The Marketing Mix Essay - 275 Words

The Marketing Mix (Essay Sample) Content: The Marketing Mix-PriceName:Institution:The Marketing Mix-PriceCreating product prices is a difficult choice for a company. Available alternatives include offering the product free of charge, pricing based on input costs plus a profit margin, or premium pricing based on consumers propensity to spend. The model a company chooses will depend on its brand image, available capital, or its growth prospects (Narayandas, 2005). Therefore, the chosen model should reflect how a company implements its business strategy to attain financial objectives. The model will take into consideration characteristics of the market and consumers, models of competitors, and goals of the company with respect to the volume it wants to drive in the long-term.Pricing ModelsCanned VegetablesThe most appropriate pricing model for canned vegetables is a cost-based model. This model uses the unit cost of production, which includes direct and indirect costs when setting price. The company will add a p rofit margin that is a percentage of the total cost of production to the final price (Narayandas, 2005). Characteristics of cost-based pricing include:It is easy to adjust price when costs increase.It is ideal for those products that have a specified quantity of raw materials. It suits manufacturer who can scale production relative to the products demand. It does not consider competitor pricing models, as long as it covers unit costs.It ignores the effect of pricing on the product demand. It does not give an incentive to improve efficiency.Companies that produce canned vegetables incorporate various ingredients to make the food nutritious. When pricing, first they will add the cost of inputs then include a profit margin to come up with the final price. This means that many companies within the same industry may have different prices for the same product if the cost of inputs is different (Agriculture, Food and Rural Development, 1999). Aspirin Aspirin is a drug people consume when they are sick and the most appropriate model is value based pricing. Its manufacturers use different ingredients in varying combinations during production. Therefore, they will set a price depending on the value consumers attach to the product (Anand, Khanna, 2000). The company does not rely on prices of competitors since people will consume this drug based on its effectiveness to cure maladies. The demand for the product is pegged on the number of sick people meaning that if the company were to add more ingredients to the drug to make it more useful and charge more, people would still buy it. Gale and Swire (2006) say that the characteristics of value based pricing include the following:Has ability to maximize revenue given that the model is based on how much customers are willing to pay for the value they will pull from the product.It focuses the product on customer expectations. It ignores pricing of competitors.It is suitable where a company can grade its brand value relative to competitor brands. It does not rely on cost of production.A company using value-based pricing will charge customers based on the perceived value of the product. The company will produce similar categories of product with different ingredients and charge each group a different price (PWC, 2014). Similarities between Cost-Based and Value-Based ModelsHinterhuber (2004) says that both methods use other attributes besides product demand when setting price. Cost based model uses unit cost of production while value based model uses the perceived value to determine the price.Both models focus on a profit margin though cost based model has a lower margin than value based model. This is because the cost-based model considers the market floor and ceiling when determining the right price while value based method looks at how much clients are willing to pay for its product. Both methods allow the company to cluster clients and charge them differently depending on what they consume. This is be cause the price depends on the cost of production or the intrinsic value of the productDifferencesSimon and Butscher (2001) give the differences in the two models as follows:Focus: Cost-based pricing looks at how much profit the company wants to make while value based pricing takes into consideration the value clients will get after consuming the product. Price: With cost-based pricing, market conditions determine the price a company will charge for its products while in value based model, the company looks at consumers ability to pay for the product. Benefits: Cost-based pricing transfer benefits to consume...

