"Mini Case Study - Haley Roberts "

Haley Roberts is quite proud that she has grown her business in website design from a small startup to a mid-sized organization. However, she is now running into some “growing pains.” Now there are sales people and account managers that deal with the clients. Her Controller, Dan, oversees daily operations, human resources, and accounting. One day, Dan comes into Haley’s office to discuss the morning meeting. Sales have almost doubled from the prior year, but collections are down. SOMETHING has to be done! Dan and Haley refer to their notes of the ideas and concerns voiced at the meeting:

• Alex (sales) – “I’m no accountant, I just know sales. I have grown my sales by reaching out to clients who need our help but may not have the best credit. Just by giving them an extra month or so to pay makes a big difference! And who cares, as long as they pay? We still get the money!”
• Jessie (account manager) – “I just want to keep my clients happy. I do that by addressing their concerns, and I can tell you that their biggest concern is usually that they can get similar services cheaper somewhere else. If I start pressuring them to pay sooner, we may lose them!”
• Sam (accounting) – “All I know is that if we are going to get our vendors paid on time, we need to pull in our cash faster! I am tired of putting off payments and then sometimes paying interest or late fees just because I didn’t have enough cash to go around!”
• Dan (Controller) – “Maybe there are ways to get our cash faster without bugging our clients directly. There are companies that will buy our receivables from us, so we would not be dealing with the clients directly regarding collectibles. Of course, that would also cost us…”

Haley feels overwhelmed by all of her options. There is no easy answer. After reviewing the various perspectives above, what should Haley do? What would you do, or what advice would you give to Haley

For each of the Indicators (4.1–4.8) explain how Jenny can ensure she is upholding the practice guidelines. Case study 2 Susannah’s husband Andrew has found out that Joe has been offering lifts to Susannah and the children. He has made a formal complaint to Joe’s supervisor, Betsy. He has threatened to stop his wife and children attending the agency if Joe continues to work with Susannah and has requested a female worker to support his family. Susannah has requested a female support worker, saying she would feel more comfortable and says her husband will allow her to continue attending the agency if she has a female support worker. Jenny is appointed as Susannah’s support worker. Susannah asks for some information about Domestic Family Violence (DFV) services in the local area. She has also asked if she can come to Jenny’s house if she feels unsafe in her own home at any time. Jenny has explained that she cannot offer Susannah accommodation in her house, but she can refer her to a women’s refuge service if Susannah needs this. Jenny feels very strongly about DFV issues and when she was younger she was in a violent relationship herself. 4.1 Comply with legislation and statutory provisions, for example, mandatory reporting, which affect professional practice. 4.2 Alert their employer of relevant legislation not observed by the organisation. 4.3 Deal with service-user information in accordance with the principles and requirements of legislation including that which governs privacy, confidentiality and freedom of information. 4.4 Work within the legal limitations around the right to confidentiality. 4.5 Inform service users about the legal limitations to their right to confidentiality and privacy. 4.6 Ensure information systems relating to service users, resources, programs and projects are in place, and kept in accordance with legislation and organisational policy and procedural requirements. 4.7 Ensure that the fundamental human rights of an individual are not impinged through the misuse of authority granted through law. 4.8 Understand which pieces of legislation govern organisational behaviours, for example, workplace health and safety, and inform the service user group wherever necessary

Case Study Organ Donation Charlie, a young 10 year old boy, was born with a rare liver disease that left him unable to eat or digest food. His rare liver disease also affected his intestines, pancreas and spleen. His condition was considered terminal unless he had a transplant that would cost approximately 1 million dollars. The problem the family encountered was that his insurance (Medicaid) considered this operation to be experimental and therefore not reimbursable. Charlie’s parents summed up the families attitude regarding this by saying “Money is nothing compared to a human life”. The family fought with the government for over 2 years with no success. It wasn’t until the media got involved that the case caught the eye of a young pioneer transplant surgeon, who promised to waive his fee, and agreed to review this case. Upon review, the surgeon felt there was a small window of time for helping Charlie and that it was closing rapidly. The surgeon approached a local hospital and asked them to waive the normal $500,000 down payment for this type of surgery. The hospital declined saying that they could not afford to become a free care center and that this could risk the future of its own transplant program. In a sudden turn of events, Medicaid finally decided to pay for the operation. At first the team could not find a hospital to perform the operation for the limited Medicaid fee but finally found a local teaching hospital that agreed to do it. It took 6 weeks to find a donor. The 16 hour surgery was performed and Charlie received a new liver, small and large intestine, pancreas and spleen. It turned out to be the first five organ transplant performed. Although Charlie faced a number of set backs after the surgery, he returned home to eat solid food for the first time. He turned out to be the first child to survive a multiple organ transplant beyond 6 months.

