Booker Jones Analysis Essay Example for Free

Booker Jones Analysis taste1.A. If the cost of set were to be incorporated into the stock-taking account (balance sheet), therefore the cost of barrels utilise (Income line) can be reduced. From 1960-1961, Booker Jones increased its barrels produced from 43,000 barrels to 63,000 barrels. That is 20,000 barrel increased in equitable one year. The cost per barrels is $31.50. (20,000 * 31.50= $630,000)We can reduce the cost per barrel expense from income statement of $630,000. (-407,000+630,000= 223,000) Therefore, pretax addition would have been $223,000 instead of net loss of $407,000.B. If the change were made retroactively as of June 1, 1959 then arrange on the balance sheet at the end of 1960Number of barrel in inventory in 1960 is 172,000(172,000 barrels * . 50 = 5,418,000)$5,418,000 is the increased inventory after incorporated the cost of barrels to inventory. ($5418000 + $4,506,000 = $9,924,000)$9,924,000 is the new end inventory in 1960Deferring the Aging costs i nto the inventory balance would increase the Net bring in in 1960. This would then increase the Retained Earnings account on the balance sheetEffect on the balance sheet at the end of 1961Number of barrels in inventory in 1961 is 192,000(192,000 barrels * $31.50 = $6,048,000)$6,048,000 is the increased in inventory after incorporating the cost of barrels to inventory ($6,048,000 + $5,030,000 = $11,078,000)$11,078,000 is the new ending inventory in 1960Deferring the Aging costs into the inventory balance would increase the Net Profit in 1960. This would then increase the Retained Earnings account on the balance sheetEffect on the income statement for 19602. We do not believe that Jones went from a profit in 1960 to a loss for1961 because they can trespass the patented barrels as inventory instead of expense it. Because of the 4 years aging life, it makes sensation to capitalize the barrels and expense it as the aging process reduced.7.1. The original Levis Store conduct has a hig her return on invested capital, meaning it is a good investment in a long run.Column1WholesaleChannelEstimateOriginal LevisStore ChannelEstimateOperating Profit before Tax46Tax at 40%1.62.4NOPAT2.43.6Fixed Asset factory PPE55Distributed PPE12Total Fixed Asset67Non- money workings CapitalCurrent Asset812Current Liability11Cash00Total Non-Cash Working Capital711Invested Capital1318Return on Invested Capital18%20%2. Value Chain AnalysisProviding strategic counselor corporate strategyProvide the perfect fit jean for customersMarket segment for unsatisfied customers exsert market segment by offering customized jeansGenerating customer shoot sales, marketing and customer service cast up in profit24% unsatisfied customersProvide more styles, more colors, better fits4224 possible compounding of measurement400 prototype pairs stock at Kiosk for customers to try onFulfilling customer demand supply chain, manufacturing, production Order is transmitted directly to Levis factory. Each pa ir of jeans is individually love 3 days shipping back to customers (at $5 extra charge per pair) Pull based responsiveness to actual buying patterns, improve manufacturing, and delivery cycle Need to find ways to fix the 8 months lag between ordering cotton fabric and selling the final pair of jeans. Providing support go Finance, HR, legal and compliance Need additional finance to pay for trained personal clerksNeed to concur out loan to finance initial investment of the project In 4 retail inject locations