The Civil War

My Strengths And Weaknesses Of Writing - 823 Words

It is important that students are aware of writing errors such as grammar, spelling, punctuation and avoid plagiarism. Masters level writing is different than other forms of writing and students must be able to address to an academic audience. APA formatting is also necessary for all assignments whether writing papers or submitting power point presentations. I will provide a summary of all feedback received from my instructor in Weeks one, two, and four from my individual assignments. I will present my strengths and weaknesses in writing and provide a detailed plan for refining areas where improvements need for improvement. Summary for Weeks One, Two, and Four Individual Assignments. Comments on the content of my papers were active. The feedback received for week one stated that I demonstrated an understanding of the topic and provided theories from my personal experience. I provided the majority of requirements needed for credit. Although I discussed the important characteristics in my paper, failed to compare other forms of writing of graduate students. I got good feedback in time management, plagiarism, best practices for stress, and elements of effective writing. Comments on the organization of my paper were positive. The instructor stated that I did well with my introduction and conclusion. My article was logical, and held together a common thread and met the length requirement. Points got deducted for not addressing to an academic audience. Comments for Spelling,Show MoreRelatedMy Strengths And Weaknesses Of Writing926 Words   |  4 Pageschild with no skill in writing what-so-ever. I could not format a sentence, let alone a paper, to save my life. Writin g was a whole new world, both frightening and exciting. There were so many possibilities I had yet to see and a great many things I had to learn. My strengths and weaknesses in writing have changed drastically since I began my high school English classes. In regards to the analysis essay assigned to my class regarding John Steinbeck’s â€Å"The Pearl,† my strengths contributed highly toRead MoreMy Strengths And Weaknesses Of My Writing977 Words   |  4 Pageslearned—meaning I will work to carry about my strengths and eliminate my remaining weaknesses. English 101 has helped me grow as a reader, a writer, and most importantly a person. My writing has progressed during the term by becoming more specific and sophisticated on an analytic level. I have learned to closely observe what I am reading or researching; this helping to improve the credibility in my writing. When the grades were passed back for the first minor writing, I was highly dissatisfied with theRead MoreWhat Are The Strengths And Weaknesses Of My Writing1370 Words   |  6 PagesConsidering my essay and rubric there are some strengths and weaknesses. In my essay, i felt like the setting of my story was good as well as the body of the essay. What i mean by this is by my choice of words, variety of verbs, format, and how easy it is to read. The overall quality of my writing in my opinion was the best part. I feel like the details I used really gave my paper character. Details such as how I used to write on a lot of the things I owned, how in the sixth and seventh grade I wroteRead MoreStrengths and Weaknesses Essay844 Words   |  4 PagesStrengths and Weaknesses Throughout the Mid-SEE I have written reflections on my writing and participated in group activities. I have received comments back from my peers and suggestions to help with revising my paper. With the help of my professor, Professor Church and my classmates, I was able to comprehend their suggestions to me to make my essay better and by revising my classmate’s essays, I was able to point out mistakes that I might have made in my essay, which made myself go back to myRead MoreFootball Reflection Paper773 Words   |  4 Pagesfootball player. I started 2 seasons ago, and am on my third. As with anything, I have strengths and weaknesses when playing football. But I have to work with these if I want to be a good football player. My experience with football also can relate to ELA and my strengths and weaknesses there. I started football because I felt I would be good at it. I was good in some aspects, but some I was bad in. An aspect I was good in was my physical strength. I go to a weight room in Marlboro called H.I.T. trainingRead MoreStrengths And Weaknesses Of Reading Essay958 Words   |  4 PagesMy Path A persons strength was always his weakness. When it comes to reading and writing, I have many strengths and weaknesses. My past writing and reading experiences have made me into the writer/reader that I today. Strengths help me excel in my read/write, but the weaknesses do bring me in a stump at times. When writing an essay, you can have a very high vocabulary, but not have the best of grammar. The good thing about weaknesses is that they can be worked on to be made into a strength. ManyRead MoreEntering The Class, English Comp914 Words   |  4 PagesGarth had told us, that I was going to have many weaknesses while writing my papers, but I would also have many strengths from what I had learned in the past about writing. In August, our first day in the college class, Mrs. Garth talked with the class about what this semester was going to be like. She spoke to us as college students and not little children. She told us that Comp. was all about writing. As a class, we knew there would be more writing than we were use to, but the very first paper thatRead MoreGraduation Speech On The State Exams1460 Words   |  6 PagesThroughout the 15 years of my academic career, academic writing has become a much larger part of the curriculum. The writing assignments have gone from simple, one- line sentences describing a picture to a simple, 3- paragraph persuasive essay on the state exams in high school; all the way to a 25 page comprehensive research essay during my freshman year at East Stroudsburg University. As the years and assignments progressed, I developed a set of writing weakness and strengths that still shape the wayRead MoreMy Strengths and Weaknesses806 Words   |  4 PagesMy Strengths and weakness es Everyone has must have some strengths and weaknesses. Some people know how to handle their weaknesses in the right way. Others keep hiding their own weaknesses and they do not want any help. I am one of the person whom has been keeping my weaknesses inside and hiding all the time. I realized that I need to change by getting help and overcome my fear because my weakness has been bothering me and keeping me away from my success. The strengths are the talents and the hobbiesRead MoreMy Strengths And Weaknesses Of An Effective Student988 Words   |  4 Pagesand use their current strengths and weaknesses to create a game plan that will help them be an effective student. Personally, I think this is a great tool because it helped me identify what my strengths are. Since I identified more strengths than weaknesses I saw this self-assessment as a motivation tool. In this lesson, I learned that there can be patterns to your strengths and your weaknesses (Bethel University, 2014). This ess ay will go over what my strengths and weaknesses were, after taking