Questions: 1. What are the ethical issues in this case? 2. Is it right to give five organs to one person when five others could possibly benefit? 3. Is it right for the media to intervene in situations like this? Why or why not? 4. What is your reaction to the statement from the first hospital who did not want to perform the surgery as they did not want to become a free care center and jeopardize their own transplant program?

1. *__true or false____ Sweat glands and hair follicles traverse the dermis and epidermis       acting as potential portals of entry for normal and pathologic micro-organisms.

2. Propionibacterium acnes (normal skin microbiota) resides in sebaceous       glands and produces _________________ which degrades the sebum.

3. Impetigo
   1. involves only the dermis.
   2. can be caused by Staphylococcus aureus and Streptococcus pyogenes.
   3. is not associated with any serious systemic complications.
   4. suggests that significant trauma occurred to the skin before infection began.
   5. is never spread by fomites.

4. Skin infection characterized by purulence is called a __________________.

5. *__true or false____ Both the wood tick and the dog tick act as main vectors of this disease; therefore, the disease is most prevalent in warm months of the year.

6.   ______ In Lyme disease,
   1. 100% of those infected complain of / or notice the rash of erythema migrans.
   2. few of those infected ever progress past the first stage of the illness (despite receiving no antibacterial medication).
   3. passage of the infectious agent requires that the adult tick lay its eggs into the host animal.
   4. the human population is the only reservoir of this infectious agent.
   5. the heart, the nervous system, the skeletal system, and the psychological system can all be affected.

7. ______ Herpes Zoster (choose the incorrect answer)
   1. is considered a reactivation of the chickenpox virus.
   2. usually occurs a few months after the acute case of chickenpox.
   3. starts with pain in the distribution of one sensory nerve..
   4. Increases in incidence as one’s age increases.
   5. , after resolution of the rash, can leave the patient with chronic pain which is termed “post herpetic neuralgia”.

8. Mucous membrane involvement in rubeola produces _____________________________________, erythematous lesions on the buccal mucosa near the molar region. No other disease will present with this finding.

9. ______ Congenital rubella syndrome
   1. is a transient condition that causes no significant sequelae.
   2. can occur even if the mother has no exposure to rubella during pregnancy.
   3. results in surviving infants shedding the virus in throat secretions and urine for many months after birth.
   4. typically does not effect the infant.
   5. is classified as a zoonotic disease.

10. Candida albicans can
    1. cause a blood born condition termed fungemia.
    2. live harmlessly on the skin as normal microbiota.
    3. thrive in moist skin folds.
    4. invade into deep layers of the skin and subcutaneous tissue.
    5. All of the above are correct.

Billingham Packaging is considering expanding its production capacity by purchasing a new​ machine, the​ XC-750. The cost of the​ XC-750 is $ 2.69 million.​ Unfortunately, installing this machine will take several months and will partially disrupt production. The firm has just completed a $50,000 feasibility study to analyze the decision to buy the​ XC-750, resulting in the following​ estimates:

•​Marketing: Once the​ XC-750 is operational next​ year, the extra capacity is expected to generate $ 10.10 million per year in additional​ sales, which will continue for the​ 10-year life of the machine.

•​Operations: The disruption caused by the installation will decrease sales by $5.09 million this year. As with​ Billingham's existing​ products, the cost of goods for the products produced by the​ XC-750 is expected to be 72 % of their sale price. The increased production will also require increased inventory on hand of $1.19 million during the life of the​ project, including year 0.

