mr. Wrigley took a top job at Wrigley's Canadian division in 1990, he set out to change the recipes and packaging for Juicy Fruit, Doublemint and Spearmint. Sales in Canada were falling and the formulas had hardly changed in decades. He also proposed launching a pellet-shaped sugarfree gum, which was selling well for Wrigley in Europe.

His father quickly nixed the packaging and recipe changes because he said they could alienate longtime customers, Bill Jr. recalls. The elder Wrigley balked at pellet gum, too, because it required costly new packaging equipment. Bill Jr. pressed, lobbying over lunch in his father's regular booth at the company's private restaurant. His father gave in. Excel pellets eventually became Wrigley's best- selling product in Canada. Bill Jr. doesn't recall his father congratulating him. "That just wasn't his style," he says.

In the mid-1990s, Altoids and other strong-tasting mints began gaining space in the candy aisle. Bill Jr. prodded his father to buy Frisk, a Belgian maker of zippy peppermints. Wrigley already had vast global merchandising and distribution. It could plug in the mints and increase sales, Bill Jr. figured. But his father thought "intense" mints were a fad. Besides, he told his son, there was still room to grow in gum. Italian competitor Perfetti Van Melle bought Frisk instead in 1995.

By the late 1990s, as the elder Mr. Wrigley reached his mid-60s, Bill Jr. began asking about his own future. The elder Mr. Wrigley didn't want to talk about succession. And he rarely commented on whether his son was doing a good job, Bill Jr. says. "I never felt that confidence from him." Frustrated, he began thinking about leaving Wrigley.

Howard Bernick, the departing Alberto-Culver Co. CEO who now sits on Wrigley's board, recalls the elder Mr. Wrigley thinking his son wasn't ready yet to take over and saying, " 'I just wish he was a little bit older.' "

Mr. Wrigley's father "had no doubt that he was going to be the next leader," says Richard Smucker, co-chief executive of jam maker J.M. Smucker and a Wrigley director. He just "leaned over backward a little bit not to express that" so people wouldn't think of his son as "the fair-haired boy." Mr. Smucker knows the issue of family business dynasties well, also being the great-grandson of a company founder. "Any family member has to work harder," he says.

The younger Mr. Wrigley was working in Europe in January 1999 when his father slipped on ice at the family estate in Wisconsin and broke his hip. Since his father was going through a divorce with his third wife at the time, Bill Jr. stepped in to take care of him, helping him run meetings from his home. What seemed a mild injury grew serious as his frail condition magnified other health problems. Nevertheless, the elder Wrigley insisted on running the annual shareholder meeting that March.

His condition took a turn for the worse. Bill Jr. sent the company jet to fetch his dad's doctor, who was away in Arizona. It was the first time anyone had dispatched the plane without his father's permission. "Don't worry," Bill Jr. told his father as he sat on his hospital bed. "I'm going to take care of everything." He says his father told him that he loved him.

By the next morning, the elder Mr. Wrigley had slipped into a coma. Terrified, Bill Jr. led the annual meeting for the first time. Days later, Wrigley's board named him acting president. He went to the hospital to tell his father, who was unresponsive in the coma. Mr. Wrigley died the next day, of complications from pneumonia. "Once he knew that I was going to run the company, I think he said, 'OK, now it's time for me to go,' " Bill Jr. says.

Ten days later, William Wrigley Jr. became the fourth chief executive of the company, following his father, grandfather and great- grandfather. Wall Street immediately questioned whether he had enough experience. Although the company had been largely successful during his father's tenure, when Bill Jr. took over, its U.S. gum sales had been flat for about five years.

Sorting through his father's office, Mr. Wrigley was shocked to find in his in-box a question on what color to make the carpet on the 12th floor. "I don't want to make this decision," Mr. Wrigley recalls thinking. "And I don't want anyone who reports to me to make this decision." He turned his father's office into a conference space.

He started making other changes. Some were little, like lifting the ban on using voice-mail during business hours and loosening the dress code from coats and ties to "business-appropriate" attire.

Other changes were bigger, like creating the company's first-ever strategic plan, and hiring top managers from Gillette Co. and Procter & Gamble Co., breaking a tradition of promoting from within. He also ordered the new packaging and recipes for Doublemint and other standards that his father had rejected.

Sitting in a church before a friend's wedding, Mr. Wrigley scrawled on a card: "Wrigley brands woven into the fabric of everyday life around the world." He says he intentionally left out "gum" so the statement would stay relevant as the company expanded into candy. Today, his scribbling has become the company's vision statement.

Mr. Wrigley says he isn't trying to change Wrigley's values -- or its emphasis on chewing gum, a retail standard in the checkout line. Gum accounts for 90% of Wrigley's sales. "We see great growth in chewing gum," Mr. Wrigley says. "But then it was also just logical to say 'Well, what else is up at the front end there? Who else are we competing with? And why can't we do some of that too?' "

When Mr. Wrigley took over, there was "an unleashing of a lot of energy," says Mr. Petrovich, who also worked for his father. But some employees bristled at the changes in style. Managers fumbled over the new dress code, some not exactly sure what kind of shoes were allowed. A company-described "breakthrough" training session, that emphasized stretching and drinking water, was dismissed by some employees as a new-age fad, executives say. In a meeting shortly after Mr. Wrigley took over, someone mentioned a new initiative he knew nothing about. The people "looked at me like I was on the moon," he recalls, "because in the past, anything that happened, the CEO knew about."

He sent workers an email that said, "If we never make mistakes, then we are most likely not being very innovative and not taking enough risks." He made his own mistakes. He thought gum could be a vehicle for medicine, so Wrigley invested more than $10 million to start a health-care division that launched Surpass, a chewing gum infused with antacid. Wrigley couldn't persuade stores to stock it at the checkout counter, and finally pulled it off the market in 2003.

What might have been his biggest gamble never materialized. In 2002, he says he got a message to call Richard Lenny, Hershey's CEO. Mr. Lenny said the trust that controls Hershey wanted to sell the candy maker. Would Wrigley consider a bid? Wrigley hadn't bought a company in half a century and didn't even carry debt on its balance sheet at the time. "Absolutely," Mr. Wrigley said.

Board members weren't so sure about a deal that huge. Mr. Bernick says he thought Mr. Wrigley should "hit singles" instead of swinging for homers. His father "wouldn't have done that deal," Mr. Smucker says. Mr. Wrigley eventually convinced the board, and Wrigley beat Nestle SA and Cadbury Schweppes PLC with its $12.5 billion bid. But the Hershey trust got cold feet amid community and political pressure and called off the sale at the last minute.

Getting so close to a big deal made Mr. Wrigley more determined to move into candy. He told workers to internally start calling the company the Wrigley Confectionery Co. In 2004, Wrigley expanded into lollipops and chewy candy by buying assets from the Joyco arm of Agrolimen, a Spanish food conglomerate. Later that year, Wrigley paid $1.48 billion for Altoids, Life Savers and other candy brands from Kraft Foods.

Wrigley is looking at more acquisitions and, at its new research center, scientists are searching for the next big candy. New products now account for 17% of sales, up from less than 6% during the late 1990s. Executives won't be specific about what is in the works, but "chocolate is within our playing field," says Surinder Kumar, Wrigley's chief innovation officer.

Some analysts say Wrigley may have overpaid for Kraft's brands and that weak sales of Altoids aren't a good sign. Mr. Wrigley says sales are within expectations. And some of Wrigley's new products haven't panned out. In addition to closing its health-care division, the company has pulled back on breath-freshening strips amid strong competition from Pfizer Inc.'s Listerine brand.

