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The financial statements for Limited Brands, Inc. follow (fiscal years ending January):

Please refer to Limited Brands, Inc.’s financial statements above. Prepare common-size financial statements for Limited Brands, Inc. for 2006–2007.

Treibacher, an Austrian vendor of hard-metal powders, agreed to two contracts with the defendant TDY to sell specified quantities of tantalum carbide (TaC), a hard-metal powder, to TDY Industries, Inc., for delivery to consignment. TDY planned to use the TaC in manufacturing tungsten-graded carbide powders at its plant in Gurney, Alabama. After it had received some of the amount of TaC specified in the November 2000 contract, TDY refused to take delivery of the balance of the TaC specified in both contracts and, in a letter to Treibacher dated August 23, 2001, denied that it had a binding obligation to take delivery of or pay for any TaC that it did not want to use. Unbeknownst to Treibacher, TDY had purchased the TaC it needed from another vendor at lower prices than those specified in its contracts with Treibacher. Treibacher eventually sold the quantities of TaC that TDY had refused to take delivery of, but at lower prices than those specified in its contracts with TDY. Treibacher then filed suit against TDY, seeking to recover the balance of the amount Treibacher would have received if TDY had paid for all of the TaC specified in the November and December 2000 contracts. What is the appropriate remedy here for Treibacher if TDY is in breach? Does this case fall under the CISG or the UCC? Is there any significance to applying the CISG rather than the UCC? [Treibacher Industrie, A.G., Plaintiff-Appellee, v. Allegheny Technologies, Inc., a Pennsylvania Corporation et al., Defendants, TDY Industries, Inc., Defendant-Appellant, 464 F.3d 1235 (11th Cir. 2006); 2006 U.S. App. LEXIS 23252; 19 Fla. L. Weekly Fed. C 1046 (2006).]

Curly Hair is a Brazilian start-up that offers a wide portfolio of hair products (shampoo, conditioner, foam, serum…) specifically designed to take care of curly hair.

Curly Hair manufactures its products in three different plants and sells them in five markets around the country. The plants have a certain manufacturing capacity. In the tables below, you can find the demand for each market, the capacity of each plant, and the distances (in miles) between plants and markets.

The operations manager of the company proposes to redesign the transportation network and start using some distribution centers (DCs) as an intermediary step between plants and final markets. There are four DCs that could be used. These DCs have a certain capacity and they cannot be used as warehouses (they do not keep stock), products must just flow through them.

In the tables below you will find the maximum capacity of each DCs, the distances between plants and DCs, and the distances between DC and markets.

The inbound transportation cost (from plants to DCs) is 2.61 Brazilian reals per liter per mile, and the outbound transportation cost (from DCs to markets) is 3.02 Brazilian reals per liter per mile. There is also a fixed cost of 5,000 Brazilian reals for each DC that the company decides to use.

Design a distribution network that can use these DCs. What is the optimal cost (transportation + fixed cost) under this new situation?

A.) The amount of time customers spend waiting in line at a bank is normally distributed, with a mean of 3.5 minutes and a standard deviation of 0.75 minute. Find the probability that the time a customer spends waiting is as follows. (Round your answers to three decimal places.)

less than 4 minutes

less than 2 minutes

B.) The breaking point of a particular type of rope is normally distributed, with a mean of 310 pounds and a standard deviation of 24 pounds. What is the probability that a piece of this rope chosen at random will have the following breaking points? (Round your answers to three decimal places.)

less than 280 pounds

between 300 and 330 pounds

C.) The weights of all the boxes of corn flakes filled by a machine are normally distributed, with a mean weight of 13.5 ounces and a standard deviation of 0.4 ounce. What percent of the boxes will have the following weights? (Round your answers to one decimal place.)

weigh less than 13 ounces

weigh between 12.5 ounces and 14.5 ounces

D.) A manufacturer of light bulbs finds that one light bulb model has a mean life span of 1020 hr with a standard deviation of 81 hr. What percent of these light bulbs will last as follows? (Round your answers to one decimal place.)

at least 980 hr

between 800 and 880 hr

E.) Find the z-score, to the nearest hundredth, that satisfies the given condition.

