In this assignment, you are a consultant making data supported recommendations to a client who desires to meet a specific profit goal (income after tax).?You wi
In this assignment, you are a consultant making data supported recommendations to a client who desires to meet a specific profit goal (income after tax). You will :
1. Create your own original EXCEL file with price and cost data from the case, separately showing all variable cost items (costs that vary with the number of units produced) all fixed cost items (costs that are incurred independent of the number of units produced) , and the client's current price per UNIT and number of UNITS sold.
2. In the same Excel file, create a contribution income statement, using the format in the case, (i.e., showing price x units sold (revenue), variable costs x units sold (total variable costs), contribution per unit and total contribution; total fixed costs. income before and after tax.
3. Calculate breakeven units at current price
4. Calculate the revenue required to meet income target after tax (profit)
5. First decision: Raise price? Calculate the price per unit needed to reach the required income target (keeping the current volume of units sold). Explain why this might or might not be a good choice.
6. Second decision: Increase volume? Calculate the units to be sold (volume) under current pricing in order to reach target income. Explain why this might or might not be a good choice.
7. Determine whether it is best to adjust price or volume in order to reach the client's target income Compare the options and explain the rationale for your choice
8. Prepare a narrated PowerPoint presentation to your client, summarizing your findings, your comparative analysis and your recommendations. The narration should thoroughly reflect the logic of your analysis and will be evaluated based on the quality of this “written” communication. (See the below instructions on how to prepare a narrated PowerPoint presentation.
Refer to the PowerPoint presentation below, "Jewelry Case Hints" for specific guidance through your analysis.
Submit your Excel file in your assignment folder: that contains the above analyses. Title your file, "Excel case week 4."
Submit your PowerPoint presentation in your assignment folder and title it “Presentation to Client, week 4
Rubric for week 4 Individual Break Even analysis
Competencies: Critical thinking, Communication, Strategy development
MBA outcomes: (1) Communicate clearly in writing and speaking; (2) Apply logical processes to formulate clear, defensible ideas; (3) Use mathematical information, operations, and quantitative analyses to solve problems and inform decision-making; (10) Plan, evaluate, and manage the financial implications of the organization’s operations.
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Criteria |
Proficiency Scoring categories Highly proficient – 90-100% Proficient – 80-89% Developing Proficiency- 70-79% Low/No Proficiency- 0-69% |
Weighted score |
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A. Format: Executive Summary,Introduction and Conclusion (10%) · Summary brings out the substance of the report, explaining major recommendations and their logic, · Introduces the topic, its relevance to the discipline and to the appropriate audience · Introduction lays the groundwork for the direction of the paper · Conclusions are precise and strongly supported within the paper |
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B. Critical thinking factors (20%) show you can apply logical processes to formulate clear and defensible ideas based on analysis of facts and ethical considerations · Identify and clearly explain the issue, question or problem under critical consideration · Locate and access sufficient information to investigate the issue or problem · Evaluate the information in a logical and organized manner to determine its value and relevance to the problem · Consider and analyze information in context to the issue or problem: · Develop well reasoned ideas, conclusions, or decisions, checking them against relevant criteria and benchmarks, and in accordance with assignment instructions |
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C. Communication factors (20%) show you can Communicate clearly in writing: · Organize document clearly in a manner that promotes understanding and meets the requirements of the assignment · Develop coherent paragraphs or points so that each is internally unified as part of the whole document. · Provide sufficient, correctly cited support that substantiates the writer’s ideas · Tailor communications to the audience · Follow conventions of Standard Written English. · Create neat and professional looking documents appropriate to the project or presentation. · Create clear oral messages. |
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D. Quantitative reasoning factors (25% ) show you can use mathematical information, operations and quantitative analyses to solve problems and inform decision making. · Identify numerical or mathematical information that is relevant in a problem or situation · Employ mathematical or statistical operations and data analysis techniques to arrive at a correct or optimal solution · Analyze mathematical or statistical information, or the results of quantitative inquiry and manipulation of data · Employ software applications and analytical tools to analyze, visualize and present data to inform decision-making
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E. Strategic Managment of financial capital factors (25%) show you can plan, evaluate, and manage the financial implications of the organization’s operations. · Apply relevant microeconomic principles to support strategic decisions for the organization. · Analyze financial statements to evaluate and optimize organizational performance · Determine optimal financial decisions in pursuit of an organiation’s goals · Develop operating forecasts and budgets and apply managerial accounting techniques to support strategic decisions. |
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Grade categories: A range (90 – 100%) B range (80 – 89%) C range (70 – 79%) F range (Below 70%) |
Overall Score: A + B + C+ D + E |
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Additional Comments:
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Tips for Designing Narrated PowerPoints
Marquis (2011) offers some useful guidelines: Creating an Engaging Presentation for the Online Classroom Aaron Weyenberg of TEDBlog (2014) offers some key tips, including:
