What managerial accounting tools could be used by Giant Eagle to evaluate whether it should put refrigerator doors in its dairy section?

file-4-9Giant Eagle is a grocery store chain with stores located in Indiana, Maryland, Ohio, Pennsylvania, and West Virginia. Recently, it installed refrigerator doors on the dairy section in many of its stores. Previously, the dairy section was refrigerated but had no doors.

The refrigerator doors will reportedly use 78% less energy than the amount of energy used when there are no doors on the dairy section.

Questions

  1. What factors could be relevant in Giant Eagle’s decision about whether to install the dairy doors or not? List as many factors as you can think of; use your imagination.
  2. Of the factors you listed in Question 1, which are qualitative in nature? Which are quantitative considerations?
  3. What managerial accounting tools might be used by Giant Eagle in evaluating whether to purchase and install the dairy doors? Again, list as many tools as might be useful.
  4. Of the tools you listed in Question 3, what tool would you consider would be most useful? Why?

Instructor Resources

These resources are provided to give the instructor flexibility for use of Accounting in the Headlines articles in the classroom. The blog posting itself can be assigned via a link to this site OR by distributing the student handout below. Alternatively, the PowerPoint file below contains a bullet point overview of the article and the discussion questions.

  • Student handout (pdf) (word) (contains entire blog posting + discussion questions)
  • PowerPoint file (brief article overview + discussion questions)

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 3.0 Unported License.

About Dr. Wendy Tietz, CPA, CMA, CGMA

Dr. Wendy Tietz is a professor of accounting at Kent State University in Kent, Ohio, USA. She is also a textbook author with Pearson Prentice-Hall.

No comments yet... Be the first to leave a reply!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: