Case Study

As the marketplace for goods and services becomes increasingly global, businesses must understand and embrace diversity in their brands as well as in their work forces. Simply having a diverse employee population is no longer enough, according to Forbes; for a company to succeed in today’s challenging economy, it must not only meet the needs of a multifaceted marketplace, it must respect different cultures, ideas and philosophies.

Innovation

One of the biggest reasons to employ a diverse workforce is the broad base of cultural experience that will drive innovation. Whether an employee is management, mid-level or entry level, when everyone in the work force has a similar background, the creative process that drives innovation and problem solving is similar. A new perspective that does not match this ‘group think’ is more likely to improve the business in a unique way.

Attracting Talent and Customers

Premier industry business talent prefers to work for or with a company that has a diverse work force. Customers also prefer to buy goods and services from diverse companies, too. These are two reasons that Forbes says to be truly successful in the global marketplace, a business must be authentically diverse. That means a company must develop a new model that embraces diversity as a central growth enabler.

From Recruitment to Strategy

Companies that embrace this authentic diversity will find that having only the requisite number of “minorities” in the workplace is not enough. Instead, according to Forbes, companies are developing “chief diversity officer” roles that touch more than just recruitment and human resources. These officers will instead have greater control over areas such as strategy, marketing and sales. Companies that have diversity among the management staff will more easily fulfil the needs of a broad customer base.

Cultural Intelligence

Perhaps the most compelling reason to employ the diverse work force is cultural intelligence. When fellow employees and customers are diverse, the opportunities not just to learn but to appreciate what values other cultures hold sacred are limitless. Adopting these values as part of the business’ core message and product fosters understanding between the cultures. When a business operates with diversity in mind, the opportunity for shared value - both in profit and society is greatly expanded.

Please help by reading and answer the questions below:

QUESTIONS

1. How might the innovation concept apply to diversity management?
2. How might new employees from a different background challenge group think and better contribute to diversity?
3. Why is cultural intelligence likely to increase diversity and does it affect management

Please provide the answer for the question posted above in no less than 1000 words

Thank you for the help

In late 2019, a novel coronavirus was causing infections in China. The virus had close virological characteristics to the coronavirus that caused SARS (SARS-CoV) and was named SARS-CoV-2. Even though the SARS-CoV-2 has been less fatal than SARS-CoV, SARS- CoV-2 has been much more infectious. Shortly after the Chinese outbreak, other countries also began reporting cases. The evolving epidemic was officially declared a pandemic by the World Health Organization (WHO) on 11 March 2020.

In early February 2020, we undertook a study that applied data from historical pandemics, information on the evolving epidemic in China and our experience from modelling SARS and Bird Flu to explore the potential global economic implications of COVID-19 under seven plausible scenarios in a global economic model. “The global macroeconomic impacts of COVID-19: seven scenarios” was released on 2 March 2020. Early results were made available to policymakers in major economies and international institutions. At the time the paper was written, it was still uncertain whether the outbreak would translate into a pandemic. Thus, to estimate what could be the likely costs of a pandemic, three of the seven scenarios explored the economic costs to the world if the outbreak only occurred in China and four of the scenarios explored the global economic costs if a global pandemic occurred but at varying degrees of attack rates and case fatality rates.

The evolution of the pandemic and the economic implications continue to be highly uncertain. However, as new information emerges, notably greater understanding through scientifically based interventions in some countries and outright failure in others, the nature of the uncertainty has changed. Initially, uncertainty was about how close COVID-19 would be to the historical experience of pandemics. After six months, the concern is now about how frequently the pandemic might recur and how high the economic costs of responding or not responding in some countries might be. Policy in many countries initially was designed to contain the virus and to minimise economic disruption, particularly in the labour market. The focus now is how to open economies hit with a massive economic shock and how economies will adapt to the post-COVID-19 world. It is uncertain whether a vaccine will be available in time to prevent more pandemic waves and, if not, what would be the least costly option of managing them. It is an open question of whether lockdowns are the right option for managing recurring waves or if it will be possible for people to adapt to long-term social distancing and improved hygiene practices.

In this paper, we attempt to guide policymakers determine how different responses might change possible economic futures. In addition to our previous experience in modelling pandemics and particularly COVID-19, we capitalise on the novel, yet imperfect, information on cases and responses to the pandemic worldwide.

The paper is structured as follows. The next section places the current study in the context of our previous study and other recent studies conducted by the International Monetary Fund (IMF), the Organization for Economic Cooperation and Development (OECD) and the World Bank on economic repercussions of COVID-19. Section 3 summarises the G-Cubed model used in the study. Section 4 explains in depth how and why different scenarios and shocks were constructed. The results from the simulations are presented in Section 5 before we conclude and present possible policy implications arising from the study in the final section.