1. The presentation needs to stand on its own, and strong visuals should support the words.
2. The slides should have a consistent look and feel. 3. Use transitions to support movement from topic to topic. 4. Avoid slides with a lot of text. 5. Use photos that are simple, yet strong, to illustrate the concept. 6. Go easy on the special effects.
Guy Kawasaki's 10-20-30 rule suggests: "A PowerPoint presentation should have 10 slides, last no more than 20 minutes, and contain no font smaller than 30 points." Yet, many hit presentations don't even come close to making that rule. So forget the hard and fast rules. It's about your presence, your topic and your audience.
Garr Reynolds (2014) further suggests:
1. Keep it simple (live or online) a. Use a horizontal or "landscape" orientation b. Slides should support the message, not be the message or star of the show – you are! c. Don’t let slides get unnecessarily complicated, busy, or full d. Nothing in your slide should be superfluous, ever e. Your slides should have plenty of "white space" or "negative space."
2. Limit bullet points and text a. Do not overuse bullets and text and crowd the screen b. Keep text brief
3. Use transitions and animations judiciously a. Some animation is a good thing, but stick to the most subtle and professional b. For transitions between slides, use no more than two or three different types of
transition effects and do not place transition effects between all slides 4. Use high-quality graphics 5. Use clear, crisp images 6. Be cautious of copyright issues 7. Never stretch low-resolution images 8. Avoid cartoonish clip art – use professional images 9. Select a visual theme
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10. If using PowerPoint design templates, keep to business or professional colors and themes
11. Use appropriate charts:
Pie charts are used to show percentages. Best to use no more than 4-6 slices. Use color or pull out the slice to contrast the most important slices.
Vertical bar charts are used to show changes in quantity over time. Limiting the number of bars to 4-8 is best.
Horizontal bar charts can be used to compare quantities such as the sale of cogs, chains, and sprockets in each of a company’s four regions.
Line charts are used to display a trend. For example, the trend in this chart is an overall increase in sales from January to July.
12. Use color well
Sales
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr
$0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Sales in Millions
0 5 10
Region 1
Region 2
Region 3
Region 4 Cogs
Chains
Sprockets
$0 $0 $0 $1 $1
Ja nu
ar y
Fe br
ua ry
M ar
ch
A pr
il
Ju ne Ju ly
M ill
io ns
Overall Sales
Overall Sales
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a. Colors can be divided into two general categories: cool (such as blue and green) and warm (such as orange and red)
b. Cool colors are often used in business presentations c. You can change the color scheme in a PowerPoint design template
13. Choose fonts well a. Use the same font set throughout your slide presentation b. Use no more than two complementary fonts (e.g., Arial and Arial Bold) c. Use sans-serif fonts (Arial, Calibri, Verdana)
d. Choose a size appropriate for the readers 14. Use audio and video appropriately
a. Use video clips to show concrete examples b. Avoid unusual sound effects c. Speak clearly in recordings
15. Use the Slide Sorter feature in PowerPoint to review the visual flow of your presentation
Microsoft PowerPoint. Used with permission from Microsoft.
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m62.net (2011) offers the following tips for recording:
1. Use a quality headset with a microphone – this keeps the microphone in a consistent position relative to your mouth and also minimizes echo and background noise to keep your voice levels steady.
2. Unplug your laptop charger before recording to avoid background humming sound while the microphone is on.
3. Perform several test runs to check sound quality 4. Prepare a script, but try not to sound like you’re reading from it as you record.
Strive to sound natural and be engaging. 5. Practice your timings and animation clicks before you start recording to avoid
uncomfortable pauses.