In his office, Mr. Wrigley keeps a picture of his father huddled with his dogs. In some ways, he says, it was better that his father wasn't there when he took over the company. "Maybe the silver lining in the whole thing is that maybe he realized it would have been difficult to coexist with different styles in the business," Mr. Wrigley says. His father's passing "was a graceful exit, although, to put it mildly, hugely unfortunate to lose your father at 66," he says.

He wishes his father were alive to see how he's made Wrigley grow. "My only regret is that I don't have my father side by side, or even off relaxing or retiring on some island, to be able to share it with."

While Mr. Wrigley says he never felt overt pressure from his dad to take over the business, "you kind of know there's a legacy there. You know your family's been in this business since 1891, and there's been a sequence of generations running the company." Mr. Wrigley says he "tried to push that into the background and leave options open to me in terms of what I might be interested in doing . . . .And at the end of the day, the reason I did come back to the business is because it was just darn interesting."

He isn't insisting that his children follow his career path. "You get so much influence from your parents," he says. "The important thing is for us to kind of get out of the way and make sure that we don't try and force them into doing something we wanted to do."

Questions:

1) What changes did he make after assuming leadership?

2) What were the challenges he faced as the new leader?

Today is November 1, 2020. You, CPA, have just been hired by Custom Auto Parts (CAP) as an accountant to provide financial expertise during its current expansion. CAP was founded in 1995 by Jerome Blackman (sole shareholder), and CAP has remained a private corporation ever since. From its humble beginnings, CAP has grown substantially. CAP's operations focus on the production of both standard and unique car parts. CAP always strives to use modern technology to produce quality car parts. When CAP commenced, it produced car parts for Canadian automotive companies that were seeking to outsource their production. Soon after, as word spread on the quality of its parts, CAP's products were being sought after by companies outside of Canada. In addition, CAP began selling its to individuals who were looking for unique car parts to restore older cars.

As a car buff, you are very excited about the position as it allows you to apply your accounting knowledge in an industry that interests you. On your first day, you met with CAP's CFO, Robert Ryder. Robert begins by explaining how excited he is that you have joined CAP's team and he looks forward to the expertise that you will bring to CAP's accounting department.

Robert continues by explaining that as CAP has grown, so has its on external financing. Just this year, CAP had purchased additional equipment to handle its recent growth. CAP has had a long-standing relationship with its bank. However, given the recent credit crisis, the bank has changed its policies on all loans. Robert has provided you with a copy of CAP's statement of financial position (see Exhibit I) as at October 31, 2020, which is CAP's fiscal year-end date.

Exhibit I ( CAP's FINANCIAL POSITION)

                                                                      Custom Auto Parts

                                                               Statement of Financial Position

                                                                      as at October 31

Assets

current assets 2020                      2019

Cash $ 35,000 $ 20,000

Accounts receivable 13,000 10,000

Inventory 20,000 12,000

Prepaids 3,000 3,000

  Total current assets 71,000 45,000

Property, plant, and equipment (net) 2,800,000 2,200,000

Total assets 2,871,000 2,245,000

Liabilities

Current liabilities

      Accounts payable 25,000 20,000

      Notes payable 13,000 25,000

  Current portion of long-term debt 150,000 50,000

188,000 95,000

Long-term debt 1,800,000 1,450,000

Total liabilities   1,988,000 1,545,000

Shareholders's equity

        Share capital 100 100

        Preferred shares 100,000 100,000

        Retained earnings 782,900 599,900

Total equity    883,000   700,000

Total liabilities and shareholders equity    $2,871,000 $2,245,000

                                           Debt equity    2.67 2.21

After the meeting, Robert asks you to analyze the new accounting issues surrounding CAP and to provide recommendations on their resolution. He concludes by reminding you that the bank is eager to see the year-end financial statements. As you make your way back to your desk, you begin by reviewing a file outlining important transactions undertaken by CAP. You note the following issues:

1.      On November 1, 2019 (the beginning of the fiscal year), CAP acquired a of its equipment through a lease agreement with Lessor Corp. The lease contract has the following terms and conditions:

·        CAP agrees to lease equipment from Lessor Corp. with a fair market value of $900,000

·         The term of the lease is for seven years, with annual rental payments of $145,000 due at the beginning of each year. CAP knows the implicit interest rate on the lease agreement is 5%. CAP knows that it could borrow at an incremental rate of 6%.

·        There is no residual value.

·        CAP will cover the executory costs associated with the lease. The executor costs will be approximately $10,000 per annum and are included as part of the $145,000 rental payment.

·        The lease offers a bargain purchase option to purchase the equipment for $50,000 at the end of the seventh year. At the end of year seven, the fair market value of the asset is expected to be $70,000.

·        The first payment was made on November 1, 2019, with annual payments thereafter. You remember from auditing a client in the past that equipment such as this usually has an economic life of nine years. CAP has classified this lease as an operating lease. You remember from your discussion with Robert that he was unsure of the benefits of leasing versus buying an asset. This information is for Robert for any future capital budgeting decisions.

2.       After reviewing the statement of financial position, you notice that there are preferred shares valued at $100,000, which equals a total of 1,000 shares outstanding. The preferred shares are redeemable and have a 5% annual dividend. The dividend will double every three years up to a maximum 20% dividend yield. The preferred shares convertible into common shares if CAP does not pay the specified dividend on the preferred shares.

3.      The file also contained a letter from CAP's lawyer (Stonechild, Pilla, and Partners). The letter from the lawyers explained a current lawsuit undertaken against CAP. Apparently, a customer had asked for 50,000 parts to be produced and delivered no later than July 15, 2020. However, due to major downtime in July, CAP could not produce the parts as scheduled. In turn, the customer was late in delivering its vehicles to its distributors and had to pay a penalty equivalent of $600,000. This customer is now suing CAP for retribution for these costs. The letter goes on to state that retribution will be inevitable; however, it is believed that a settlement between $350,000 to $550,000 can be reached.

4.      On November 1, 2019, an additional $500,000 of long-term loan was taken out to help finance the purchase of certain manufacturing equipment for $600,000. (Note: the additional $100,000 was paid for with cash.) Given this new loan and CAP's revised debt load, CAP must now maintain a maximum debt to equity ratio of 3:1 and its financial statements must comply with ASPE. If CAP breaches the covenant, the bank has the ability to call for the loan in full.

The manufacturing equipment that was purchased during the year will be depreciated over 10 years. It is classified as class 39 and has a CCA rate of 25%. CAP is taxed at the highest rate of 45%, and the half-year rule applies. Robert explained that CAP has not taken any consideration for potential tax consequences on the equipment purchase. (Note: for simplicity, assume that all other future tax considerations have been properly addressed.)

After reviewing this information, you realize that you have much to contemplate as to how these issues should dealt with.

Required

Provide a report to Robert outlining your recommendation on the accounting issues and note other important issues.

Discussion Case: Fidelity Investments’ Partnership with Citizen Schools

Roy Fralin stood in front of a roomful of active sixth and seventh graders in an inner-city public school in Roxbury, Massachusetts. The classroom walls were covered with flip chart paper, which were packed with diagrams, numbers, and terms like “savings,” “budget,” and “investment.” A student stood at the front of the classroom. Fralin handed him a baseball cap to illustrate a loan with interest. “OK, when you give it back, you’ll owe me how much?” Another student shouted out the answer. “Great!” exclaimed Fralin. They exchanged high fives. “Now, how much are we putting away for your 401(k)?” The students punched their handheld calculators.