Provide a brief summary of the information in the source. Explain how this information is relevant and explain that this information shows that the problem exists, that there’s an effective way to solve the problem, or that information shows ways to overcome inaction.

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The European Commission estimations have recently shown that EU countries would have entered in recession this year with a fall of 2.5 % GDP average rate even if the pandemic crises had not existed. In this paper the author intentions are to analyse the magnitude of the present crisis by emphasizing the main features that are uncommon with other crises.

Nowadays it might be a proper solution to build a defence system around EU if we rely on three types of scenarios: on short term until the passing from the infection peak, on medium term until the economic and social imbalances could be stabilised and on long run with the economic recovering from a minimum point reached to new targets expected to be suitable in the new circumstances. In the country case, it is important to calculate the real economic losses in terms of trade and investments. We see that the economic disparities are stronger now than in the 2008 financial crisis due to the rapid contagion.

The main impediments triggered by the actual pandemic on the economy and the society in Romania and in many European countries are the following:

* The internal economic activity is affected by lockdown circumstances.

* The returning of a massive workers from overseas put pressures on the social protection funds and also on medical care services particularly for Romania;

* The social pressures induced directly by the lockdown in education, culture, sport and entertainment would provoke a harmful effect on general productivity;

* Possible disruption in energy, water and raw materials supply;

* The shortage of internal financial resources caused by huge expenses and no inputs would increase the budgetary disproportions.

* Diminishing of exports absorption capacity of the most affected of SarsCov-2 countries and the need of production adapting to the new demand level.

* The high risk of economic imbalances could outbursts from: rising of unemployed people, primary resources prices evolution (petroleum, gas, agri-food), aggressive acquisitions on Stock Markets;

* Risks on the economic crisis and the overlapping between this and the pre-existing agricultural cycle.

* The harmonising of world economic activities is occurred with different oscillations until the steadiness is reached. This is the reason why the projections of the future oscillatory economic evolution are difficult to be calculated.

* The role of state, and of EU and international institutions is to provide stability.

At the global level, the answer should be in line with the more important task to ensure a rapid and efficient capacity of response for the actual and future challenges.

At the macroeconomic level it is vital lessening the negative effects of Stock Exchange worries, and backing small and medium firms in a sense to stimulate their activity by creating a proper fiscal and financial environment for the new economic reality.

The Romanian economy has been affected by the external trade channel on the basis of the high level of trade integration with the rest of UE states (roughly 70% of Romanian total trade is oriented to EU). The most affected by the actual pandemic are EU countries with highest GDP contributors to the EU budget: Germany, France, Italy and Spain. The lockdown of all these countries during March and April 2020 and the frozen of investment plans have been creating high repercussions on overall exports by channel of contagion spread on different countries Imports would be also affected by the disruptions on the Global Value Chain in the same time. Also, the process of replacing the supply parts is difficult especially for narrow specialisation developed the recent years.

A parallel between the 2008-financial crisis and the present crisis emphasizes only some features. First of all, it must be observed that the 2008-financial crisis provoked a high global threat that has been felt in the last few years after the eruption. It was difficult for developed countries especially for some UE member states (PIIGS countries especially) to solve the fiscal and debt burden. Nowadays, a new type of global threat has arisen 12 years after the 2008 financial crisis. This time, the primary source is a medical one, spreading at a global level. Still in both crisis we observe the rapidly spread worldwide even we talk about a virus or financial contagion.

We observe also that the economic effects are stronger now than in the 2008 financial crisis due to the fast contagion. The 2008-financial crisis had passed on Europe in several months and extended gradually in entire EU from USA. The EU financial system had resisted to solve the crisis and several financial programs for supporting the most affected sectors had been adopted (banking and automotive). Since September 2012 other unconventional measures have been approved by ECB. In addition, the euro zone launched the European Stability Mechanism that replaced the European Stability Fund. State aid was a practical solution at the moment of international financial eruption in EU. The EU state aid for financial sustenance totalled 1.6 trillion Euros during the last quarter of 2010. The great part of financial aid was given in the form of government guarantees for liquidity increasing that amount to 9 per cent of EU GDP. The banking recapitalisation and shares acquisition equalled almost 3 per cent of whole EU GDP, an amount of 300 billion euros respectively.

The EU guideline of adopting measures taken by Euro members states with the general task of banking functioning guarantees by the public funds in the 2008 and 2009 period has consisted of four official communications. The fiscal burden has been proved problematic especially for the business environment for a long period in the absence of financial support. The sustainability of those deficits was critical in some eurozone states, especially those that has been called PIIGS. Financial market players decided to rise the interests on loans to cover souverain debt as a consequence of continuing fiscal burden. The bond yields have been increasing after 2010 for those risky countries.