References Kawasaki, G. (2005). The 10/20/30 rule of PowerPoint. Retrieved from http://guykawasaki.com/the_102030_rule/ m62.net (September 20, 2011). Narrated presentations: Best practices. Article62 e-zine. Retrieved from http://www.m62.net/presentation-skills/e-presentation-skills/narrated- presentations-best-practices/ Marquis J. (2011, September 22). Creating an engaging presentation for the online classroom. Retrieved from http://www.onlineuniversities.com/blog/2011/09/creating-an- engaging-presentation-for-the-online-classroom/ Reynolds, G. (2014). Top ten slide tips. Retrieved from http://www.garrreynolds.com/preso-tips/design/ Weyenberg, A. (2015). 10 tips on how to make slides that communicate your idea, from TED’s in-house expert. TEDBlog. Retrieved from http://blog.ted.com/10-tips-for-better- slide-decks/
- Marquis (2011) offers some useful guidelines: Creating an Engaging Presentation for the Online Classroom
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How to Record Narration in PowerPoint
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With Microsoft PowerPoint 97 and above you can easily add voice narration to your presentation. In order to record narration, you’ll need a sound card, speakers/headphones and a microphone. Before you go ahead and start doing anything else you need to do some file management to better organize your project. Create a folder under your name and copy your PowerPoint Presentation in it.
Step 1: Removing Automatic Animation 1. Open your presentation. 2. Go to Slide Sorter view and check that there are NO automatic animations in your PowerPoint presentation:
a. On each slide, click on Slide Show, select Custom Animation b. You will see the Order & Timing tab with the animation order c. Click on each of the objects in the animation order and make sure that on the right hand side Start Animation is On Mouse Click and NOT Automatically.
Step 2: Settings 1. Select the slide in which you would like to begin narration. 2. In the Slide Show menu, choose Record Narration. This will open the 'Record Narration' dialog box.
How to Record Narration in PowerPoint
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Before you click 'OK', you might want to check out some options:
Set Microphone Level This is to ensure that your microphone is working properly. Click the Set Microphone Level button and you should be presented with a 'Microphone Check' dialog.
a. Make sure your speakers are on, and volume is up
b. Talk into the microphone, you should hear yourself in the speaker, and see green bars
Change Quality This option allows you to change the quality of the sound recorded. The best quality uses the maximum hard disk space as also system resources when running the presentation. The three preset options starting from the Best Quality are CD, Radio and Telephone.
a. Click on the button Change Quality… b. If this is your first time recording in PowerPoint, you can set up a shortcut for future times you open up PowerPoint to record:
i. Format: choose PCM ii. Attributes: choose 48.000 kHz, 16 Bit, Mono 93 kb/sec iii. Click on Save As and a box will popup asking for a name to save the format as: type a name and click on OK
How to Record Narration in PowerPoint
Page 3 of 4
Link Narrations – It is better to link your sound files rather than embedding. This option also allows you to later directly open the recorded sound files and edit them in a sound editor. Browse to the folder where you have your presentation in.
Step 3: Recording Narration a. Click on OK b. If you’re not on the first slide, PowerPoint will ask you if you want to start at the beginning, or the slide you are on. c. PowerPoint will now go to slide show viewer, and will start recording right away. Use the space bar, or the mouse to click through the slide show as you talk. You can record as many slides as you like. d. Press ESC to stop recording. PowerPoint will ask you if you wish to save the slide timings, click on NO. e. SAVE your work.
A sound icon will appear on the bottom right of every slide that you have recorded sound on.
Double click on each sound icon, and listen to yourself. If you’re not happy with it, rerecord until you are.
Step 4: Slide Timing Once you are satisfied with the sound on each slide, you can set up the slide timings
a. Check that, on EACH slide, the FIRST thing to be animated is the sound: i. Click on Slide Show and choose Custom Animation ii. In the animation box, make sure that the top object is your sound file. You can use the arrow buttons to put it at the top
b. Click on Slide Show and select Rehearse Timings i. It will take you to the first slide in slideshow viewer mode with a box on the top left of the screen. Click on the the right arrow in the box, or use the keyboard to advance through the slide in time with the narration.
ii. If you wish to redo a slide’s timing, click on the repeat arrow in the box.
How to Record Narration in PowerPoint
Page 4 of 4
Unfortunately, you cannot go back a slide and repeat the timing. Press ESC to get back to the slides if you wish to start over. When you get to the end of the presentation, it will ask you if you wish to save the slide timings, click Yes.
Step 5: Save Save your work. You are now ready to demonstrate your PowerPoint Presentation.
Delwar Sayeed, Center for Teaching and Learning
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Santa Rosa Jewelry
Target Profit Assignment
There are some hints in the notes page of each slide .
To get there, go to view tab, Notes page, you can see what is written in the notes sections, while the case facts and requirements are in the main PP slide area.
Tiffany Nadeau is your client!
Write a report that is appropriate for her (based on what you learn about her)
Make it a great week!
This assignment is not about working hard, but working smart. I do not expect you to consider every possible option nor for you to employ every tool we are providing you. Use what you need for this engagement, no more.
The goal always is to consider who your client is and to be cognizant of his/her business sophistication and her needs.
Read cases carefully. Write down the key input or facts of the case, write down what your assignment or goal is, and then re-read the case every day to make sure you are answering the question posed and providing an appropriate solution (not a bunch of possible sophisticated options) . Then support your recommendation as necessary and in a clear, concise, but complete way that your client will understand.
KIS (Keep it Simple)!
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Your assignment
- You agreed to analyze her business operations and to advise her how to reach her goal of earning $120,000 per year, after taxes. After some calculation and some thought, you conclude that Tiffany has to increase her revenues, perhaps by achieving greater volume, or perhaps by raising her selling price.
Jane just wants a reasonable outcome for her hard work.
You are given only two recommendations to consider: either increase volume OR Raise the selling price (Both to increase revenue!). NO MORE!!!
Work with the facts given and requirements your client set out for you.
KIS – Keep it Simple!
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Evaluate what kind of business
- Tiffany Nadeau established and ran a small workshop that manufactured unique, high quality jewelry. She marketed these creations to up scale gift shops across the United States in batches of 20 assorted items, for which she charged $2,880 per batch. In turn, the gift shops sold the jewelry at prices averaging eight times what they paid for the jewelry.
Evaluate what kind of business you are doing the analysis for. What do you think Tiffany’s likely competition is.?
What is her market? Is hers a mass production operation or a specialized niche market?
Can the market withstand a higher price for her “creations?”
She sells her jewelry by batch of 20 items in a batch. She does not sell partial batches, so discussion of 7.4 batches does not make sense. Also, as she sells by batch, it is not necessary to break costs out per piece of jewelry. (Although knowing the price per jewelry piece did help me to imagine a bit better the product being sold).
KIS and read the case carefully more than once!
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A bit about your client
Business was brisk, and Tiffany could sell all that she produced. But she found herself earning very little money, and after paying her 45% U S and California income tax, she found herself with almost no money to live on. That led Tiffany to you, as her consultant. She complained to you that she worked very hard, 50 weeks a year, but ended up broke and frustrated. Tiffany said that house prices were very expensive in Santa Rosa, CA and that she hoped to purchase a home and have enough left for a nice vacation and moderate lifestyle. She noted that she would be satisfied to make $120,000 a year, after taxes.
Think about your audience, the business savvy of your client, their needs, their personality. Can’t you picture Tiffany in your mind?
Tiffany really just wants to know what revenue she must have to have $120,000 after taxes by working 50 weeks per year, No more. She is optimistic that you, her MBA consultant can give her some good recommendation.
Your recommendations should reflect that you are “listening” to her needs and frustrations..
Tiffany does not have the patience to flip through your vast number of spreadsheets with lots of numbers on it, she is an artist. Keep it simple, but show how you get the numbers you come up with.
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Costs per unit: which unit?
- Tiffany employed 11 people. 10 earned $30 per hour and worked producing jewelry. Joseph was paid $20 per hour for his unskilled labor. Jewelry production varied between a low of 14 and a high of 26 batches per week, and averaged 1,000 batches per year. Each batch cost $130 (excluding wages) to pack and ship, with Joseph doing all the packing and shipping. It takes Joseph 1 hour to pack and ship one batch. Joseph also does other chores, such as sweeping, vacuuming and cleaning, and he averages 30 hours per week of employment with Tiffany's workshop, for the 50 weeks per year that he works for Tiffany.
Who does all of the “making” or “creating” ?
I appreciate your willingness to think of creative solutions, but be sensitive to your client.
KIS
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Contribution Income Statement
| Revenue | # units | X | sales price per unit | ||
| less variable costs | # units | X | Variable cost per unit | ||
| Contribution | # units | X | Contribution per unit | = | Total contribution |
| Fixed Costs | less total fixed costs | ||||
| Income before tax | Income before tax. | ||||
| Tax | Income X tax rate | ||||
| Income after tax | Income after tax (belongs to the owner) |
Your job is to determine which costs are fixed and which are variable per batch. Then find the target profit and determine the revenue required to reach target profit.
What is your recommendation?
