Five forces for Zappos Essay Example

Five forces for Zappos Paper The menace of new entrants into the on-line shoe/apparel market is comparatively little due to the fact that Zappos is such an established trade name and has specialized their concern theoretical account. It would be far excessively expensive for a new company to copy the features of Zappos including their following twenty-four hours bringing and big operating expense. The fact that Zappos was losing money ab initio illustrates this trouble. Another issue that would make a high barrier to entry is Zappos committedness to the consumer through nightlong transportation. Zappos stated that the nightlong transportation caused them to go forth their warehouses open for the full twenty-four hours. Any other company would be at a competitory disadvantage if they didn’t fit this concern pattern. In all the manner Zappos does concern creates excessively high a barrier to entry for menaces of new entry to be high ; for that ground we would rate it 2 OF 5. _Substitutes_ We would rate replacements at 3 OF 5. being that the menace is slightly mean. With the singularity of Zappos. non many shops can fit such a shopping experience service as Zappos. The ground we ranked the menace of replacements at 3 of 5 is because there are Brick and Mortar Stores that may be used as replacements of Zappos. These forte shops are non up to Zappos criterions. but at the same clip their specialisation with certain merchandises make them a menace to Zappos. The whole person-to-person contact can hold a large advantage in footings of client service. Zappos replies by extraordinary client service. which truly makes the mean consumer feel as if they are particular and are in contact with a existent individual. We will write a custom essay sample on Five forces for Zappos specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Five forces for Zappos specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Five forces for Zappos specifically for you FOR ONLY $16.38 $13.9/page Hire Writer _Rivalry_ The competition with existing houses for Zappos is just. we gave it a evaluation of 3. 5 OF 5. A chief rival for on-line retail is Amazon ; nevertheless Amazon late bought out Zappos. Since their largest rival is now a sister company. the chief competition Zappos faces are extremely specialised online retail merchants – such as Karmaloop and EastBay. These rivals pose a menace to some of Zappos’ subdivisions such as athletic places. featuring goods. accoutrements. and dress. Both of these sites offer free transportation every bit good. so that takes off one of Zappos’ chief competitory advantages. Zappos still has the premier client service. Currently their biggest challenger is eBay. eBay offers everything that Zappos does. and sometimes at a lower monetary value. However since eBay is an auction site. it can non vouch a set monetary value or free transportation like Zappos can. Customer service is where Zappos sets itself apart from its competition. offering a 365 twenty-four hours return policy and 24/7 call centre hours based in the US. _Suppliers_ We rated the bargaining power of providers at a 5 OF 5 because Zappos has a batch of purchase. A ground behind this is Zappos couldn’t map efficaciously without a co-op provider since they are a distribution company. If the provider decided that they wanted more money per cargo so Zappos most likely comply. Taking the resources to happen new supplies can be really dearly-won. Besides. they may non be able to happen a provider that can offer them the same assortment of trade names and manners that the current provider does. Another manner the provider has dickering power is that there are other companies like Amazon or Overstock. com that they could take to make concern with if Zappos isn’t fulfilling their demands. The provider is perchance the most important nexus in the value concatenation for Zappos and for this ground they have a batch of dickering power with Zappos. _Customers_ There are two aspects we can look at the dickering power of clients. ( 1 ) Zappos is client service based and the clients know that. If the clients lose their power. Zappos may lose clients. ( 2 ) Customer’s do non hold many direct replacements. Places are a necessity and here are few options like Zappos for purchasing places online. In kernel they lose a spot of their power by this fact. Opportunities are if the client does non wish brick and howitzer shops ( physical shopping ) they will still necessitate to buy from Zappos but it opens up spread so of which a new entrant may seek to take advantage. Keeping both those facets in head. the dickering power of clients can be considered intermediate ; therefore a evaluation of 3 OF 5. Decision Zappos has created a really structural attractive company. There is a batch of room for growing with the recent purchase by Amazon. ZAPPOS FIVE FORCES AND SWOT ANALYSIS’ First fix a Five Force Analysis of how Zappos operates utilizing Michael Porter’s model. Supply a short. direct and to the point analysis of each of the five forces every bit good as a Decision about the overall structural attraction of the industry in which your company operates. Confirm your analysis with DATA. Second. show an overall SWOT analysis of Zappos. discourse the deductions of the analysis for future strategic options the company might turn to. You may utilize a narrative manner or diagram for each of the industry forces and your SWOT analysis. In all instances you must Supply A SCALE of how you rate each force in footings of its consequence on the industry’s fight now and in the hereafter. e. g. High/Medium/Low and Increasing/Decreasing/ Staying the Same. The aim of this instance is for you to understand how the picks a company makes about its resources and capablenesss will impact its strategic viability.

Thomas Saverys Steam Engine

Thomas Saverys Steam Engine Thomas Savery was born to a well-known family in Shilston, England sometime around 1650. He was well educated and exhibited a great fondness for mechanics, mathematics, experimentation and invention. Saverys Early Inventions   One of Saverys earliest inventions was a clock, which remains in his family to this day and is considered an ingenious piece of mechanism. He went on to  invent and patented arrangement of paddle  wheels driven by capstans to propel vessels in calm weather. He pitched the idea to the British Admiralty and the Wavy Board but met with no success. The principal objector was the surveyor of the Navy who dismissed Savery with the remark, And have interloping people, that have no concern with us, pretend to contrive or invent things for us? Savery was not deterred he fitted his apparatus to a small vessel and exhibited its operation on the Thames, although the invention was never introduced by the Navy. The First Steam Engine Savery invented the steam engine sometime after the debut of his paddle  wheels, an idea first conceived by  Edward Somerset, Marquis of Worcester, as well as a few other earlier inventors. It’s been rumored that Savery read Somerset’s book first describing the invention and subsequently attempted to destroy all evidence of it in anticipation of his own invention. He allegedly bought up all copies he could find and burned them.   Although the story isn’t particularly credible, a comparison of the drawings of the two engines Saverys and Somersets shows a striking resemblance. If nothing else, Savery should be given credit for the successful introduction of this semi-omnipotent and water-commanding engine. He patented the design of his first engine on July 2, 1698. A working model was submitted to the Royal Society of London. The Road to the Patent Savery faced constant and embarrassing expense in the construction of his first steam engine. He had to keep the British mines and particularly the deep pits of Cornwall free from water. He finally completed the project and conducted some successful experiments with it, exhibiting a model of his fire engine before King William III and his court at Hampton Court in 1698. Savery then obtained his patent without delay. The title of the patent reads: A grant to Thomas Savery of the sole exercise of a new invention by him invented, for raising of water, and occasioning motion to all sorts of mill works, by the important force of fire, which will be of great use for draining mines, serving towns with water, and for the working of all sorts of mills, when they have not the benefit of water nor constant winds; to hold for 14 years; with usual clauses. Introducing His Invention to the World Savery next went about letting the world know about his invention. He began a systematic and successful advertising campaign, missing no opportunity to make his plans not merely known but well understood. He obtained permission to appear with his model fire engine and to explain its operation at a meeting of the Royal Society.  The minutes of that meeting read: Mr. Savery entertained the Society with showing his engine to raise water by the force of fire. He was thanked for showing the experiment, which succeeded according to expectation, and was approved of.   Hoping to introduce his fire engine to the  mining districts of Cornwall as a pumping engine,  Savery wrote a prospectus for general circulation, The Miners Friend; or, A Description of an Engine to Raise Water by Fire.†Ã‚   Implementation of the Steam Engine Saverys prospectus was printed in London in 1702.  He proceeded to distribute it among the proprietors and managers of mines, who were finding at that time that the flow of water at certain depths was so great as to prevent operation. In many cases, the cost of drainage left no satisfactory margin of profit. Unfortunately, although Saverys fire engine began to be used for supplying water to towns, large estates, country houses and other private establishments, it did not come into general use among the mines. The  risk for explosion of the boilers or receivers was too great.   There were other difficulties in the application of the Savery engine to many kinds of work, but this was the most serious. In fact, explosions did occur with fatal results. When used in mines, the engines were necessarily placed within 30 feet or less of the lowest level and could potentially become submerged if the water should rise above that level. In many cases this would result in the loss of the engine. The mine would remain drowned unless another engine should be procured to pump it out. The consumption of fuel with these engines was very great as well. The steam could not be generated economically because the boilers used were simple forms and presented too little heating surface to secure a complete transfer of heat from the gases of combustion to the water within the boiler. This waste in the generation of steam was followed by still more serious waste in its application. Without expansion to the expulsion of water from a metallic receiver, the cold and wet sides absorbed heat with the greatest avidity. The great mass of the liquid was not heated by the steam and was expelled at the temperature at which it was raised from below. Improvements to the Steam Engine Savery later began work with Thomas Newcomen on an atmospheric steam engine.  Newcomen was an English blacksmith who invented this improvement over Slaverys previous design. The Newcomen steam engine used the force of atmospheric pressure. His engine pumped steam into a cylinder. The steam was then condensed by cold water, which created a vacuum on the inside of the cylinder. The resulting atmospheric pressure operated a piston, creating downward strokes. Unlike the engine Thomas Savery had patented in 1698, the intensity of pressure in Newcomen’s engine was not limited by the pressure of the steam. Together with John Calley, Newcomen built his first engine in 1712 atop a water-filled mineshaft and used it to pump water out of the mine. The Newcomen engine was the predecessor to the Watt engine and it was one of the most interesting pieces of technology developed during the 1700s. James Watt was an inventor and mechanical engineer born in Greenock, Scotland, renowned for his improvements of the steam engine. While working for the University of Glasgow in 1765, Watt was assigned the task of repairing a Newcomen engine, which was considered  inefficient but still the best steam engine of its time. He began to work on several improvements to Newcomens design. Most notable was his 1769 patent for a separate condenser connected to a cylinder by a valve. Unlike Newcomens engine, Watts design had a condenser that could be kept cool while the cylinder was hot. Watts engine soon became the dominant design for all modern steam engines and helped bring about the Industrial Revolution. A unit of power called the watt was named after him.