Fralin was not a public school teacher, and teaching personal finance to middle schoolers was not his regular job. He was a vice president and investment advisor at Fidelity Investments, where he worked mostly with high net-worth clients. But here he was, every Wednesday afternoon for 10 weeks, teaching a curriculum that Fidelity employees had developed called “How to Invest Like a Millionaire.” The program was part of a partnership between an innovative nonprofit called Citizen Schools and Fidelity Investments, one of its corporate partners. “I just don’t see any downside,” Fralin later reflected in a clip posted to YouTube about his experience as a citizen teacher. “I think this is going to be a success.”

In June 2015, Fidelity Investments was one of the leading providers of financial services in the world, administering $5.2 trillion in assets for 24 million individual and institutional clients. The company, which was privately owned, offered investment management, retirement planning, portfolio guidance, brokerage, and benefits outsourcing services. It also operated its own family of mutual funds. Fidelity maintained its headquarters in Boston, Page 415but had 10 regional operating centers and about 180 retail locations. In 2015, the firm employed 41,000 associates.

In 2009, Fidelity set about rethinking its approach to community relations. For many years, the firm had been philanthropically active, giving to a wide range of charities in its home community and elsewhere. But the company had come to believe that it could have a greater impact by focusing on partnerships with a small number of what it called “best in class” nonprofit organizations. An issue of particular concern to Fidelity was education, especially the shocking dropout rates in many of the communities it served; nationally, 1.2 million students dropped out of high school every year, many of them as early as ninth grade. In researching various options for making a difference, the company learned that the middle school years were critical in determining whether or not students would go on to graduate from high school.

To focus its resources on this issue, Fidelity chose to partner with Citizen Schools (CS). Social entrepreneur Eric Schwarz had founded CS in 1995 in Boston to operate after-school programs for middle school students, aged 11 to 14, in disadvantaged communities. The nonprofit recruited volunteer professionals—“citizen teachers”—to offer after-school apprenticeships in subjects they were passionate about in schools in the CS network. As a culminating experience, students would present what they had learned to friends, family, and teachers at what CS called “WOW!” events. In 2015, Citizen Schools had active partnerships with 29 schools in low-income communities in seven states, serving more than 4,800 students.

Fidelity had contributed money to Citizen Schools since 1998, but in 2009 it significantly stepped up its commitment and the company went beyond charity, encouraging its employees, like Roy Fralin, to teach in Citizen School programs. By 2015, Fidelity volunteers had taught more than 180 apprenticeships in such wide-ranging topics as robotics, law, and financial literacy in 34 middle schools. More than 1,500 associates had volunteered over 20,000 hours of volunteer service. Several executives served on various advisory boards. The company also donated meeting space and equipment. For example, students who had learned about web design from a Fidelity employee were invited to use the Fidelity Center for Applied Technology for their WOW! event, presenting their work in a state-of-the-art facility.

An external evaluation commissioned by Citizen Schools showed that its programs had “successfully moved a group of low-income, educationally at-risk students toward high school graduation and advancement to college, and [had] set them up for full participation in the civic and economic life of their communities.” Seventy-one percent of Citizen Schools alumni completed high school in four years, compared with 59 percent of matched peers. Sixty-one percent of students who had participated in their 8GA (8th Grade Academy) program five or more years earlier had enrolled in college, compared with 41 percent of low-income students nationally.

Fidelity indicated that in an internal survey, 89 percent of the company’s employees who had participated in the Citizen Schools partnership reported feeling more connected to their colleagues, 78 percent reported improved team-building skills, and over three-quarters reported having improved communication skills. Most importantly though, Heidi Siegal, Fidelity’s vice president for community relations, noted, “Our employees and our company enthusiastically support Citizen Schools because we know that they make a unique and significant impact on the lives of students in need.”

Sources: Corporate Voices for Working Families, “Fidelity Investments” (case study), 2012, at http://employmentpathwaysproject.org/wp-content/uploads/2014/04/Fidelity-and-Citizen-Schools-5.9.12.pdf; “Fidelity Investments,” at www.citizenschools.org/investors/current-investors/fidelity-investments; “Teaching Kids to Invest Like Millionaires,” [Roy Fralin], at www.youtube.com; “Guest Blog: At Citizen Schools, Volunteers Make STEM Relevant through Web design,” at www.educationnation.com; and private correspondence with representatives of Fidelity Investments and Citizen Schools. The website of Citizen Schools is at www.citizenschools.org. The website of Fidelity Investments is at www.fidelity.com.

Page 416

Discussion Questions

1. What evidence do you see in this case of the three kinds of corporate philanthropy discussed in this chapter: contributions of cash, in-kind products or services, and employee time?

2. What are the benefits and risks to Fidelity Investments of its partnership with Citizen Schools?

3. Do you consider Fidelity Investment’s partnership with Citizen Schools to be an example of strategic philanthropy, as defined in this chapter? Why or why not?

4. If you were a community relations manager for Fidelity Investments, how would you evaluate the impact of this partnership? What kinds of impacts would you attempt to measure, and why?

Retrieve the names of employees whose salary is within $20,000 of the

salary of the employee who is paid the most in the company (e.g., if the highest

salary in the company is $80,000, retrieve the names of all employees that make at

least $60,000)

Based on the following table:

-- drop tables

DROP TABLE EMPLOYEE CASCADE CONSTRAINTS;
DROP TABLE DEPARTMENT CASCADE CONSTRAINTS;
DROP TABLE DEPT_LOCATIONS CASCADE CONSTRAINTS;
DROP TABLE PROJECT CASCADE CONSTRAINTS;
DROP TABLE WORKS_ON CASCADE CONSTRAINTS;
DROP TABLE DEPENDENT CASCADE CONSTRAINTS;

-- create and populate tables

CREATE TABLE EMPLOYEE
(
   Fname       VARCHAR(20),
   Minit       CHAR(1),
   Lname       VARCHAR(20),
   Ssn       CHAR(9),
   Bdate       DATE,
   Address       VARCHAR(30),
   Sex       CHAR(1),
   Salary       NUMBER(5),
   Super_Ssn   CHAR(9),
   Dno       NUMBER(1),

   PRIMARY KEY (Ssn),
      
   FOREIGN KEY (Super_ssn)
       REFERENCES EMPLOYEE (Ssn)
);

INSERT INTO EMPLOYEE VALUES ('James', 'E', 'Borg', '888665555', DATE '1937-11-10', '450 Stone, Houston, TX', 'M', 55000, NULL, 1);
INSERT INTO EMPLOYEE VALUES ('Jennifer', 'S', 'Wallace', '987654321', DATE '1941-06-20', '291 Berry, Bellaire, Tx', 'F', 37000, '888665555', 4);
INSERT INTO EMPLOYEE VALUES ('Franklin', 'T', 'Wong', '333445555', DATE '1955-12-08', '638 Voss, Houston, TX', 'M', 40000, '888665555', 5);
INSERT INTO EMPLOYEE VALUES ('John', 'B', 'Smith', '123456789', DATE '1965-01-09', '731 Fondren, Houston, TX', 'M', 30000, '333445555', 5);
INSERT INTO EMPLOYEE VALUES ('Alicia', 'J', 'Zelaya', '999887777', DATE '1968-01-19', '3321 castle, Spring, TX', 'F', 25000, '987654321', 4);
INSERT INTO EMPLOYEE VALUES ('Ramesh', 'K', 'Narayan', '666884444', DATE '1920-09-15', '975 Fire Oak, Humble, TX', 'M', 38000, '333445555', 5);
INSERT INTO EMPLOYEE VALUES ('Joyce', 'A', 'English', '453453453', DATE '1972-07-31', '5631 Rice, Houston, TX', 'F', 25000, '333445555', 5);
INSERT INTO EMPLOYEE VALUES ('Ahmad', 'V', 'Jabbar', '987987987', DATE '1969-03-29', '980 Dallas, Houston, TX', 'M', 22000, '987654321', 4);
INSERT INTO EMPLOYEE VALUES ('Melissa', 'M', 'Jones', '808080808', DATE '1970-07-10', '1001 Western, Houston, TX', 'F', 27500, '333445555', 5);

CREATE TABLE DEPARTMENT
(
   Dname       VARCHAR(20),
   Dnumber       NUMBER(1),
   Mgr_ssn       CHAR(9),
   Mgr_start_date   DATE,
  
   PRIMARY KEY (Dnumber),

   FOREIGN KEY (Mgr_ssn)
       REFERENCES EMPLOYEE (Ssn)
);

INSERT INTO DEPARTMENT VALUES ('Research', 5, '333445555', DATE '1988-05-22');
INSERT INTO DEPARTMENT VALUES ('Administration', 4, '987654321', DATE '1995-01-01');
INSERT INTO DEPARTMENT VALUES ('Headquarters', 1, '888665555', DATE '1981-06-19');

-- this alter is needed to allow PROJECT and DEPARTMENT to reference each other

ALTER TABLE EMPLOYEE ADD FOREIGN KEY (Dno) REFERENCES DEPARTMENT (Dnumber);

CREATE TABLE DEPT_LOCATIONS
(
   Dnumber       NUMBER(1),
   Dlocation   VARCHAR(20),
  
   PRIMARY KEY (Dnumber, Dlocation),

   FOREIGN KEY (Dnumber)
       REFERENCES DEPARTMENT (Dnumber)
);

INSERT INTO DEPT_LOCATIONS VALUES (1, 'Houston');
INSERT INTO DEPT_LOCATIONS VALUES (4, 'Stafford');
INSERT INTO DEPT_LOCATIONS VALUES (5, 'Bellaire');
INSERT INTO DEPT_LOCATIONS VALUES (5, 'Sugarland');
INSERT INTO DEPT_LOCATIONS VALUES (5, 'Austin');

CREATE TABLE PROJECT
(
   Pname       VARCHAR(20),
   Pnumber       NUMBER(2),
   Plocation   VARCHAR(20),
   Dnum       NUMBER(1),

   PRIMARY KEY (Pnumber),
  
   FOREIGN KEY (Dnum)
       REFERENCES DEPARTMENT (Dnumber)
);

INSERT INTO PROJECT VALUES ('ProductX', 1, 'Bellaire', 5);
INSERT INTO PROJECT VALUES ('ProductY', 2, 'Sugarland', 5);
INSERT INTO PROJECT VALUES ('ProductZ', 3, 'Houston', 5);
INSERT INTO PROJECT VALUES ('Computerization', 10, 'Stafford', 4);
INSERT INTO PROJECT VALUES ('Reorganization', 20, 'Houston', 1);
INSERT INTO PROJECT VALUES ('Newbenefits', 30, 'Stafford', 4);

CREATE TABLE WORKS_ON
(
   Essn       CHAR(9),
   Pno       NUMBER(2),
   Hours       NUMBER(3,1),
  
   PRIMARY KEY (Essn, Pno),

   FOREIGN KEY (Essn)
       REFERENCES EMPLOYEE (Ssn),

   FOREIGN KEY (Pno)
       REFERENCES PROJECT(Pnumber)
);

INSERT INTO WORKS_ON VALUES ('123456789', 1, 32.0);
INSERT INTO WORKS_ON VALUES ('123456789', 2, 8.0);
INSERT INTO WORKS_ON VALUES ('453453453', 1, 20.0);
INSERT INTO WORKS_ON VALUES ('453453453', 2, 20.0);
INSERT INTO WORKS_ON VALUES ('333445555', 1, 10.0);
INSERT INTO WORKS_ON VALUES ('333445555', 2, 10.0);
INSERT INTO WORKS_ON VALUES ('333445555', 3, 5.0);
INSERT INTO WORKS_ON VALUES ('333445555', 10, 10.0);
INSERT INTO WORKS_ON VALUES ('333445555', 20, 10.0);
INSERT INTO WORKS_ON VALUES ('333445555', 30, 5.0);
INSERT INTO WORKS_ON VALUES ('999887777', 30, 30.0);
INSERT INTO WORKS_ON VALUES ('999887777', 10, 10.0);
INSERT INTO WORKS_ON VALUES ('987987987', 10, 35.0);
INSERT INTO WORKS_ON VALUES ('987987987', 30, 5.0);
INSERT INTO WORKS_ON VALUES ('987654321', 30, 20.0);
INSERT INTO WORKS_ON VALUES ('987654321', 20, 15.0);
INSERT INTO WORKS_ON VALUES ('888665555', 20, 10.0);

CREATE TABLE DEPENDENT
(
   Essn       CHAR(9),
   Dependent_name   VARCHAR(20),
   Sex       CHAR(1),
   Bdate       DATE,
   Relationship    VARCHAR(10),

   PRIMARY KEY (Essn, Dependent_name),

   FOREIGN KEY (Essn)
       REFERENCES EMPLOYEE (Ssn)
);

INSERT INTO DEPENDENT VALUES ('333445555', 'Alice', 'F', DATE '1986-04-05', 'Daughter');
INSERT INTO DEPENDENT VALUES ('333445555', 'Theodore', 'M', DATE '1983-10-25', 'Son');
INSERT INTO DEPENDENT VALUES ('333445555', 'Joy', 'F', DATE '1958-05-03', 'Spouse');
INSERT INTO DEPENDENT VALUES ('987654321', 'Abner', 'M', DATE '1988-01-04', 'Son');
INSERT INTO DEPENDENT VALUES ('987654321', 'Jennifer', 'F', DATE '1988-01-04', 'Daughter');
INSERT INTO DEPENDENT VALUES ('123456789', 'John', 'M', DATE '1988-02-28', 'Son');
INSERT INTO DEPENDENT VALUES ('123456789', 'Alice', 'F', DATE '1988-12-30', 'Daughter');
INSERT INTO DEPENDENT VALUES ('123456789', 'Elizabeth', 'F', DATE '1967-05-05', 'Spouse');
INSERT INTO DEPENDENT VALUES ('453453453', 'Joyce', 'F', DATE '1990-04-05', 'Daughter');

-- display contents of tables

SELECT * FROM EMPLOYEE;
SELECT * FROM DEPARTMENT;
SELECT * FROM DEPT_LOCATIONS;
SELECT * FROM PROJECT;
SELECT * FROM WORKS_ON;
SELECT * FROM DEPENDENT;

Logan B. Taylor is a widower whose wife, Sara, died on June 6, 2016. He lives at 4680 Dogwood Lane, Springfield, MO 65801. He is employed as a paralegal by a local law firm. During 2018, he had the following receipts:

Logan inherited securities worth $60,000 from his uncle, Daniel, who died in 2018. Logan also was the designated beneficiary of an insurance policy on Daniel's life with a maturity value of $200,000. The lot in St. Louis was purchased on May 2, 2013, for $85,000 and held as an investment. Because the neighborhood has deteriorated, Logan decided to cut his losses and sold the lot on January 5, 2018, for $80,000. The estate sale consisted largely of items belonging to Sara and Daniel (e.g., camper, boat, furniture, and fishing and hunting equipment). Logan estimates that the property sold originally cost at least twice the $9,000 he received and has declined or stayed the same in value since Sara and Daniel died.

Logan's expenditures for 2018 include the following:

Logan and his dependents are covered by his employer's health insurance policy for all of 2018. However, he is subject to a deductible, and dental care is not included. The $10,500 dental charge was for Helen's implants. Helen is Logan's widowed mother, who lives with him (see below). Logan normally pledges $2,400 ($200 per month) each year to his church. On December 5, 2018, upon the advice of his pastor, he prepaid his pledge for 2019.

Logan's household, all of whom he supports, includes the following:

Helen receives a modest Social Security benefit. Asher, a son, is a full-time student in dental school and earns $4,500 as a part-time dental assistant. Mia, a daughter, does not work and is engaged to be married.

Federal income tax of $4,500 was withheld from his wages.

Complete Form 1040 below for Logan Taylor.

I need help with 11a where it says "Tax (see inst)," 11, 13-15, and 22.

Kindly write a one page summary of the content below including important details. Thank you.

Abstract Representing the 60 trillion cells that build a human body, a sperm and an egg meet, recognize each other, and fuse to form a new generation of life. The factors involved in this important membrane fusion event, fertilization, have been sought for a long time. Recently, CD9 on the egg membrane was found to be essential for fusion [1], but sperm-related fusion factors remain unknown. Here, by using a fusion-inhibiting monoclonal antibody [2] and gene cloning, we identify a mouse sperm fusion related antigen and show that the antigen is a novel immunoglobulin superfamily protein. We have termed the gene Izumo and produced a genedisrupted mouse line. Izumo −/− mice were healthy but males were sterile. They produced normal-looking sperm that bound to and penetrated the zona pellucida but were incapable of fusing with eggs. Human sperm also contain Izumo and addition of the antibody against human Izumo left the sperm unable to fuse with zonafree hamster eggs. Identification of Izumo To identify factors involved in sperm–egg fusion, we used a monoclonal antibody, OBF13, against mouse sperm that specifically inhibits the fusion process [2]. The antigen was identified by separation of the crude extracts from mouse sperm by two-dimensional gel electrophoresis and subsequent immunoblotting with the monoclonal antibody. We named the antigen ‘Izumo’ after a Japanese shrine dedicated to marriage. The identified spot was analyzed by liquid chromatography tandem mass spectrometry (LC–MS/MS), and ten peptides that were 100% identical to a part of the sequence listed in the RIKEN full-length database were found. The registered DNA sequence was confirmed by sequencing after polymerase chain reaction with reverse transcription (RT–PCR) with total RNA prepared from the testis. A human homologue was found as an unverified gene in the NCBI database. The gene encodes a novel immunoglobulin superfamily (IgSF), type I membrane protein with an extracellular immunoglobulin-like domain that contains one putative glycosylation site (Fig. 1a). Mouse Izumo was shown to be a testis (sperm)-specific 56.4-kDa antigen by western blotting with a polyclonal antibody raised against recombinant mouse Izumo (Fig. 1b). Izumo was also detectable as a 37.2-kDa protein by western blotting of human sperm with anti-human Izumo antibody (Fig. 1c). Izumo was not detectable on the surface of fresh sperm. Coinciding with the fact that mammalian sperm are incapable of fertilizing eggs when ejaculated and that fertilization occurs only after an exocytotic process called the acrosome reaction, both mouse and human Izumo became detectable on sperm surface only after the acrosome reaction (Fig. 1d, e). This would probably be because Izumo is not localized on plasma membrane of fresh spermatozoa but is hidden under plasma membrane and accessible after the acrosome reaction, as occurs with CD46 on mouse sperm [3]. Figure 1 Identification and characterization of Izumo. a, Izumo is a typical type I membrane glycoprotein with one immunoglobulin-like domain and a putative N-glycoside link motif (Asn 204). b, Izumo was detected exclusively in testis and sperm by western blotting. The tissues examined are, from left to right: brain, heart, thymus, spleen, lung, liver, muscle, kidney, ovary, testis and sperm. The arrowhead indicates mouse Izumo protein. c, Western blotting analysis of human Izumo protein from human sperm. The arrow indicates human Izumo protein. d, Immunostaining of Izumo in sperm from an acrosin-promoter-driven transgenic mouse line that has enhanced green fluorescent protein in the acrosome. Izumo was not detected in fresh sperm with intact acrosomes expressing EGFP (indicated by green arrows), but was revealed on acrosome-reacted (non-green fluorescent) sperm (stained red, shown by white arrowheads), when stained with the polyclonal antibody against mouse Izumo. e, Human sperm were also stained with polyclonal anti-human Izumo antibody (red). Acrosome-reacted human sperm (stained green with anti-CD46 antibody) were reactive to the antibody against human Izumo but the same antibody did not react to acrosome-intact (CD46-negative) sperm. Scale bar, 10 mm. 40 ANNUAL REPORT OF OSAKA UNIVERSITY—Academic Achievement—2004-2005 Establishment of Izumo-deficient mice To address the physiological role of Izumo in vivo we generated Izumo-deficient mice by homologous recombination. An Izumo targeting construct was designed to replace exons 2–10 with a neomycin-resistant gene (neor ). Both the targeting event in D3 embryonic stem cells and the germline transmission of targeted genes were confirmed by Southern blot analysis. In the homozygous mutant mice, the full-length messenger RNA and the Izumo protein were not detected. Because the disruption of a gene can cause a concomitant increase or decrease in some related genes, we examined CD46, sp56, CD55, CD147, and ADAM2, which were reported to be involved in sperm–egg interactions. We could not find a significant change in these protein levels in sperm after the deletion of Izumo gene. The fecundity of Izumo-deficient males Izumo −/−mutant mice were healthy and showed no overt developmental abnormalities. Izumo -/- females demonstrated normal fecundity. Izumo +/− males also showed normal fertilizing ability. However, Izumo −/− males were sterile despite normal mating behaviour and ejaculation, with normal vaginal plug formations. After observation of 28 plugs, nine pairs of Izumo −/− male and wild-type females were kept for another 4 months but no pregnancies were observed. In at least four different cases of gene knockouts that resulted in male sterility attributed to impaired zonabinding ability, the sperm also failed to migrate into the oviduct. However, disruption of Izumo did not cause any defect in sperm migration into the oviduct (data not shown, and there was no reduction of sperm motility in Izumo −/− sperm motility was measured 120 min after incubation by computer-aided sperm analysis (CASA; mean; s.e.m.=81.7±7.7% in Izumo +/− sperm and 77±8.9% in Izumo −/− sperm)). The sterile nature of Izumo −/− sperm was shown in the in vitro fertilization system (Fig. 2a). The impaired fertilization step undoubtedly followed zona penetration because sperm penetrated the zona pellucida and accumulated in the perivitelline space of the eggs (Fig. 2b). Fusion ability in Izumo-deficient sperm Syngamy can be considered to occur to two stages: binding of the sperm plasma membrane to that of the egg, and actual membrane fusion. Izumo −/− sperm were capable of binding to the plasma membranes of eggs whose zona pellucida had been mechanically removed [4] (Fig. 2c). In this system, the Izumo +/− sperm incubated for 2 and 6 h fused to eggs in approximate ratios of 4.5 and 6 sperm per egg, respectively, but no Izumo −/− sperm fused with eggs (Fig. 2c). Sperm can not fuse with eggs unless the former have undergone the acrosome reaction. To verify the acrosomal status of Izumo −/− sperm, we stained the sperm accumulated in perivitelline spaces with the MN9 monoclonal antibody, which immunoreacts only to the equatorial segment of acrosomereacted sperm [5]. The staining indicated that the Izumo −/− sperm had undergone the acrosome reaction (Fig. 2b) but failed to fuse with eggs. Development of eggs after intracytoplasmic sperm injection (ICSI) with Izumo-deficient sperm Because no offspring were fathered by Izumo −/− male mice, it was unclear whether the defect was limited to fusion or extended to later developmental stages. To address this question, we used ICSI to insert Izumo −/− sperm directly into the cytoplasm of wild-type eggs and bypass the fusion step. Eggs injected with Izumo −/− sperm were successfully activated and the fertilized eggs were transplanted into the oviducts of pseudopregnant females. The eggs implanted normally and the resulting embryos developed appropriately to term with rates similar to those of heterozygous mice. Human Izumo is also involved in sperm-egg fusion Sperm–egg fusion is known to be less species-specific than sperm–zona interaction. For example, human sperm can not penetrate the hamster zona pellucida but they can fuse with zona-free hamster eggs, and this system (zona-free hamster-egg sperm penetration test) has been used for the assessment of human sperm fertility. We first examined the contribution of mouse Izumo in a zona-free hamster-egg sperm penetration assay. As indicated in Fig. 3a, the mouse Izumo was essential not only in the homologous fusion system but also for heterologous fusion with hamster eggs. Similarly, when the anti-human Izumo polyclonal antibody was added to the incubation mixture, no fusion was observed, whereas the sperm treated with control IgG fused with eggs at an average of 5.9±0.7 sperm per egg. The total numbers of eggs observed were 23 and 29, respectively (n=3). These results indicated that human Izumo is involved in the fertilization process in human sperm (Fig. 3b). Rescued fertility of Izumo-deficient male by transgene The phenotypes of gene knockout mice are not always related Figure 2 Male infertility caused by Izumo disruption. a, In vitro fertilization of sperm from Izumo +/−and Izumo −/−mice. Unlike Izumo +/−, the eggs inseminated with Izumo −/− sperm had many sperm on their zona pellucida, owing to the failure of sperm–egg fusion that probably leads to the absence of zona-reaction to lessen the sperm-binding ability of the zona pellucida. b,Upper panel, accumulation of many sperm in the perivitelline space of the eggs recovered from the females mated with Izumo −/− males. Lower panel, sperm in perivitelline space labelled with acrosome reacted, spermspecific monoclonal antibody MN9. c, Fused sperm stained by Hoechst 33342 preloaded into the egg. The arrowheads show the fused sperm. to the disrupted genes but are sometimes caused by disruption of a neighbouring gene. To examine whether the phenotype was directly derived from the lack of Izumo on sperm, we performed a rescue experiment by crossing Izumo −/− mice with transgenic mouse lines generated to express Izumo by using the testis-specific calmegin promoter [6]. The sterile phenotype was rescued with the transgenically expressed Izumo on mouse sperm (Fig. 4). Discussion In the search for sperm surface proteins that function in sperm–egg plasma-membrane binding and fusion, various candidates such as DE, CD46, equatorin, Sperad and SAMP32 have been reported. ADAM family proteins are given the most attention for their possession of a putative fusion peptide (ADAM1) and disintegrin domain (ADAM2 and ADAM3). None of the mice possessing disrupted ADAM1a, ADAM2 and ADAM3 show a significant defect in the ability to fuse with eggs [7-9], but do show an impairment of sperm–zona binding ability. Similarly, CD46 disruption does not diminish fusion [3]. In contrast, CD9 on the egg surface is essential for the fusing ability of eggs [1] and some indications for the involvement of the binding of integrins to CD9 are postulated in reference to sperm–egg fusion. However, the disruptions of the most probable candidate integrin α6β1 cause no major influence on the fusing ability of eggs. Thus, for several years, postulated fertilization mechanisms were repeatedly changed as a result of gene disruption experiments. This suggests that the essential nature of the candidate gene must be judged after observing the phenotype of the gene-disrupted mice. In this context, Izumo is the first sperm membrane protein shown to be essential for fusion. It is not yet known whether sperm Izumo interacts with egg CD9, as occurs with placental IgSF protein PSG17; neither do we know why the localization of Izumo after acrosome reaction is not limited to the 41 Osaka University 100 Papers : 10 Selected Papers ANNUAL REPORT OF OSAKA UNIVERSITY—Academic Achievement—2004-2005 Figure 4 Transgene to express mouse Izumo under the control of calmegin promoter. a, The locations of primers A to E were indicated in this figure. b, lane 1; Izumo +/− mouse with intrinsic Izumo, lane 2 and 3; Izumo −/− mouse with transgenically expressed Izumo and Izumo His-tag, respectively. c, Litter size obtained by mating male mice with C57BL/6 wild-type mice. The group numbers are equal to those shown in b. The numbers in parentheses indicate the numbers of matings. References 1. Miyado, K. et al., Requirement of CD9 on the egg plasma membrane for fertilization. Science, 287, 321-4 (2000). 2. Okabe, M. et al., Capacitation-related changes in antigen distribution on mouse sperm heads and its relation to fertilization rate in vitro. J Reprod Immunol, 11, 91-100 (1987). 3. Inoue, N. et al., Disruption of mouse CD46 causes an accelerated spontaneous acrosome reaction in sperm. Mol Cell Biol, 23, 2614-22 (2003). 4. Yamagata, K. et al., Sperm from the calmegin-deficient mouse have normal abilities for binding and fusion to the egg plasma membrane. Dev Biol, 250, 348-57 (2002). 5. Manandhar, G. & Toshimori, K., Exposure of sperm head equatorin after acrosome reaction and its fate after fertilization in mice. Biol Reprod, 65, 1425-36 (2001). 6. Ikawa, M. et al., Calmegin is required for fertilin alpha/beta heterodimerization and sperm fertility. Dev Biol, 240, 254-61 (2001). 7. Cho, C. et al., Fertilization defects in sperm from mice lacking fertilin beta. Science, 281, 1857-9 (1998). 8. Nishimura, H., Cho, C., Branciforte, D. R., Myles, D. G. & Primakoff, P., Analysis of loss of adhesive function in sperm lacking cyritestin or fertilin beta. Dev Biol, 233, 204-13 (2001). 9. Nishimura, H., Kim, E., Nakanishi, T. & Baba, T., Possible Function of the ADAM1a/ADAM2 Fertilin Complex in the Appearance of ADAM3 on the Sperm Surface. J Biol Chem, 279, 34957-62 (2004). equatorial segment where fusion initially takes place. All we can say now is that continued study of this protein’s function will undoubtedly lead to a fuller understanding of the cell–cell fusion process in fertilization and perhaps in other somatic systems such as muscle cells or trophoblasts. The finding not only provides insight into the enigmatic fusion mechanism but also promises benefits in the clinical treatment of infertility and the potential development of new contraceptive strategies