0.348 square unit of the standard normal distribution is to the right of z.

F.) Find the z-score, to the nearest hundredth, that satisfies the given condition.

0.251 square unit of the standard normal distribution is to the left of z.

G.) Find the area, to the nearest thousandth, of the indicated region of the standard normal distribution.

The region where z < −0.88

H.) Find the area, to the nearest thousandth, of the standard normal distribution between the given z-scores.

z = 1.12 and z = 1.9

Dixie Showtime Movie Theaters, Inc., owns and operates a chain of cinemas in several markets in the southern U.S. The owners would like to estimate weekly gross revenue as a function of advertising expenditures. Data for a sample of eight markets for a recent week follow.

In 1993, Windsor Company completed the construction of a building at a cost of $2,160,000 and first occupied it in January 1994. It was estimated that the building will have a useful life of 40 years and a salvage value of $65,600 at the end of that time. Early in 2004, an addition to the building was constructed at a cost of $540,000. At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $21,600. In 2022, it is determined that the probable life of the building and addition will extend to the end of 2053, or 20 years beyond the original estimate.

Background

Pure Sport plc was formed following the merger of Pure Limited and Sport Limited in 2016. It

is a listed company which designs, manufactures, markets and distributes footwear, sportswear

and leisurewear products in Asia, Europe and North America. Pure Sport plc employs

approximately 1,000 people at its three sites in the United Kingdom and Ireland, and supplies

products to over six million customers in 20 countries.

Pure Sport plc holds inventory of about 100,000 different components and product elements for

use in the manufacture of its products.

Organisational Structure and Market / Competitor Information

Pure Sport plc is organised into three divisions based upon its lines of business: Footwear

Division (FWD); Sportswear Division (SWD); and Leisurewear Division (LWD).

1. FWD’s primary products are sports shoes aimed at customers aged 12-30 years that are

fashion and exercise conscious at the same time. The average product price is in the lower

quartile when compared against competitors, with 90% of sales in this area coming from

the Asian market.

2. SWD focuses on high net income customers aged 25-45 years who value status and

emerging materials, design and technology on their high-performance product. The

average product price is the upper quartile when compared against direct competitors and

75% of sales for these products come from North America.

3. LWD’s products are aimed at customers aged 8-30 years who like to wear the latest trends

and styles and have great control and choice over their look. The average product price is

in the lower quartile when compared against direct competitors. Sales for these products

are divided 40% Asia / 37% North America / 23% Europe.

The company sells products direct to consumers by mail order, through retailers and aggregated

wholesalers; it also creates ‘white label products’ and sells clothing components and blueprints

to other manufacturers.

The present structure was established by Pure Limited in 1998 and continued after the merger

with Sport Limited. While the directors of Pure Sport plc consider continuity to be a very

important value, many of Pure Sport plc’s competitors have undertaken structural re

organisations in recent years. In 2016, Pure Sport plc commissioned a review of its

organisational structure from an independent consultancy firm. The consultants suggested

alternative structures which they believed Pure Sport plc could employ to its advantage.

However, Pure Sport plc’s directors believed that continuity was more important and no change

to the organisational structure occurred.

Pure Sport plc owns three freehold properties which it uses as administrative offices for each

of its three divisions. Each property had an expected useful life of 50 years on its date of original

acquisition (which was prior to the merger of Pure Limited and Sport Limited in 2016), and the

directors believe that this assumption will still be appropriate at 31 December 2019. It is

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company policy to depreciate the properties on a straight-line basis over their estimated useful

economic life.

FWD property SWD property LWD property

Date of acquisition 1 January 2010 1 January 2010 1 January 2010

Original cost £10,000,000 £10,000,000 £10,000,000

Net book value at 31 December 2019 £8,000,000 £8,000,000 £8,000,000

Market value at 31 December 2019 £6,000,000 £14,000,000 £10,000,000

In the financial statements for the year ended 31 December 2019, the directors of Pure Sport

plc are proposing to show the SWD and LWD properties at market value and the FWD property

at its depreciated historic cost. The directors believe the fall in the market value of the FWD

property is temporary and its value will rise in the next one to two years.