•Human​ Resources: The expansion will require additional sales and administrative personnel at a cost of $1.91 million per year.

•​Accounting: The​ XC-750 will be depreciated via the​ straight-line method over the​ 10-year life of the machine. The firm expects receivables from the new sales to be 14 % of revenues and payables to be 11 % of the cost of goods sold.​ Billingham's marginal corporate tax rate is 35 %

a. Determine the incremental earnings from the purchase of the​ XC-750.

b. Determine the free cash flow from the purchase of the​ XC-750.

c. If the appropriate cost of capital for the expansion is 10.1 %, compute the NPV of the purchase.

d. While the expected new sales will be $10.10 million per year from the​ expansion, estimates range from $8.05 million to  $12.15 million. What is the NPV in the worst​ case? In the best​ case?

e. What is the​ break-even level of new sales from the​ expansion? What is the breakeven level for the cost of goods​ sold?

f. Billingham could instead purchase the​ XC-900, which offers even greater capacity. The cost of the​ XC-900 is $3.93 million. The extra capacity would not be useful in the first two years of​ operation, but would allow for additional sales in years 3 through 10. What level of additional sales​ (above the $10.10 million expected for the​ XC-750) per year in those years would justify purchasing the larger​ machine?

(5)Which of the following statements is true?

When price rises in a market for pineapples given ceteris paribus, the interaction between the laws of supply and demand will result in a:

(a)A deficit of pineapples

(b)An equilibrium amount of pineapples

(c)A glut of pineapples

(d)A shortage of pineapples

               Table#1-Supply and Demand for CDs

(6)Which of the following price causes a shortage of CDs in the market in Table#1 above?

(a)$6.75

(b)$8.60

(c)$2.45

(d)All of the above

(7)Which of the following is a natural resource in a society?

(a)Computers

(b)I-Phones

(c)Colognes

(d)None of the above

(8)Which of the following statements is true?

The factors that determine the prices breakfast cereals in the City of Baltimore are a concern of:

(a)Both macroeconomists and microeconomists

(b)Neither microeconomists nor macroeconomists

(c)Microeconomists

(d)Macroeconomists

(9)The eternal state of insufficiency of resources to satisfy people’s unlimited wants and needs in a society requires the:

(a)Sub-optimal use of resources

(b)Efficient use of resources

(c)Misuse of resources

(d)Any of the above

(10)Which of the following statements is true?

When constructing a model of a city’s economy, a microeconomist must:

(a)Provide a complete description of the city’s economy

(b)Collect accurate data about the city’s economy

(c)Ignore the realities about the city’s economy

(d)None of the above

(11)Which of the following statements is true?

Assumptions are used by microeconomists to:

(a)Explain all the details of the smaller units in an economy

(b)Simplify an understanding of the smaller units in an economy

(c)Complicate an understanding of a country’s macroeconomy

(d)None of the above

(12)Which of the following statements is true?

Human wants and needs:

(a)Are not fulfilled only in the poorest nations

(b)Can be easily satisfied as technology gets more advanced

(c)Can never be fully satisfied

(d)None of the above

(13)Which of the following statements is false?

The condition of scarcity:

(a)Prevails all societies

(b)Prevails in rich societies

(c)Cannot be eliminated

(d)None of the above

The Air Marshal Co. has recently completed a $10,000,000 two-year marketing study.  Based on the results of this study, Air Marshal has estimated that 800 units of its new security electro-optical human scanning hardware, known as "Marshal Dillon," could be sold annually over the next 12 years, at a price of $110,000 the first year with an estimated 2% annual rise from inflation in years 2-6.  The sales price is expected to drop to $90,000 in year 7 due to increasing competition with 2% annual increase for year 8-12.  Variable costs per unit are $45,000 with an estimated 4% annual rise from inflation in years 2-12 and incremental cash fixed costs total $15 million per year all 12 years.   

Start-up costs include $120 million to build production facilities and an additional $10,000,000 for shipping and installation costs, $25 million for land, and net operating working capital is projected to be 12% of next year sakes. The production facility will be depreciated on a straight-line basis to a value of zero over the twelve-year life of the project.  At the end of the project's life, the facilities (including the land) will be sold for an estimated $25 million.  The value of the land is not expected to change during this time period.