The eurozone countries signed at 7th of May 2010 an Agreement of Stability, Unity and Integrity for adopting necessary measures for fiscal criteria stipulated in the Stability and Economic Growth. All eurozone countries except Estonia and Luxembourg have agreed to adopt programmes of reduce the fiscal burden under the excessive deficit procedure triggering.

3Measures adopted by EU up to 2020. The Romanian case

The speed of contagion in the actual pandemic crisis on some EU member states has determined the necessity of adopting new state aid regulations for sustaining the most sensitive sectors. The communication on the economic aspects of Coved -19 crisis was published by European Commission on 13 March 2020 revealing the main economic financial support measures that cannot be exclusively covered entirely by the European budget. Taking into consideration the internal legislation of EU countries we notice the state aids have been used for supporting certain sectors. Since the mid of March 2020 substantial financial packages have been adopted by the governments in some states where the pandemic crisis has spread rapidly.

In Romania the main trade partners from EU, namely Germany, Italy, France and Spain have been seriously prejudiced by the pandemic crisis that already have hit the bilateral exports and imports flows. If we add the substantial global value chain disruption and the significant part of China on the intermediary inputs chain for products like microchips, auto parts and chemical products we observe a major drop of global trade in 2020. Romania among other EU member state is not so affected by the reduction of Chinese trade flows, the share of Chinese inputs on total incomes of Romanian firms being of only 2.8% that is much lower in comparison with Hungary (7.5%) and Holland (7%).

A complete landscape of the pandemic crisis impact on world economy is difficult to be assessed because is too early. The projections published by the international institutions have been changing in accordance to the volatile data. A possible economic impact could be advanced concerning the imminent economic recession not only in the euro area but overall, in the world economy. In addition, if we take into consideration the financial markets evolution it depends mostly by the supervisory and regulation

The impact of the actual pandemic crisis on the economy and financial market would be quite high after two months of lockdown for some many of the world economies. This unexpected and unorthodox measures will cause a very deep recession. Some of the international investors and experts project a slowdown similar with those from the Great Depression from the 1929-1933 period. For now, is pretty hard to estimate a valid long and medium period prognosis, having in mind the dynamic change of the real medica facts that affects directly our life. At least on short time we observe programmes of quantitative easing in many countries aiming at increase the liquidity in economies.

Returning to a new normality is a necessary step that requests a dynamic and complex flow of collecting and information processing data from the medical care, in finding a proper vaccine and the evolution of the economic increase and trade. All this change would indicate a new picture of tactical alliances with the aim of regaining the breath after the deep recession. We could estimate better the real situation of downfall only after the official economic data of world exports, imports that reflects the level of offer and demand.

Provide a brief summary of the information in the source. Explain how this information is relevant and explain that this information shows that the problem exists, that there’s an effective way to solve the problem, or that information shows ways to overcome inaction.

Mastery Problem: Corporations: Organization, Stock Transactions, and Dividends

Pranks, Inc.

Pranks, Inc. is a manufacturer of joke and novelty products for perpetrators of practical jokes. The corporation has paid several cash dividends throughout Year 6, the current year. It is also declaring a stock dividend to its stockholders as the calendar year-end approaches. You’ve been brought in as a consultant to assist with this process, and also to help determine whether some missing information can be determined before the distribution of the stock dividend is made. The company has two classes of stock: common stock and cumulative preferred stock.

Number of common shares authorized900,000

Number of common shares issued750,000

Par value of common shares$20

Par value of cumulative preferred shares$30

Paid-in capital in excess of par-common stock$7,000,000

Paid-in capital in excess of par-preferred stock$0

Total retained earnings before the stock dividend is declared$33,500,000

No treasury share have been reissued.

Preferred DividendsCommon Dividends

YearTotal Cash
DividendsTotalPer ShareTotalPer Share

Year 130,000  30,0000.20      00.00      

Year 254,000  54,0000.36      00.00      

Year 396,000  51,0000.34      45,0000.09      

Year 4120,000  45,0000.3      75,0000.15      

Year 5135,000  45,0000.3      90,0000.18      

Year 6195,000  45,0000.3      150,0000.3      

Cash Dividends

The accounting manager for the company prepared the schedule of cash dividends paid from Year 1 to Year 6 on the Pranks, Inc. panel. However, one of the reasons for Pranks, Inc.’s missing information is that the manager is away on vacation and is unreachable by phone, because he is backpacking on a remote island that does not have cell phone reception. Management would like you to determine some information from the data you’ve collected regarding its outstanding stock.