Kindly write a two page summary of the content below including important details. Thank you. kindly paraphrase as well

Abstract Representing the 60 trillion cells that build a human body, a sperm and an egg meet, recognize each other, and fuse to form a new generation of life. The factors involved in this important membrane fusion event, fertilization, have been sought for a long time. Recently, CD9 on the egg membrane was found to be essential for fusion [1], but sperm-related fusion factors remain unknown. Here, by using a fusion-inhibiting monoclonal antibody [2] and gene cloning, we identify a mouse sperm fusion related antigen and show that the antigen is a novel immunoglobulin superfamily protein. We have termed the gene Izumo and produced a genedisrupted mouse line. Izumo −/− mice were healthy but males were sterile. They produced normal-looking sperm that bound to and penetrated the zona pellucida but were incapable of fusing with eggs. Human sperm also contain Izumo and addition of the antibody against human Izumo left the sperm unable to fuse with zonafree hamster eggs. Identification of Izumo To identify factors involved in sperm–egg fusion, we used a monoclonal antibody, OBF13, against mouse sperm that specifically inhibits the fusion process [2]. The antigen was identified by separation of the crude extracts from mouse sperm by two-dimensional gel electrophoresis and subsequent immunoblotting with the monoclonal antibody. We named the antigen ‘Izumo’ after a Japanese shrine dedicated to marriage. The identified spot was analyzed by liquid chromatography tandem mass spectrometry (LC–MS/MS), and ten peptides that were 100% identical to a part of the sequence listed in the RIKEN full-length database were found. The registered DNA sequence was confirmed by sequencing after polymerase chain reaction with reverse transcription (RT–PCR) with total RNA prepared from the testis. A human homologue was found as an unverified gene in the NCBI database. The gene encodes a novel immunoglobulin superfamily (IgSF), type I membrane protein with an extracellular immunoglobulin-like domain that contains one putative glycosylation site (Fig. 1a). Mouse Izumo was shown to be a testis (sperm)-specific 56.4-kDa antigen by western blotting with a polyclonal antibody raised against recombinant mouse Izumo (Fig. 1b). Izumo was also detectable as a 37.2-kDa protein by western blotting of human sperm with anti-human Izumo antibody (Fig. 1c). Izumo was not detectable on the surface of fresh sperm. Coinciding with the fact that mammalian sperm are incapable of fertilizing eggs when ejaculated and that fertilization occurs only after an exocytotic process called the acrosome reaction, both mouse and human Izumo became detectable on sperm surface only after the acrosome reaction (Fig. 1d, e). This would probably be because Izumo is not localized on plasma membrane of fresh spermatozoa but is hidden under plasma membrane and accessible after the acrosome reaction, as occurs with CD46 on mouse sperm [3]. Figure 1 Identification and characterization of Izumo. a, Izumo is a typical type I membrane glycoprotein with one immunoglobulin-like domain and a putative N-glycoside link motif (Asn 204). b, Izumo was detected exclusively in testis and sperm by western blotting. The tissues examined are, from left to right: brain, heart, thymus, spleen, lung, liver, muscle, kidney, ovary, testis and sperm. The arrowhead indicates mouse Izumo protein. c, Western blotting analysis of human Izumo protein from human sperm. The arrow indicates human Izumo protein. d, Immunostaining of Izumo in sperm from an acrosin-promoter-driven transgenic mouse line that has enhanced green fluorescent protein in the acrosome. Izumo was not detected in fresh sperm with intact acrosomes expressing EGFP (indicated by green arrows), but was revealed on acrosome-reacted (non-green fluorescent) sperm (stained red, shown by white arrowheads), when stained with the polyclonal antibody against mouse Izumo. e, Human sperm were also stained with polyclonal anti-human Izumo antibody (red). Acrosome-reacted human sperm (stained green with anti-CD46 antibody) were reactive to the antibody against human Izumo but the same antibody did not react to acrosome-intact (CD46-negative) sperm. Scale bar, 10 mm. 40 ANNUAL REPORT OF OSAKA UNIVERSITY—Academic Achievement—2004-2005 Establishment of Izumo-deficient mice To address the physiological role of Izumo in vivo we generated Izumo-deficient mice by homologous recombination. An Izumo targeting construct was designed to replace exons 2–10 with a neomycin-resistant gene (neor ). Both the targeting event in D3 embryonic stem cells and the germline transmission of targeted genes were confirmed by Southern blot analysis. In the homozygous mutant mice, the full-length messenger RNA and the Izumo protein were not detected. Because the disruption of a gene can cause a concomitant increase or decrease in some related genes, we examined CD46, sp56, CD55, CD147, and ADAM2, which were reported to be involved in sperm–egg interactions. We could not find a significant change in these protein levels in sperm after the deletion of Izumo gene. The fecundity of Izumo-deficient males Izumo −/−mutant mice were healthy and showed no overt developmental abnormalities. Izumo -/- females demonstrated normal fecundity. Izumo +/− males also showed normal fertilizing ability. However, Izumo −/− males were sterile despite normal mating behaviour and ejaculation, with normal vaginal plug formations. After observation of 28 plugs, nine pairs of Izumo −/− male and wild-type females were kept for another 4 months but no pregnancies were observed. In at least four different cases of gene knockouts that resulted in male sterility attributed to impaired zonabinding ability, the sperm also failed to migrate into the oviduct. However, disruption of Izumo did not cause any defect in sperm migration into the oviduct (data not shown, and there was no reduction of sperm motility in Izumo −/− sperm motility was measured 120 min after incubation by computer-aided sperm analysis (CASA; mean; s.e.m.=81.7±7.7% in Izumo +/− sperm and 77±8.9% in Izumo −/− sperm)). The sterile nature of Izumo −/− sperm was shown in the in vitro fertilization system (Fig. 2a). The impaired fertilization step undoubtedly followed zona penetration because sperm penetrated the zona pellucida and accumulated in the perivitelline space of the eggs (Fig. 2b). Fusion ability in Izumo-deficient sperm Syngamy can be considered to occur to two stages: binding of the sperm plasma membrane to that of the egg, and actual membrane fusion. Izumo −/− sperm were capable of binding to the plasma membranes of eggs whose zona pellucida had been mechanically removed [4] (Fig. 2c). In this system, the Izumo +/− sperm incubated for 2 and 6 h fused to eggs in approximate ratios of 4.5 and 6 sperm per egg, respectively, but no Izumo −/− sperm fused with eggs (Fig. 2c). Sperm can not fuse with eggs unless the former have undergone the acrosome reaction. To verify the acrosomal status of Izumo −/− sperm, we stained the sperm accumulated in perivitelline spaces with the MN9 monoclonal antibody, which immunoreacts only to the equatorial segment of acrosomereacted sperm [5]. The staining indicated that the Izumo −/− sperm had undergone the acrosome reaction (Fig. 2b) but failed to fuse with eggs. Development of eggs after intracytoplasmic sperm injection (ICSI) with Izumo-deficient sperm Because no offspring were fathered by Izumo −/− male mice, it was unclear whether the defect was limited to fusion or extended to later developmental stages. To address this question, we used ICSI to insert Izumo −/− sperm directly into the cytoplasm of wild-type eggs and bypass the fusion step. Eggs injected with Izumo −/− sperm were successfully activated and the fertilized eggs were transplanted into the oviducts of pseudopregnant females. The eggs implanted normally and the resulting embryos developed appropriately to term with rates similar to those of heterozygous mice. Human Izumo is also involved in sperm-egg fusion Sperm–egg fusion is known to be less species-specific than sperm–zona interaction. For example, human sperm can not penetrate the hamster zona pellucida but they can fuse with zona-free hamster eggs, and this system (zona-free hamster-egg sperm penetration test) has been used for the assessment of human sperm fertility. We first examined the contribution of mouse Izumo in a zona-free hamster-egg sperm penetration assay. As indicated in Fig. 3a, the mouse Izumo was essential not only in the homologous fusion system but also for heterologous fusion with hamster eggs. Similarly, when the anti-human Izumo polyclonal antibody was added to the incubation mixture, no fusion was observed, whereas the sperm treated with control IgG fused with eggs at an average of 5.9±0.7 sperm per egg. The total numbers of eggs observed were 23 and 29, respectively (n=3). These results indicated that human Izumo is involved in the fertilization process in human sperm (Fig. 3b). Rescued fertility of Izumo-deficient male by transgene The phenotypes of gene knockout mice are not always related Figure 2 Male infertility caused by Izumo disruption. a, In vitro fertilization of sperm from Izumo +/−and Izumo −/−mice. Unlike Izumo +/−, the eggs inseminated with Izumo −/− sperm had many sperm on their zona pellucida, owing to the failure of sperm–egg fusion that probably leads to the absence of zona-reaction to lessen the sperm-binding ability of the zona pellucida. b,Upper panel, accumulation of many sperm in the perivitelline space of the eggs recovered from the females mated with Izumo −/− males. Lower panel, sperm in perivitelline space labelled with acrosome reacted, spermspecific monoclonal antibody MN9. c, Fused sperm stained by Hoechst 33342 preloaded into the egg. The arrowheads show the fused sperm. to the disrupted genes but are sometimes caused by disruption of a neighbouring gene. To examine whether the phenotype was directly derived from the lack of Izumo on sperm, we performed a rescue experiment by crossing Izumo −/− mice with transgenic mouse lines generated to express Izumo by using the testis-specific calmegin promoter [6]. The sterile phenotype was rescued with the transgenically expressed Izumo on mouse sperm (Fig. 4). Discussion In the search for sperm surface proteins that function in sperm–egg plasma-membrane binding and fusion, various candidates such as DE, CD46, equatorin, Sperad and SAMP32 have been reported. ADAM family proteins are given the most attention for their possession of a putative fusion peptide (ADAM1) and disintegrin domain (ADAM2 and ADAM3). None of the mice possessing disrupted ADAM1a, ADAM2 and ADAM3 show a significant defect in the ability to fuse with eggs [7-9], but do show an impairment of sperm–zona binding ability. Similarly, CD46 disruption does not diminish fusion [3]. In contrast, CD9 on the egg surface is essential for the fusing ability of eggs [1] and some indications for the involvement of the binding of integrins to CD9 are postulated in reference to sperm–egg fusion. However, the disruptions of the most probable candidate integrin α6β1 cause no major influence on the fusing ability of eggs. Thus, for several years, postulated fertilization mechanisms were repeatedly changed as a result of gene disruption experiments. This suggests that the essential nature of the candidate gene must be judged after observing the phenotype of the gene-disrupted mice. In this context, Izumo is the first sperm membrane protein shown to be essential for fusion. It is not yet known whether sperm Izumo interacts with egg CD9, as occurs with placental IgSF protein PSG17; neither do we know why the localization of Izumo after acrosome reaction is not limited to the 41 Osaka University 100 Papers : 10 Selected Papers ANNUAL REPORT OF OSAKA UNIVERSITY—Academic Achievement—2004-2005 Figure 4 Transgene to express mouse Izumo under the control of calmegin promoter. a, The locations of primers A to E were indicated in this figure. b, lane 1; Izumo +/− mouse with intrinsic Izumo, lane 2 and 3; Izumo −/− mouse with transgenically expressed Izumo and Izumo His-tag, respectively. c, Litter size obtained by mating male mice with C57BL/6 wild-type mice. The group numbers are equal to those shown in b. The numbers in parentheses indicate the numbers of matings. References 1. Miyado, K. et al., Requirement of CD9 on the egg plasma membrane for fertilization. Science, 287, 321-4 (2000). 2. Okabe, M. et al., Capacitation-related changes in antigen distribution on mouse sperm heads and its relation to fertilization rate in vitro. J Reprod Immunol, 11, 91-100 (1987). 3. Inoue, N. et al., Disruption of mouse CD46 causes an accelerated spontaneous acrosome reaction in sperm. Mol Cell Biol, 23, 2614-22 (2003). 4. Yamagata, K. et al., Sperm from the calmegin-deficient mouse have normal abilities for binding and fusion to the egg plasma membrane. Dev Biol, 250, 348-57 (2002). 5. Manandhar, G. & Toshimori, K., Exposure of sperm head equatorin after acrosome reaction and its fate after fertilization in mice. Biol Reprod, 65, 1425-36 (2001). 6. Ikawa, M. et al., Calmegin is required for fertilin alpha/beta heterodimerization and sperm fertility. Dev Biol, 240, 254-61 (2001). 7. Cho, C. et al., Fertilization defects in sperm from mice lacking fertilin beta. Science, 281, 1857-9 (1998). 8. Nishimura, H., Cho, C., Branciforte, D. R., Myles, D. G. & Primakoff, P., Analysis of loss of adhesive function in sperm lacking cyritestin or fertilin beta. Dev Biol, 233, 204-13 (2001). 9. Nishimura, H., Kim, E., Nakanishi, T. & Baba, T., Possible Function of the ADAM1a/ADAM2 Fertilin Complex in the Appearance of ADAM3 on the Sperm Surface. J Biol Chem, 279, 34957-62 (2004). equatorial segment where fusion initially takes place. All we can say now is that continued study of this protein’s function will undoubtedly lead to a fuller understanding of the cell–cell fusion process in fertilization and perhaps in other somatic systems such as muscle cells or trophoblasts. The finding not only provides insight into the enigmatic fusion mechanism but also promises benefits in the clinical treatment of infertility and the potential development of new contraceptive strategies

Performance Lawn Equipment (PLE)

PLE, headquartered in St. Louis, Missouri, is a privately-owned designer and producer of traditional lawn mowers used by homeowners. Annual sales are approximately $180 million. Both end users and institutions (organizations) are important customers for PLE. This case is ONLY about organizations (such as retail outlets) that buy from PLE. There are two type of organizations that are PLE customers: (1) dealerships or retail stores that in-turn sell to end-customers, and (2) organizations that buy products to use in their operations (such as golf courses or professional lawn care businesses). A purchasing manager in such organizations makes the decisions about which brand of lawn mowers to buy and how many to buy.

Elizabeth Burke has recently joined the PLE management team to oversee production operations. She has asked you to analyze results of a survey of purchasing managers in PLE’s institutional customers.

The worksheet Purchasing Survey in the Performance Lawn Care database provides data obtained from a survey of purchasing managers of institutional customers. Respondents rated PLE on the following seven attributes:

Delivery speed-the amount of time it takes to deliver the product once an order is confirmed

Price level-the perceived level of price charged by PLE

Price flexibility-the perceived willingness of PLE representatives to negotiate price on all types of purchases

Manufacturing image-the overall image of the manufacturer

Overall service-the overall level of Service necessary for maintaining a satisfactory relationship between PLE and the purchaser

Sales force image—the overall image of the PLE’s Sales force

Product quality-perceived level of quality

Responses to these Seven Variables were obtained using a graphic rating Scale, where a 10-centimeter line was drawn between endpoints labeled "poor and 'excellent." Respondents indicated their perceptions using a mark on the line, which was measured from the left endpoint. The result was a scale from 0 to 10 rounded to One decimal place.

Two measures were obtained that reflected the outcomes of the respondent's purchase relationships with PLE:

Usage level-how much of the firm's total product is purchased from PLE, measured on a 100-point Scale, ranging from 0% to 100%

Satisfaction level-how satisfied the purchaser is with past purchases from PLE, measured on the same graphic rating scale as perceptions 1 through 7

The data also include four characteristics of the responding firms:

Size of firm-size relative to others in this market (O = Small; 1 = large)

Purchasing structure-the purchasing method used in a particular company (1 = centralized procurement, 0 = decentralized procurement)

Industry-the industry classification of the purchaser l = retail (stores that resell to end consumers such as Home Depot), 0 = private (nonresale, Such as a profession lawn care business)

Buying type-a Variable that has three categories (1 = new purchase, 2 = modified rebuy, 3 = Straight rebuy)

Elizabeth Burke would like to understand what she learned from this data.

Cluster Analysis:

Apply cluster analysis to analyze the data to create a segmentation of institutional customers. For example, can PLE segment customers into groups with similar perceptions about the company? Do not use “Usage level” or “Satisfaction level” in making the clusters. Check to see if the clusters differ on usage level and satisfaction or not. Which clusters have high usage and satisfaction and which ones do not? Suggest actions management can take to increase usage and satisfaction for the different clusters.

Regression Analysis:

Can regression models provide insight about the drivers of satisfaction and usage level? What are the most important variables that need to be influenced to increase satisfaction and usage level? Suggest ways management can do so.

Summarize your results in a report to Ms. Burke.