American Airlines Group (AAL), the world’s biggest airline, has been reporting record profits in recent quarters. United Continental Holdings and Southwest Airlines also reported record profits. Part of what has contributed to the record profits has been the decline in the cost of oil. The price of oil has fallen during 2014; we are spending […]
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Tag Archives: managerial accounting;
How should the French grocer, Intermarché, set prices for ugly produce?
December 23, 2014 
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At least one third of fresh produce is discarded, according to estimates from the United Nations Environment Programme (see “Students from France, Mexico and United Kingdom Recognized for Taking up Fight against Food Waste,” United Nations Environment Programme, December 16, 2014, http://www.unep.org/newscentre/Default.aspx?DocumentID=2814&ArticleID=11110&l=en .) Some of the produce is discarded because it is less than perfect […]
Continue readingHow does the change in selling price impact the break even point for Amazon’s Fire Phone?
November 18, 2014 0 Comments
In July of 2014, Amazon came out with a smartphone, the Amazon Fire phone. The phone sports 3-D visuals and is tightly integrated into the Amazon ecosystem. For example, the Firefly feature can scan and recognize over 70 million products that the consumer is able to purchase or look up immediately from his or her […]
Continue readingHow does the use of a robotic shopping assistant impact the breakeven point and operating leverage at Lowe’s?
November 12, 2014 0 Comments
Lowe’s, a U.S.-based chain of retail home improvement stores, is introducing a robotic shopping assistant into its Orchard Supply Hardware store in San Jose, California. The robot, called OSHbot, will greet customers and assist customers in finding products. In addition, the robot has one large screen on the front and one on the back. The […]
Continue readingShould the original cost of the planes for Afghanistan’s air force purchased by the U.S. Air Force influence its decision to scrap those planes?
October 31, 2014 0 Comments
The U.S. Air Force recently destroyed 16 transport planes (refurbished G222 planes) that it had purchased for $486 million in 2011. These transport planes were to be used by Afghanistan’s air force but were abandoned due to persistent high maintenance costs. An Afghanistan company paid $0.06 per pound for the scrap, or a total of […]
Continue readingHow should the cost of national advertising by Whole Foods impact the performance report (and segment margin) for each store?
October 24, 2014 0 Comments
Whole Foods Market, Inc., is a supermarket chain based in Austin, Texas, with 381 stores in the US (it also has stores in the UK and Canada.) Whole Foods specializes in natural and organic food and has annual sales of $13 billion. In October 2014, Whole Foods rolled out its first national advertising campaign in […]
Continue readingHow does outfitting AMC movie theaters with recliners affect the company’s break even point and operating leverage?
July 18, 2014 0 Comments
AMC Entertainment Holdings Inc. is spending millions of dollars to install recliner-seating in its theaters. AMC Entertainment Holdings Inc. is outfitting about 1,800 of its nearly 3,000 auditoriums with recliners for a total cost of about $600 million. The recliners will remove up to two-thirds of the seating capacity in each theater, due to […]
Continue readingHow does automated technology in fast food restaurants change the cost structure, break even, and degree of operating leverage?
June 18, 2014 0 Comments
Change is rapidly occurring in the restaurant industry due to a combination of higher labor costs, increased technological capabilities, and other factors. Protesters across the world are calling for fast food restaurants to raise their wages, arguing that the current wages paid to workers are not enough to survive on. Various states and cities have […]
Continue readingWhat are the direct and indirect costs involved with manufacturing Oscars?
May 12, 2014 0 Comments
The Academy Awards is an annual American awards ceremony honoring achievements in the film industry. Winners receive a statue officially named the “Academy Award of Merit.” However, these statues are much better known by the nickname of “Oscars.” Each Oscar statue weighs 8.5 pounds and takes three to four weeks to manufacture. The statues have […]
Continue readingWhy might Ford be shifting some jobs from Mexico to the United States?
May 1, 2014 0 Comments
Ford is moving production of its 2016 Ford F-650 and F-750 medium-duty trucks to its Ohio Assembly Plant in Avon Lake, near Cleveland, Ohio. Currently those medium-duty trucks are produced in Mexico. Ford will be investing $168 million in the Avon Lake facility to retool the plant since it is currently set up to produce […]
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