Fill in the following answers.

How many shares of common stock are outstanding?

How many shares of preferred stock are outstanding?

What is the preferred dividend as a percent of par?
%

Additional Questions

1. After completing the Cash Dividends panel, answer the following question.

Does Pranks, Inc. have any treasury stock? How can you tell?

2. In which years has Pranks, Inc. paid cumulative preferred dividends in arrears?

a.Year 1

b.Year 2

c.Year 3

d.Year 4

e.Year 5

f.Year 6

Stock Dividend

The company declared a 2% common stock dividend on December 1, and would like you to compute the following pieces of missing information. The market value of the common shares is $26 on December 1, and is $32 on the actual distribution date of the stock, December 31.

Fill in the missing information in the following table, using the information given and your work on the other panels. All “before” items are before the stock dividend was declared. All “after” items are after the stock dividend was declared and closing entries were recorded at the end of the year.

Total paid-in capital before the stock dividend$

Total retained earnings before the stock dividend

Total stockholders’ equity before the stock dividend$

Total paid-in capital after the stock dividend$

Total retained earnings after the stock dividend

Total stockholders’ equity after the stock dividend$

P11.6 The following data relate to the Plant Assets account of Keller Inc. at December 31, 2019:

Note: In the year an asset is purchased, Keller does not record any depreciation expense on the asset. In the year an asset is retired or traded in, Keller takes a full year's depreciation on the asset.

The following transactions occurred during 2020:

• 1. On May 5, Asset A was sold for $16,500 cash. The company's bookkeeper recorded this retirement as follows:

  Cash		16,500
  Asset A				16,500

• 2. On December 31, it was determined that Asset B had been used 3,200 hours during 2020.
• 3. On December 31, before calculating depreciation expense on Asset C, Keller management decided that Asset C's remaining useful life should be nine years as of year end.
• 4. On December 31, it was discovered that a piece of equipment purchased in 2019 had been expensed completely in that year. The asset cost $31,000, had a useful life of 10 years when it was acquired, and had no residual value. Management has decided to use the double-declining-balance method for this asset, which can be referred to as “Asset E.” Ignore income taxes.

Instructions

a. Prepare any necessary adjusting journal entries required at December 31, 2020, as well as any entries to record depreciation for 2020. Round all amounts to the nearest dollar.

b.  As an owner of Keller Inc., do you have any concerns with respect to the bookkeeper's work?

Conrad Playground Supply underwent a restructuring in 2021. The company conducted a thorough internal audit, during which the following facts were discovered. The audit occurred during 2021 before any adjusting entries or closing entries are prepared.

1. Additional computers were acquired at the beginning of 2019 and added to the company’s office network. The $49,500 cost of the computers was inadvertently recorded as maintenance expense. Computers have five-year useful lives and no material salvage value. This class of equipment is depreciated by the straight-line method.
2. Two weeks prior to the audit, the company paid $21,500 for assembly tools and recorded the expenditure as office supplies. The error was discovered a week later.
3. On December 31, 2020, merchandise inventory was understated by $87,000 due to a mistake in the physical inventory count. The company uses the periodic inventory system.
4. Two years earlier, the company recorded a 4% stock dividend (2,900 common shares, $1 par) as follows:

The shares had a market price at the time of $12 per share.

5. At the end of 2020, the company failed to accrue $122,000 of interest expense that accrued during the last four months of 2020 on bonds payable. The bonds, which were issued at face value, mature in 2025. The following entry was recorded on March 1, 2021, when the semiannual interest was paid, as well as on September 1 of each year:

6. A three-year liability insurance policy was purchased at the beginning of 2020 for $74,700. The full premium was debited to insurance expense at the time.