Finally, start up would also entail one-time tax-deductible cash expenses of $5 million at year zero.  Air Marshal is an ongoing, profitable business and pays taxes at a 32% rate.  Air Marshal has a 10% opportunity cost of capital for projects such as this one.  

Be sure to answer to the following questions and express your numbers in millions of dollars where appropriate.   If your annual income should be a loss, assume that tax could be saved from other profitable parts of the company.

1. Please estimate the cash flows for all 12 years and provide a detailed statement of projected cash flows, as was done in the sample quiz solution.
2. Calculate the following for the project:  NPV, IRR, and MIRR.
3. Should Air Marshal proceed with the Marshal Dillon project?
4. Can you please post the excel answers and post the (SHOW FORMULAS) button as well so I can see how you solved the question

QUESTION 8

1. The primary purpose of the “leading” function of management is to ___________?

   		Analyze progress and determine if a course correction is necessary
   		Motivate and encourage employees
   		Set up a structure and job responsibilities
   		Determine a course of action

3 points   

QUESTION 9

1. Which of the following statements about trend analysis charts is TRUE

   		Usually adds to 100%
   		Shows changes over time
   		Show relative value of categories arranged from highest to lowest
   		Valuable for visualizing a vertical analysis

3 points   

QUESTION 10

1. _____ skills refer to a manager's ability to operate in diverse cultural environments.

   		Global management
   		Human relations
   		Professional
   		Diversity

3 points   

QUESTION 11

1. An accounting event must satisfy all of the following criteria EXCEPT

   		It must impact an entity's assets, liabilities and/or owners equity
   		It is must be measurable in monetary terms
   		It must involve an internal and external transaction
   		It must be specific to an entity

3 points   

QUESTION 12

1. When conducting a vertical analysis on a balance sheet and utilizing the common-size percentage formula, the "base amount" used for calculating the liabilities is:

   		Total liabilities and stockholders’ equity
   		Total stockholders’ equity
   		Total liabilities
   		Total Current Liabilities
   		None of the above

3 points   

QUESTION 13

1. A logistics professional setting yearly and monthly goals for their department is engaging in which management function?

   		Planning
   		Organizing
   		Leading
   		Controlling

3 points   

QUESTION 14

1. Which type of planning sets the goals and objectives for the long term, usually more than 1-5 years into the future?

   		Tactical
   		Operational
   		Strategic
   		Contingency

3 points   

QUESTION 15

1. The accounting equation is expressed as ________.

   		Assets + Liabilities = Owner’s Equity
   		Assets – Noncurrent Assets = Liabilities
   		Assets = Liabilities + Investments by Owners
   		Assets = Liabilities + Owner’s Equity

5 points   

QUESTION 16

1. Manila Water, the provider of the water and sewerage services in the capital of the Philippines has purchased the government owned water and sewerage system for the entire country. It promises to make the nation's water and sewerage system run as efficiently and profitably as the one it operates in Manila. Its primary challenge will be the management function of ____ because it needs to convince the 2,000 employees it inherited from the government-owned facility to work more efficiently.

   		organizing
   		controlling
   		leadership
   		planning

Exercise 17.9

The state of Glottamora has $200 million remaining in its budget for the current year. One alternative is to give Glottamorans a one-time tax rebate. Alternatively, two proposals have been made for state expenditures of these funds. The first proposed project is to invest in a new power plant, costing $200 million and having an expected useful life of 20 years. Projected benefits of the new power plant are as follows:

The second alternative is to undertake a job retraining program, also costing $100 million and generating the following benefits:

The state Power Department argues that a 5 percent discount factor should be used in evaluating the projects because that is the government’s borrowing rate. The Human Resources Department suggests using a 12 percent rate because that more nearly equals society’s true opportunity rate. The present value interest factor at the end of years from 0 - 20 for the two discount rates are given in the following table.

Evaluate the projects using both the 5 percent and the 12 percent rates.

If you agree with the Power Department that the government’s borrowing rate is the appropriate discount rate, which project will you choose?

Job retraining program

Power plant