ISCOM424 - Supply Chain Complexities
ISCOM424 - Supply Chain Complexities
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This 0 page Study Guide was uploaded by kimwood Notetaker on Saturday November 7, 2015. The Study Guide belongs to a course at a university taught by a professor in Fall. Since its upload, it has received 16 views.
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Date Created: 11/07/15
Bus630 Managerial Accounting Professor Gregory Goussak Lawanda M Bishop 09302012 1 What is Dell s strategy for success in the marketplace Does the company rely primarily on a customer intimacy operational excellence or product leadership customer value proposition What evidence supports your conclusion Dell s business strategy combines its direct customer model with highly efficient manufacturing and supply chain management organization and an emphasis on standard based technologies This type of strategy enables Dell to provide customers with superior value high quality relevant technology customized systems superior service and support and products and services that are easy to buy and sell Customer intimacy is saying You should choose Dell because they can deliver products and services faster and more conveniently at a lower price The operation excellence is saying You should choose Dell because they can deliver products and services at a more convenient and lower price than their competitors The product leadership is saying You should choose Dell because they offer high quality products better than their competitors Having a direct relationship with the customers is the most efficient path Dell is a low cost leader that provides single point of accountability for its customers 2 What business risks does Dell face that may threaten its ability to satisfy stockholder expectations What are some examples of control activities that the company could use to reduce there risks Dell may face a failure on the part of Dell to effectively manage a product transition that will directly affect the demand for Dell s products and the profitability of Dell s operation Dell may also be unable to satisfy their stockholders expectations Dell has to keep up with technology advances and changes With Dell being a technological provider to consumers they must have the latest technology to keep up with its competitors Dell should research and evaluate new technologies Control activities that the company can use to reduce these risks are to hire the best talent in the field of technology and to continuously invest their earnings into research and development 3 How as the SarbanesOxley Act of 2002 explicitly affected the disclosures contained in Dell s 10K report The SarbanesOxley Act of 2002 explicitly affected the disclosures because it states that the annual report must contain an internal control report and that independent accountants have to certify the company s internal control over its financial reporting 4 Is Dell a merchandiser or a manufacturer What information contained in the 10K supports your answer Dell is a manufacturer Its inventory balance contains items a merchandiser would not have such as finished goods production materials and workinprocess 5 What are some examples of direct and indirect inventoriable costs for Dell Why has Dell s gross margin in dollars steadily increased from 2003 to 2005 yet the gross margin as a percentage of net revenue only increased slightly Examples of indirect inventoriable costs are labor for computer products and materials Indirect inventoriable costs are depreciation costs of equipment and manager s salaries Dell s gross margin steadily increased from 2003 to 2005 Although the gross margin As a percentage of net revenue only increased slightly over the period of three years an indirect cost may have increased causing the direct costs to decrease and effect the bottom line 6 What is the inventory balance on Dell s January 28 2005 balance sheet Why is the inventory balance so small compared to the other current asset balances What competitive advantage does Dell derive from its low inventory levels Is this a good sign for Dell or a bad sign Why The inventory balance on Dell s January 28 2005 balance sheet is 459 The inventory balance is smaller compared to the other current asset balances because it is based on the demand for that particular period Dell has a competitive advantage with low inventory because they are able to produce a custombuilt product for the customer It is not good that Dell has a negative Cash Conversion Cycle consistently Although it s low the negative numbers that re ect there is a disconnect between the direct labor manufacturing overhead in creating the final product 7 Describe some of the various types of operating expenses incurred by Dell Why are these expenses treated as period costs Some of the various types of operating expenses incurred by Dell was the operating costs Selling general and administrative as well as researcher development and engineering These costs are all associated with the perspective period on the income statement As these operating costs are accured or incurred they are allocated for its designated period and labeled as period costs 8 List four different cost objects for Dell For each cost object mention one example of a direct cost and an indirect cost 1 Warranties are direct costs associated with the production of the product because each comes with a standard manufacture warranty which is honored by Dell Dell has to account for this cost each quarter and adjust as necessary 2 Shipping Costs are indirect costs associated with the geographical area in which the products are produced and shipped 3 Research Development and Engineering Costs are direct costs associated with payroll contractor fees and administrative expenses 4 Website Development Costs are indirect costs associated with the maintenance and minor enhancement to the features and functionality of its websites References Garrison R Noreen E amp Brewer P 2010 Managerial Accounting 13 ed New York IrwinMcGraw Hill
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