Required:
For each error, prepare any journal entry necessary to correct the error, as well as any year-end adjusting entry for 2021 related to the situation described. (Ignore income taxes.) (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Do It! Review 14-3 The condensed financial statements of Murawski Company for the years 2019 and 2020 are presented follows. (Amounts in thousands.) MURAWSKI COMPANY Balance Sheets December 31 2020 2019 Current assets Cash and cash equivalents $ 370 $ 368 Accounts receivable (net) 414 468 Inventory 390 480 Prepaid expenses 166 140 Total current assets 1,340 1,456 Investments 14 10 Property, plant, and equipment 350 400 Intangibles and other assets 484 508 Total assets $2,188 $2,374 Current liabilities $ 766 $ 908 Long-term liabilities 350 428 Stockholders’ equity—common 1,072 1,038 Total liabilities and stockholders’ equity $2,188 $2,374 MURAWSKI COMPANY Income Statements For the Years Ended December 31 2020 2019 Sales revenue $3,810 $3,820 Costs and expenses Cost of goods sold 908 942 Selling & administrative expenses 2,300 2,378 Interest expense 21 25 Total costs and expenses 3,229 3,345 Income before income taxes 581 475 Income tax expense 142 81 Net income $ 439 $ 394 Compute the following ratios for 2020 and 2019. (Round current ratio and invertory turnover ratio to 2 decimal places, e.g. 1.62 or 1.62% and all other answers to 1 decimal place, e.g. 1.6 or 1.6%.) (a) Current ratio. (b) Inventory turnover. (Inventory on 12/31/18 was $331.) (c) Profit margin ratio. (d) Return on assets. (Assets on 12/31/18 were $1,912.) (e) Return on common stockholders’ equity. (Stockholders' equity on 12/31/18 was $888.) (f) Debt to assets ratio. (g) Times interest earned.

Conrad Playground Supply underwent a restructuring in 2021. The company conducted a thorough internal audit, during which the following facts were discovered. The audit occurred during 2021 before any adjusting entries or closing entries are prepared.

1. Additional computers were acquired at the beginning of 2019 and added to the company’s office network. The $46,000 cost of the computers was inadvertently recorded as maintenance expense. Computers have five-year useful lives and no material salvage value. This class of equipment is depreciated by the straight-line method.
2. Two weeks prior to the audit, the company paid $18,000 for assembly tools and recorded the expenditure as office supplies. The error was discovered a week later.
3. On December 31, 2020, merchandise inventory was understated by $80,000 due to a mistake in the physical inventory count. The company uses the periodic inventory system.
4. Two years earlier, the company recorded a 5% stock dividend (2,200 common shares, $1 par) as follows:

The shares had a market price at the time of $11 per share.

5. At the end of 2020, the company failed to accrue $108,000 of interest expense that accrued during the last four months of 2020 on bonds payable. The bonds, which were issued at face value, mature in 2025. The following entry was recorded on March 1, 2021, when the semiannual interest was paid, as well as on September 1 of each year:

6. A three-year liability insurance policy was purchased at the beginning of 2020 for $72,600. The full premium was debited to insurance expense at the time.

Required:
For each error, prepare any journal entry necessary to correct the error, as well as any year-end adjusting entry for 2021 related to the situation described. (Ignore income taxes.) (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Pasti Berhad values advertise and sell residential property on behalf of its customers. The company has been in business for only a short time and is preparing a cash budget for the first four months of the year 2020. The expected sales of residential properties are as follows.

The average price of each property is RM180,000 and Pasti Berhad charges a fee of 3% of the value of each property sold. Pasti Berhad receives 1% in the month of sale and the remaining 2% in the month after sale. The company has ten employees who are paid monthly. The average salary per employee is RM36,000 per year. If more than 20 properties are sold each month, each employee will be paid in that month a bonus of RM1,500 for each additional property sold.

Variable expenses are incurred at the rate of 50% of the value of each property sold and these expenses are paid in the month of sale. Fixed overheads of RM44,300 per month are paid in the month in which they arise. Pasti Berhad pays interest every three months on a loan of RM200,000 at a rate of 6% per year. The last interest payment in each year is paid in December.

Outstanding tax liability of RM95,800 is due to be paid in April. In the same month, Pasti Berhad intends to dispose of surplus vehicles, with a net book value of RM15,000, for RM20,000. The cash balance at the start of January 2020 is expected to be a deficit of RM40,000.

Required:
a) Prepare a monthly cash budget for the period from January to April. Your budget must clearly indicate each item of income and expenditure, and the opening and closing monthly cash balances.
b) Discuss the factors to be considered by Pasti Berhad in planning ways to invest any cash surplus forecast by its cash budgets.
c) Discuss the TWO (2) advantages and TWO (2) disadvantages to Pasti Berhad of using overdraft finance to fund any cash shortages forecast by its cash budgets.

Ivanhoe Industries manufactures sump-pumps. Its most popular product is called the Super Soaker, which has a retail price of $1,280 and costs $540 to manufacture. It sells the Super Soaker on a standalone basis directly to businesses. Ivanhoe also provides installation services for these commercial customers, who want an emergency pumping capability (with regular and back-up generator power) at their businesses. Ivanhoe also distributes the Super Soaker through a consignment agreement with Menards. Income data for the first quarter of 2020 from operations other than the Super Soaker are as follows.

Ivanhoe has the following information related to two Super Soaker revenue arrangements during the first quarter of 2020.