Delivering Benefits Essay Example | Topics and Well Written Essays - 500 words

Delivering Benefits - Essay Example Having multiple health-care plans is important for FedEx in slowing down increases in the cost of benefits in the following ways: Firstly, having the wellness center within the facilities where FedEx employees are trained and advised will enable the company reduce health-insurance costs significantly because the programs help in instilling greater health awareness among its employees. Secondly, we are told the FedEx have a disease management preprogram that provide health care advice to employee suffering from diseases such as arthritis, asthma, and diabetes. This program certainly enables employees understand their health condition and how to manage the diseases thereby reducing unnecessary expenses that would have otherwise been spent on health care service. Thirdly, the nurses’ telephone hotline available for employees who want to seek health care advice on minor illnesses is also important as far as reducing the cost of benefits is concerned. This is because the hotlines enables employees to get quick heath care services from professionally trained nurses thereby reducing the expenses that would be spent if the services were not provided in time (Robert and Jackson 24). This, in turn, reduces the health care cost of benefits to FedEx. Disease management might help a lot with health benefit cost in a number of ways. Firstly, the objective of the program is to minimize the effects of diseases such as arthritis, asthma, and diabetes through screening and preventive care. This is because these diseases are deadly and are likely to burden an organization financially if an employee is left to seek treatment services from the hospital. As such, having the disease management programs within the company will help employees with such illnesses better manage and treat the diseases in time. This reduces the costs that would have otherwise been spent if a patient were left to seek medication from hospitals (Robert and Jackson 26). Training programs such as

Costco Essay Example | Topics and Well Written Essays - 500 words

Costco - Essay Example As for pricing, the major strategy of Costco is that their prices should be for sure lower than those of the competitors. The company sells its products at prices 15-20% lower than other retailers or department stores. The philosophy of the organization is that while other companies are trying to sell at higher prices, Costco should be always finding ways to sell even cheaper. The business believes the major advantage of this strategy is that, first of all, in such a way they offer value. Secondly, this allows to make sure there will be no competitors in their niche – the company makes its prices so low that nobody else can enter their market. Thirdly, the goal of low prices is not only to sell today, but to be building a brand and a system that will be in the market for years. So, though shareholders’ income might not be as high as that of the rivals, Costco is aiming at long-term income instead of short-term financial success. The major distribution channels of the company are its warehouses, to which people come and choose products to buy. Another source of sales is their web-site, which allows to buy items that might not be available at the warehouse. Another advantage of the web-site is speeding up the sales process. For example, a customer may upload photos into the online photo center and pick the pictures at the local warehouse in about an hour. Selling at warehouses allows to company to save on fancy retail stores, salespeople, space rent fees and other attributes of traditional distribution. In addition, the warehouses’ working hours are shorter that those of other retailers, thus allowing Costco to save on labor. However, thought the company seems to be pretty successful, it is exposed to certain risks related to both the country’s economy and the company’s operations mode and strategy. According to Costco, among the greatest risks of the company is strong competition – Costco competes with a great number of retailers, department

Acme Fireworks Prospectus Essay Example for Free

Acme Fireworks Prospectus Essay Acme Fireworks is a fireworks retailer that sells fireworks, puts on ground display fireworks, and large aerial displays fireworks. Acme Fireworks has been a sole proprietorship since it began two years ago. At this time the owner is receiving inquiries as to Acme Fireworks ability to create fireworks displays on a regular basis. CITATION Rog12 \l 1033 (Rogers, 2012). In anticipation of increased business, the owner of Acme Fireworks is in need of some information. This prospectus is going to inform the owner as to: Whether or not the business will be governed by common law or the Uniform Commercial Code. Analyze whether or not the owner has any actual contracts. Explain the potential personal liability to Acme Fireworks is someone is injured by a stray firework. Discuss different employment types while discussing the advantages and disadvantages of each type as it applies to Acme Fireworks. And finally, give suggestions as to why Acme Fireworks should no longer be a sole proprietorship. When it comes to contracts, it is important to understand that there are two different bodies of law that come into play, the Uniform Commercial Code (UCC) and the common law of contracts. The difference between the UCC and the common law contract can make a huge difference in the outcome of a contract dispute. This could be the difference between being able to collect punitive damages, discharge or modify a contract, be able to sue under breach of contract, and whether or not there truly a legally recognizable contract after all CITATION Gun12 \l 1033 (Denton, 2012). It is important to understand the type of contract governed by each body of law. The UCC applies to the sale of goods and securities, and common law of contracts applies to contracts for services, real estate, insurance, intangible assets, and employment CITATION Gun12 \l 1033 (Denton, 2012). If the contract should happen to be for both  the sale of goods and for securities, the dominant element would be in control of the contract CITATION Gun12 \l 1033 (Denton, 2012). Should Acme Fireworks have contracts with the inquiring businesses, these contracts would be governed under UCC rule. The contracts would be for both goods and services with goods being the dominant factor of the contracts. There would be more fireworks than there would be personnel. Hence, this would be the reasoning for a UCC contract. In order for the owner to have valid contracts with inquiring businesses there are five elements that must be present in order for the contracts to be valid. First there must be an offer. An offer is an invitation for another to enter into a contract CITATION Rog 12 \l 1033 (Rogers, 2012).Then there is the need for acceptance. Acceptance is the acquiescence to enter into a contract CITATION Rog12 \l 1033 (Rogers, 2012). Then there is consideration. Consideration is anything of legal value that is asked for and received as the price for entering into a contract CITATION Rog12 \l 1033 (Rogers, 2012). Now there is legality. Legality is the extent to which the contract is legal and not against public policy CITATION Rog12 \l 1033 (Rogers, 2012). Finally, there is capacity. Capacity is the mental competency to enter into a contract CITATION Rog12 \l 1033 (Rogers, 2012). Considering Acme Firework’s new â€Å"contracts†; Was there an offer? No, there was not an offer. The businesses were making inquiries, asking questions trying to find out what Acme Fireworks could handle. Was the acceptance? No, there was no acceptance. There were no contracts offered, therefore nothing to accept. Was there consideration? No, there was no consideration. Pricing of the firework displays was talked about, but that w as just information given to answer question f the inquiry. Is there legality? Yes, when the contracts are made they will be legal as they will not be against public policy. Is there capacity? Yes, there is capacity. It is safe to assume that the owner of Acme Fireworks and the owners of the other businesses are of sound mind and body therefore able to enter into legally binding contracts. So, did the owner have enforceable contracts? No, he did not. While there was legality and capacity; there was no offer, acceptance, or consideration present. Fireworks displays are beautiful and exciting, but they are also very dangerous. The operator of a fireworks display has a duty to fireworks are done in a safe way that does not injure spectators CITATION All13 \l 1033  (Business, 2013). To successfully sue a promoter of a firework display, it must be shown that the promoter failed to keep spectators at a reasonable safe distance CITATION All13 \l 1033 (Business, 2013). In order to sue the operator of a firework display it must be shown that the spectator was injured by the discharge of a fireworks or firework that did not explode properly CITATION All13 \l 1033 (Business, 2013). Should an injury occur negligence by the operator is presumed, as the operator is in sole control of firing the fireworks. Essentially, Acme Fireworks is going to want any such liabilities to be the responsibility of the company and not result in personal liability. Being a sole proprietorship Acme Fireworks will be liable for all debts and claims against the business. A lawsuit of this type could be financially devastating. However, should Acme Fireworks take the time and effort to incorporate or to form a Limited Liability Company they would more than likely be protected to a significant degree from such personal injury CITATION All13 \l 1033 (Business, 2013) Should these contracts come into being, Acme Fireworks will need to hire more employees. But which type of employee should Acme Fireworks employ? The full-time employee works regular and on-going, between 35-45 hours a week, which includes non-wage entitlements and benefits like paid holiday leave, sick leave, and long service leave CITATION ASU14 \l 1033 (ASU, 2014). Part-time permanent work is regular and on-going, involves fewer hours than full-time and usually has set days or set hours. No benefits and entitlements are received by part-time employees. Casual work is on-going and involves irregular hours and hourly pay. Casual workers work on an as needed basis, which means that they work when they are needed CITATION ASU14 \l 1033 (ASU, 2014). There are no entitlements for casual workers since the entitlements are factored into 20% of the higher hourly rate that casual workers receive CITATION ASU14 \l 1033 (ASU, 2014). Casuals usually receive hourly rates of pay based on a minimum 15% loading of normal or applicable hourly rates of pay CITATION ASU14 \l 1033 (ASU, 2014). Fixed term or contract employees are hired for a fixed period of time for a specific project or to replace an employee on sick leave or paternal leave CITATION ASU14 \l 1033 (ASU, 2014). This type of employee would need an agreement in writing that sets out the length of the employment contract. Fixed term employees are entitled to the same annual personal and other leave as  full-time employees, but on a proportional basis for the period of their employment CITATION ASU14 \l 1033 (ASU, 2014) Piecework and commission only payment employees rather than being paid a wage or salary are paid by: Piecework – the paying f a specific amount for completing a specific task. Commission – the paying of a percentage for each sale made Retainer plus commission – the paying of a fixed amount plus commission. Should Acme Fi reworks decide to hire more employees, my suggestion would be to hire casual workers. Casual workers do not expect to work all the time they work when they are needed. They would not have to give them any entitlements just work. Should Acme Fireworks become so busy that they are working everyday then they might want to get some full time workers. But, as of right now go with the casual workers. Acme Fireworks has been a sole proprietorship since it began two years ago. As a sole proprietorship all liabilities for finances and operations are on the owner. The owner’s personal property is tied to the business, so the owner assumes a risk against his personal property should the business experience financial hardship. Profits and losses of the business are reported through the owner and are taxed at the individual rate. The sole