Question
footwear online at the company’s website.
15. Assume a company’s Income Statement for Year 12 is as
follows:
Warehouse expenses are 5.4% of net revenues .
Cost of pairs sold are 53.6% of net revenues .
Interest expenses are 3.6% of net revenues.
Marketing costs are 10.9% of net revenues.
Administrative expenses are 2.9% of net revenues.
16. Based on information on the Help Screen for the Plant
Operations Report (see the Plant Investment section), if a company
adds new plant capacity at a cost of $50 million, then its annual
depreciation costs will rise by
4% or $2,000,000.
10% or $5,000,000.
20% or $10,000,000.6%
or $3,000.000.5%
or $2,500,000.
Last question, can’t see the number:
Which of the following statements about striving to reduce
labor costs per pair produced at eachof the company’s plants is
true?A company cannot achieve labor costs per pair produced that
are close to the lowest in theindustry (in those geographic regions
where it has plants) unless its annual totalcompensation of plant
workers is below the average annual total compensation paid by
allcompanies with plants in these same regions.
It is more cost effective for a company to compensate plant
workers at levels that are close tothe highest in the industry in
each geographic region where it has plants than it is for acompany
to pursue actions to keep labor costs per pair produced below the
industry averagein each geographic region where it has plants.
A company pursuing a low-cost provider strategy is better
able to pursue actions aimed atachieving low labor costs per pair
produced in each of its plants (as compared to the laborcosts of
companies with plants in the same regions) than is a company
pursuing adifferentiation strategy.
It is very difficult for a company producing branded footwear
with a high S/Q rating to achievelabor costs per pair produced that
are below the industry average in each geographic regionwhere the
company has plants.An companies, regardless of the strategy being
employed, should pursue actions tomanage employee compensation and
labor productivity in a manner that results inlabor costs per pair
produced that are equal to (or very close to) the industry-low
ineach region where the company has plants.
An companies, regardless of the strategy being employed,
should pursue actions tomanage employee compensation and labor
productivity in a manner that results inlabor costs per pair
produced that are equal to (or very close to) the industry-low
ineach region where the company has plants.
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