Product and Service Delivery

Consumers, retailers and wholesalers are increasingly seeking to collaborate with the designers

of Pure Sport plc’s products and the associated manufacturing and assembly processes. Pure

Sport plc’s directors view this as a growth area.

The directors of Pure Sport plc recognise that the company needs to develop web-based services

and tools which can be accessed by these partners. The traditional method of listing the

company’s range of products, designs and components in a catalogue is becoming less effective,

costly and cumbersome because customers are increasingly seeking specially designed custom

made products as the industry becomes more sophisticated.

In October 2019, the directors of Pure Sport plc advised the company’s solicitors to commence

legal action against one of its main suppliers claiming damages of £1,000,000 in respect of

losses sustained as a result of the supply of faulty raw material. According to legal advice, Pure

Sport plc has a very good chance of winning its case; although, it is unlikely to be settled before

the 2019 financial statements are finalised.

Financial Objectives

Pure Sport plc’s directors have generally taken a cautious approach to providing strategic

direction for the company. Most directors consider that this has been appropriate because Pure

Limited was unprofitable for the three years preceding the merger and needed to be turned

around. Also, most directors believe a cautious approach has been justified given the

constrained economic circumstances which have affected Pure Sport plc’s markets since 2016.

While shareholders have been disappointed with Pure Sport plc’s performance over the last

three years, they have remained loyal and supported the company’s directors in their attempts

to move the company into profit. The institutional shareholders however are now looking for

increased growth and profitability combined with a strategic vision for the future.

Financial Information

Pure Sport plc’s prepares its financial statements to 31 December each year and its historical

financial records over the last three years indicate:6

2018 2017 2016

£ million £ million £ million

Revenue 620 433 360

Operating profit 39 20 13

Profit for the year 21 9 5

Earnings per share 11.7 pence 5 pence 2.8 pence

Dividend per share 5.8 pence 0 0

Performance Review

Pure Sport plc’s three divisions have been profitable throughout the last three years. The

revenue and operating profit of the three divisions of Pure Sport plc for 2018 were as follows:

FWD Division SWD Division LWD Division Total

£ million £ million £ million £ million

Revenue 212 284 124 620

Operating profit 20 6 13 39

Capital Budgeting

Pure Sport plc has an internal audit department. The Chief Internal Auditor, who leads this

department, reports directly to the Pure Sport plc’s Finance Director.

Investigation by the Internal Audit department has revealed that managers with responsibility

for capital expenditure have often paid little attention to expenditure authorisation levels

approved by the company’s directors. They have justified overspending on the grounds that the

original budgets were inadequate and in order not to jeopardise the capital projects, the

overspends were necessary. It is perceived by the designers and most staff members that the

need to allow a great deal of customisation on products leads to difficultly in predicting costs

being incurred.

Strategic Planning

Pure Sport plc applies a traditional rational model in carrying out its strategic planning process.

This encompasses an annual exercise to review the previous plan, creation of a revenue and

capital budget for the next five years and instruction to managers within Pure Sport plc to

maintain their expenditure within the budget limits approved by the company’s directors.

The directors of Pure Sport plc stated in the company’s 2018 annual report, published in March

2019, that the overall strategic aim of the company is to:

‘Achieve growth and increase shareholder returns by continuing to design produce and

distribute high quality clothing and footwear products and components and develop

our international presence through expansion into new overseas markets.’

Requirment:

(a) evaluates the financial performance of Total Sport plc over the three-year period 2017 to
2019;
(b) considers how the directors of Total Sport plc can accelerate the growth of the company
and increase its profitability.

Suppose a monopolist facing a downward sloping inverse demand curve p(q) sets prices and quantity (p ∗ , q∗ ). Show that the area between the demand curve and the marginal revenue curve equals the consumer surplus.