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Tiffany’s marketing trips
- Tiffany spends 10 weeks a year touring the U.S. and attending trade shows in order to sell her jewelry. Her travel, hotel, show fees, and food costs were $4,200 each week. Workshop rent and utilities cost her an average of $7,500 per month. Tiffany works 40 weeks a year at making jewelry, While at the shop, she works 50 hours per week designing, setting up and manufacturing as needed to get orders out on time. She takes 2 weeks of vacation each year.
Are marketing and purchasing important functions? Are they important to Tiffany and to her sales?
Rent and utilities of $7,500 per month (included in the rent, utilities, and raw materials numbers given later in the case).
KIS and read the entire case more than once carefully! Keep in mind your client’s needs.
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Fixed and Variable manufacturing costs
- The cost of raw materials varied depending on the price of gold and silver. Tiffany spends about $1,900 per batch on raw materials. Production workers spend 20 hours form each batch. Tiffany’s time is in addition. They earn $30 per hour. And work 40 hours per week. Advertising runs $38,000 per year. Insurance costs $1,500 per month. Rent and Utilities are $7,500.
$7,500 per month (not per batch, ) for rent and utilities. Be sure to read carefully!
Oh, and KIS (Keep it simple)!
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Tiffany Nadeau established and ran a small workshop that manufactured original design quality jewelry. What began as a hobby for sale in craft shows grew into a small on-line business. Later, it became a manufacturer for upscale jewelry shops in tourist locations across the country. To accommodate the greater volume, Ms. Nadeau opened a small workshop in the historic district of Santa Rosa, California, about 50 miles north of San Francisco. She paid the following prices for some of her raw material: Gold $1,200 per ounce, Silver $16.50 per ounce. Gold and Silver prices have been volatile making pricing difficult.
She marketed these creations to gift shops across the United States in batches of 20 assorted items, for which she charged $2,880 per batch. In turn, the gift shop sold the jewelry at prices averaging eight times what they paid for the jewelry.
Tiffany had a staff of 11. Ten workers produced the jewelry and Joseph helped with shipping and cleanup. The production people were paid $30 per hour including benefits and Joseph was paid $20 per hour for his unskilled labor. Jewelry production varied between a low of 14 and a high of 26 batches per week, and averaged 1,000 batches per year. Each batch cost $130 (excluding wages) to pack, ship and insure, with Joseph doing all the packing and shipping. It takes Joe 1 hour to pack and ship one batch. Joe also does other chores, such as sweeping, vacuuming and cleaning, and he averages 30 hours per week of employment with Tiffany's workshop, for the 50 weeks per year that he works for Tiffany (with his time split between packing and shipping of batches and doing weekly cleaning, etc.)
Tiffany spends 10 weeks a year touring the U.S. She attends trade shows in order to sell her jewelry, and to find suppliers of the components for her products. Her travel, hotel, show fees, and food costs were $4,200 each week. Workshop rent and utilities cost her an average of $7,500 per month. Insurance including liability, workers compensation, and unemployment cost $1,500 per month. Advertising in trade journals and on Fashionista.com cost $38,000 per year.
Tiffany works 40 weeks a year at making jewelry, often working over 50 hours per week. She spends 10 weeks marketing and takes 2 weeks of vacation.
The cost of raw materials averaged $1,900 per batch. It takes Maria and Juanita 20 hours per batch to manufacture the jewelry. Tiffany does design work, creates the molds for the jewelry and spends time making the items as needed to meet orders.
Business was brisk, and Tiffany could easily sell every batch that she produced. But she found herself earning very little money, and after paying her 45% income tax for US and California, she found herself with almost no money to live on. That led her to ask for your help.
She complained to you that she worked very hard, 50 weeks a year, but ended up broke and frustrated. Tiffany said that Santa Rosa was expensive even though home prices were less than half of what they were in San Francisco, some 50 miles to the south. Reasonable homes sold for $500,000 to $2,000,000. These were about 4 times the price of homes in Croydon, New Hampshire where her sister lived. With property taxes and insurance, Tiffany thought that she needed at least $5,400 per month for her mortgage payment. That payment was far beyond what she can afford. She would need $10,000 per month after tax to afford the mortgage and have enough left for a moderate lifestyle.
You agreed to analyze her business operations and to advise her how to reach her goal of earning $120,000 per year, after taxes.
After some calculation and some thought, you conclude that Tiffany has to increase her revenues, perhaps by achieving greater volume, or perhaps by raising her selling price. Write a short report directed
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