proprietorship entity is the easiest entity to set up, but the owner will probably have to sell the business to retrieve his investment. Should Acme Fireworks become a partnership? A partnership has two or more owners that share equal control, unless the partnership agreement says otherwise or the entity is set up as a limited partnership CITATION Phi14 \l 1033 (Phillips, 2014). Like a sole partnership, profits and losses of the business flow through the partners and are taxed at the individual rate. Operating partners assume risks, both legally and financially. Creditors can attempt to collect debts from the partner’s personal assets CITATION Phi14 \l 1033 (Phillips, 2014). To recoup their investment the partner is required to sell his interest in the business. With the potential for devastatingly high personal injury claims, this entity would not be the one for Acme Fireworks. This entity jeopardizes the personal assets of the businesses owners. A corporation? A corporation can have an unlimited number of owners, known as shareholders. This business entity remains separate from the owners in legal and financial matters CITATION Phi14 \l 1033 (Phillips, 2014). The profits and losses of a corporation are taxed at corporate rates, not individual rates. Should the  corporation realize a profit it is paid out to the shareholders who then report it as income and pay taxes on it at an individual rate CITATION Phi14 \l 1033 (Phillips, 2014). Corporations are taxed twice, once at the time of profits and losses and then again when the shareholders realize the dividends. Or a limited liability company? This entity is a partnership and a corporation mixed together. Owners are protected from personal liability like a corporation, but enjoy the tax advantages similar to a partnership. The LLC would be the entity I would suggest for Acme Fireworks due to the ability to be free from personal liability and the ability to be taxed at the lower partnership rate. References: BIBLIOGRAPHY \l 1033 ASU. (2014). Employment Type Defin itions Eligibility Summary. Retrieved from ASU: http://www.asu.edu Business, A. (2013, July 13). Fireworks Displays. Retrieved from Avoiding Personal Liability: http://www.allbusiness.com Denton, G. . (2012). Thwe difference between a contract that falls undert the UCC and one that does not and why it is important to you. Retrieved from Gunderson Denton at Law: http://www.gundersondenton.com/business/difference-contract-falls-ucc-important Phillips, C. (2014). Three Types of Business Entity. Retrieved from Small Business: http://www.smallbusiness.chron.com Rogers, S. (2012). Essentials of Bussiness Law. San Diego: Bridgepoint Education, Inc.

African American Hate Crimes in Gwendolyn Brook’s Poetry Essay

The murder of Michael Brown in Ferguson, Missouri , the murder of a black teen for playing loud music in Florida, the Little Rock integration and all other forms of abuse or hate crimes done against African Americans will always be engraved in our history and in the hearts of all African Americans as a period of injustice. It was a common tragedy to lose a family member to one of the many riots assembled by the Ku Klux Klan or simply by a group of Caucasians determined to exterminate â€Å"niggers.† Many were able to see how detrimental hate crimes were through media. African Americans who owned magazines, newspapers and so forth were finally able to voice their opinions and tell their side of the story to balance out the usually biased media run by Caucasians. As a result of the exposed cruelty towards African Americans, blacks felt justified, some whites became enraged, and yet other whites began to feel guilty for devaluing the lives of African Americans. Brooks’s ballad â€Å"A Bronzeville Mother Loiters in Mississippi. Meanwhile, a Mississippi Mother Burns Bacon† illuminates the hate crime committed against a young African American boy and the guilt that consumes the speaker after she realizes her involvement caused his death. Brooks’s poem acts as a metaphor to convey how America (during the period of injustice) attempted to overlook the truth of the immoral crimes committed against African Americas, but as a result of publicized brutality, realized they were wrong. Background information regarding the death of Emmett Till will allow the reader to better understand how Brooks uses the ballad as a metaphor to represent Americas attempt to overlook the immoral acts committed against African Americans. According to â€Å"The Murder of Emmett Till,† an article addressing Emmett Till’s death and the media coverage on it, Till’s death was a prank gone wrong. â€Å"After picking cotton with his cousins all day, Till and his cousins took a joy ride with the family car to Bryant’s Grocery store where his cousins dared him to talk Carolyn Bryant (Brian). What happened as he was leaving is fiercely debated. Some white witnesses claimed he either said, "Bye, baby," or whistled at her, while others say that she became enraged after he simply put his change in the womans hand. Emmett Till’s alleged â€Å"fresh behavior† spread like wildf... ...acism seen in closed-minded individuals through Brooks’s use of fairy tale language and the depiction of the husband. Likewise, America is made up of both types of individuals, and through the use of publicized media, we can only hope to increase the knowledge of the senseless violence we known as hate crimes. After reading Brook's ballad one can only hope that Emmett Till and other victims of hate crimes will act as a reminder and provide an inclining of hope that another tragic death will not follow. Works Cited Brooks, Gwendolyn. â€Å"A Bronzeville Mother Loiters in Mississippi. While Mississippi Mother Burns Bacon.† Selected Poems. New York: Harper Perennial Modern Classics, 2006. Print. Favat, F. Andrà ©.. Child and Tale: The origins of Interest. Urbana, Ill.: National Council of Teachers of English, c1977. Print. Mootry, Maria K. â€Å"Brook’s a bronzeville mother loiters in Mississippi. Meanwhile, a Mississippi mother burns bacon.† Explicator 42.4 (1984): p51, 2p Academic Search Complete. Web. 13 July 2011. Thorton, Brian. The Murder of Emmett Till. Journalism History 36.2 (2010): p396-104, 9p Academic Search Complete. Web. 13 July 2011.

Cost-Salvage Value/Total units of production Essay

Salta Company installs a manufacturing machine in its factory at the beginning of the year at a cost of $87,000. The machine’s useful life is estimated to be 5 years, or 400,000 units of product, with a $7,000 salvage value. During its second year, the machine produces 84,500 units of product. Determine the machines’ second year depreciation under the units of production method: Answer: $16,900 Cost-Salvage Value/Total units of production (87,000 – 7,000)/400,000 = .2 .2 * 84,500 = 16,900 Amortization: Answer: Is the systematic allocation of the cost of an intangible asset to expense over its estimated useful life. Big River Rafting pays $310,000 plus $15,000 in closing costs to buy out a competitor. The real estate consists of land appraised at $105,000, a building appraised at $210,000 and equipment appraised at $35,000. Compute the cost that should be allocated to the land. Answer: $97,500 105,000 + 210,000 + 35,000 = 350,000 105,000/350,000 = .3 .3 * 325,000 = 97,500 Leasehold: Answer: are the rights granted to the lessee by the lessor of a lease. Copyright: Answer: Gives its owner the exclusive right to publish and sell a musical or literary work during the life of the creator plus 70 years. A patent: Answer: Gives its owner exclusive right to manufacture and sell a patented item or to use a process for 20 years. Carmel Company acquires a mineral deposit at a cost of $5,900,000. It incurs additional costs of $600,000 to access the deposit, which is estimated to contain 2,000,000 tons and is expected to take 5 years to extract. Compute the depletion expense for the first year assuming 418,000 tons were mined. Answer: $1,358,500 5,900,000 + 600,000 = 6, 500,000 Cost – Salvage Value/ Total Units of Capacity 6,500,000-0/2000000 = 3.25 3.25 * 418,000 = 1,358,500 Cambria Company reports net sales of $4,315 million; cost of goods sold of $2,808 million; net income of 283 million; and average total assets of $2,136. Compute its total asset turnover. Answer: 2.02 Net Sales/Average Total Asset 4,315/2,136 = 2.02 Salta Company installs a manufacturing machine in its factory at the beginning of the year at a cost of $87,000. The machine’s useful life is estimated to be 5 years, or 400,000 units of product, with $7,000 salvage value. During its second year, the machine produces 84,500 units of product. Determine the machine’s second year depreciation under the straight-line method. Answer: $16,000 Cost – salvage value/useful life in periods 87,000 – 7,000/5 =16,000 A depreciation asset costing $75,000 is purchased on September 1, year 1. The asset is estimated to have a salvage value of $10,000 and an estimated useful life of 4 years. Double-declining-balance depreciation is used. If the asset is sold on December 31, Year 3 for $13,000, the journal entry to record the sale will include: Answer: A debit to loss on sale for $2,625. Chapter 11 Quizzes The current FUTA tax rate is 0.8% and SUTA tax rate is 5.4%. Both taxes are applied to the first $7,000 of an employee’s pay. Assume that an employee earned $8,900. What is the amount of total unemployment taxes the employer must pay on the employee’s wages? Answer: 434.00 7,000*5.4% = 378 7000*0.8% = 56 378 + 56 = 434 FICA taxes include: Answer: Social Security taxes Liability: Answer: Must sometimes be estimated If the times interest ratio: Answer: Increase then the risk decreases. Gross pay is? Answer: Total compensation earned by an employee before any deductions. A company’s income before interest expense and taxes is $250,000 and its interest expense is $100,000. It’s times interest earned ratio is: Answer: 2.50 Income before Interest expense and income taxes/Interest Expense 250,000/100,000 = 2.50 Employee vacation benefits: Answer: are estimated liabilities The amount of federal income taxes withheld from an employee’s paycheck is determined by: Answer: the amount of the employee’s current earnings for the pay period and number of withholding allowances the employee claims. Amount received in advanced from customers for future products or services: Answer: are liabilities A company estimates that a warranty expense will be 4% of sales. The company’s sales for the current period are $185,000. The current period’s entry to record warranty expense is: Answer: Debit warranty expense $7,400; credit estimated warranty liability $7,400 185,000*4% = 7,400 An employee earned 62,500 during the year working for an employer. The FICA tax rate for social security is 6.2% and FICA tax rate for Medicare is 1.45%. The current FUTA tax rate is 0.8% and SUTA is 5.4%. Both unemployment taxes are applied to the first $7,000 of an employee’s pay. What is the total unemployment taxes does the employee have to pay? Answer: $0.00 Employees do not pay unemployment taxes. FUTA taxes are: Answer: unemployment taxes Arena Company’s salaried employee’s earned two weeks’ vacation per year. It pays $858,000 in total employee salaries for 52 weeks but its employees work only 50. Record Arena Company’s weekly journal entry to record the vacation expense; Answer: Debit vacation benefits expense $17,160; Credit vacation benefits payable $17,160 858,000/50 = 17,160 A company sells computers at a selling price of $1,800 each. Each computer has a 2 year warranty that covers replacement of defective parts. It is estimated that 2% of all computers sold will be under the warranty at an average cost of $150 each. During November the company sold 30,000 computers and 400 computers were serviced under the warranty at total cost of 55,000. The balance is the estimated warranty liability account at November 1 was $29,000. What is the company’s warranty expense for the month of November? Answer: 90,000 (30,000*2%*150) = 90,000 A company had fixed interest expense of $6,000, its income before interest expense and any income taxes is $18,000, and its net income is $8,400. The company’s Times interest earned ratio equals: Answer: 3.0 Advanced ticket sales totaling $6,000,000 cash would be recognized as follows: Answer: Debit Cash; Credit Unearned Revenue During August, Arena Company sells $356,000 in product that has a one year warranty. Experience shows that warranty expenses average about 5% of the selling price. The warranty liability account has a balance of $12,800 before adjustment. Customers returned product for warranty repairs during the month that used $9,400 in parts and repairs. The entry to record customer warranty repairs is: Answer: Debit Estimated Warranty Liability $9,400; credit Parts Inventory $9,400 Obligations not expected to be paid within the longer of one year or the company’s operating cycle is reported as: Answer: Long-term liability Times Interest earned computation is: Answer: (Net Income + Interest expense + Income taxes)/Interest expense The difference between the amount received from issuing a note payable and the amount repaid is referred to as: Answer: Interest A contingent Liability: Answer: is a potential obligation that depends on a future event arising from a past transaction or event. In the accounting records of a defendant, lawsuits: Answer: should be recorded if payment for damages is probable and the amount can be reasonably estimated. A company’s fixed interest expense is $8,000 its income before interest expense and income taxes is $32,000. Its net income is $9,600. The company’s time’s interest earned ratio equals: Answer: 4.0 An Estimated Liability: Answer: Is a known obligation of an uncertain amount that can be reasonably estimated. Recording employee payroll deduction may involve: Answer: Liabilities to individual employees, Liabilities to federal and state governments, Liabilities to insurance companies, and Liabilities to labor unions. Chapter 12 Quizzes Kevin and Jeannie formed This & That as a limited liability company. Unless the member owners elect to be treated otherwise, the IRS will tax the LLC as: Answer: a partnership A partnership that has two classes of partners, general and limited, where the limited partners have no personal liability beyond the amounts they invest in that partnership, and no active role in the partnership, except as specified in the partnership agreement is a: Answer: Limited Partnership Groh and Jackson are partners. Groh’s capital balance in the partnership is $64,000, and Jackson’s capital balance is $61,000. Groh and Jackson have agreed to share equally in income and loss. Groh and Jackson agree to accept Block with a 20%interest. Block will invest $35,000 in the partnership. The bonus that is granted to Groh and Jackson equals: Answer: $1,500 1.64,000 + 61,000=125,000 2. 125,000 + 35,000=160,000 3. 160,000*20%= 32,000 4.35,000 – 32,000 = 3,000 5. 3,000*1/2= 1,500 Badger and Fox are forming a partnership. Badger invests a building that has a market value of $350,000; the partnership assumes responsibility for a $125,000 note secured by a mortgage on the property. Fox invest $100,000 in cash and equipment that has a market value of $75,000. For the partnership the amount recorded for Badgers capital and Fox’s capital are: Answer: Badger $225,000 and Fox $175,000 Badger 35,000-125,000 = 225,000; Fox 100,000 + 75,000 = 175,000 Regina Harrison is a partner in Pressed for Time. An analysis of Regina’s capital account indicates that during the most recent year, she withdrew $20,000 from the partnership. Her share of the partnership’s net loss was $16,000 and she made an additional equity contribution for $10,000. Her capital account ended the year at $150,000, what was her capital balance at the beginning of the year? Answer: $176,000 10,000 – 16,000 – 20,000 = -26,000 150,000 – (-26,000) = 176,000 Collins and Farina are forming a partnership Collins is investing in a building that as market value of $80,000. However the building carries a $56,000 mortgage that will be assumed by the partnership. Farina is investing $20,000 cash. The balance of Collins capital Account will be: Answer: $24,000 80,000 – 56,000 = 24,000 A partnership in which all partners have mutual agency and unlimited liability is called: Answer: General Partnership In the absence of a partnership agreement, the law says that income (and loss) should be allocated based on: Answer: Equal shares Groh and Jackson are partners. Groh’s capital balance is $64,000 and Jackson’s capital balance is $61,000. They have agreed to share equally in income or loss. Groh and Jackson agree to accept Block with a 25% interest. Block will invest $35,000 in the partnership. The bonus that is granted to Block equals: Answer: 5,000 64,000 + 61,000 = 125,000; 125,000 +35,000 = 160,000; 160,000*25% = 40,000; 40,000 – 35,000= 5,000 Nee High and Low Jack are partners. They share income and loss equally. Highs beginning partnership capital balance for the current year is $285,000 and Jack’s is $370,000. The partnership had net income of $250,000 for the year. High withdrew $90,000 and Jack withdrew $100,000. What is Jack’s return on equity? Answer: 41.3% A partnership agreement: Answer: is binding even if it is not in writing. A partnership designed to protect innocent partners from malpractice or negligence claims resulting from acts of another partner is: Answer: Limited Liability Partnership Partner’s withdrawals of assets are: Answer: Debited to their withdrawals account Sam, Bart, and Alex are dissolving their partnership. Their partnership agreement allocates each partner 1/3 of all income and losses. The current period’s capital account balances are Sam, $45,000; Bart, $37,000; and Alex, $(5,000). After all assets are sold and liabilities are paid, there is $77,000 in cash to be distributed. Alex is unable to pay the deficiency. The journal entry to record the distribution should be: Answer: Debit Sam, Capital $42,500; Debit Bart, Capital $37,000; Credit Cash $77,000 Smith, West, and Krug form a partnership. Smith contributes $180,000, West contributes $150,000 and Krug contributes $270,000. Their partnership agreement calls for the income or loss division to be based on the ratio of capital invested. If the partnership reports income of $175,000 for its first year, what amount of income is credited to Smith’s capital account? Answer: $52,500 Smith 180,000/600,000 = .3 .3 * 175,500 = 52,500 Smith, West and Krug form a partnership. Smith contributes $180,000, West contributes $150,000, and Krug contributes $270,000. Their partnership agreement calls for the income and loss division to be based on the ratio of capital invested. If the partnership reports income of $175,000 for its first year, what amount of income is credited to Krug’s capital account? Answer: $78,750 Krug 270,000/600,000 = .45 .45 * 175,000 = 78,750 Smith, West, and Krug form a partnership. Smith contributes $180,000, West contributes $150,000, and Krug contributes $270,000. Their partnership agreement calls for a 5% invest allowance on the partner’s capital balances with the remaining income or loss to be allocated equally. If the partnership reports income of $174,000 for its first year, what amount of income is credited to West’s capital account? Answer: $55,500 Smith, West, and Krug form a partnership. Smith contributes $180,000, West contributes $150,000and Krug contributes $270,000. Their partnership agreement calls for a 5% interest allowances on the partner’s capital balances with the remaining income or loss to be allocated equally. If the partnership reports income of $174,000 for its first year, what amount of income credited to Krug’s capital account? Answer: Badger and Fox are forming a partnership. Badger invests a building that has a market value of $350,000; the partnership assumes responsibility for a $125,000 note secured by a mortgage on the property. Fox invests $100,000 in cash and equipment that has a market value of $75,000. For the partnership, the amounts recorded for total assets and for total capital account are: Answer: In a partnership agreement, if partners agreed to an interest allowance of 10% annually on each partner’s investment, the interests allowance: Answer: Can make up for unequal capital contributions When a partner is unable to pay a capital deficiency: Answer: The deficiency is absorbed by the remaining partners before distribution of cash. Chase and Hatch are partners and share equally in income or loss. Chase’s current capital balance is $135,000 and Hatch’s is $120,000. Chase and Hatch agree to accept Flax with a 30% interest in the partnership. Flax invests $115,000 in the partnership. The amount credited to Flax’s capital account is: Answer: $111,000 135,000 +120,000 = 255,000 255,000 + 115,000 = 370,000 370,000*30% = 111,000 Chase and Hatch are partners and share equally in income or loss. Chase’s current capital balance is $135,000 and Hatch’s is $120,000. Chase and Hatch agree to accept Fax with a 30% interest in the partnership. Flax invests $115,000 in the partnership. The balances in Chase’s and Hatch’s capital accounts after admission of the new partner equal: Answer: The following information is available regarding John Smith’s capital account in Technology Consulting Group, a general partnership, for a recent year: Beginning of the year balance $22,000 His share of partnership income $8,500 Withdrawals made during the year $6,000 What is smith’s partner return on equity during the year in question? Answer: 36.6% 22,000+8,500-6,000=24,500 8,500/(22,000+24,500)/2=.3655=36.6%