Organizational Structure Of An Effective Organization

In today s complex organizations, there are different factors that influence their effectiveness. These factors include processes, capabilities and structure that help to accomplish the organization s vision, mission and goals, which must all work aligned to accomplish excellence. An effective organization must have balance and strength in different areas. In the following research paper, we will discuss those areas in detail. These areas include the organization structure of an effective organization, the best the communication strategies to send the different messages across the company, the effective process for decision-making and problem-solving. Additionally, we will explore the process for effective management as well as a valid approach of leadership that contribute to achieve excellence in our current complex organization environments. Components of an Effective Organizational Structure The organizational structure in a company has a highly impact in a large number of organizational activities and behaviors. The term organizational structure is described as the manner in which daily tasks and activities are formally separated, classified and coordinated within a company (Islam, Jasimuddin Hasan, 2015). The design of organizational structure regularly defines the way a company can adapt to changes in internal and external environments and, as a consequence, the design of an organizational structure influences greatly to the competitiveness and effectiveness ofShow MoreRelatedDeveloping Effective Teamwork in Organizations by Considering the Organizational Structure, Culture, Employees’ Motivational and Leadership Aspects.9709 Words   |  39 PagesDeveloping effective teamwork in organizations by considering the organizational structure, culture, employees’ Motivational and leadership aspects. LEARNING OUTCOME 1 TASK 1a AN ORGANISATIONAL STRUCTURE There are many different opinions and definitions of organizational structure. Structure in a sense is the arrangement of the functions used to do the work. Thompson said the structure is the inner structure of the differentiation and the relations. He referred to the structure as the meansRead MorePfizer Case Study1484 Words   |  6 Pageslargest research-based pharmaceuticals firm and also a well known Pharmaceutical company. So their most of the work depends on research, developing Strategies and innovate. They were trying to find a new way of system which makes their Work more effective and efficient. Pfizer find out that their worker spends more time on Business research and data analysis to the creation of documents and other routine Support like Goggling and making power points and also spending so much time on Menial tasksRead MoreThe School Of Public And Environmental Affairs1568 Words   |  7 Pagescontinuous occurrence throughout the growth of organizations and the ir success can be correlated with how adaptable the organization is to these changes. SPEA’s current organizational structure is not working effectively, so in order to remedy this problem, we must change the organizational structure within SPEA. I have created a plan that will solve the communication problems within SPEA while simultaneously enhancing the structure and culture of the organization. The School of Public and EnvironmentalRead MoreOrganizational Structure Essay1147 Words   |  5 Pages From: Jessica Rushing Subject: â€Å"Organizational Structure† Introduction: Organizational structure provides the framework of an organization determining how roles and responsibilities are delegated throughout the different levels of the organization. It has been defined by some as the looking glass through which coworkers see their organization and its surrounding environment while others have described structure as the backbone of the organization. In this memo, I will briefly discussRead MoreThe Human Relations Movement Within The Organization, Management, And Organizational Culture832 Words   |  4 Pagesenvironment , an effective organization must focus on several areas while encompassing strong ethics and organizational culture. The areas of importance are described as: organizational structure, communication within the organization, management style, the organization’s decision-making and problem solving strategies and strong leadership approach. Organizational Structure To thoroughly examine and discuss the elements of organizational structure, we must consider history. Today’s organizational theoriesRead MoreComparison of Different Organizational Structures1425 Words   |  6 PagesOrganizational structure For any organization to be effective there has to be an effective organizational structure in place. An organizational structure is therefore a typically hierarchical arrangement of lines of authority, communications, rights and duties of an organization. In other words it is a form of structure that determines the hierarchy and reporting structure in the organization. In lay mans language it is referred to as organizational chart. An organizational structure that isRead MoreCreativity And Innovation Is The Driving Forces Of Organizational Success1495 Words   |  6 Pagesforces of organizational success (Nadler Tushman 1997). To achieve constant innovation creativity, leaders must actively implement strategies and establish an environment that encourages it (Nadler Tushman 1997). Hence, leadership is known as the catalyst and source of organizational creativity and innovation (Nadler Tushman 1997). Innovation and creativity also depend on the leader’s ability to manage diversity in the organization as well as to develop an effective leadership structure that sustainsRead MoreOrganizational Structures And Organizational Cultures For Different Organizations Essay1277 Words   |  6 PagesExecutive Summary The first task of the report of assignment ‘Organization and Behaviour’ deals with the comparison of various different kinds of organizational structures and organizational cultures for different organizations. In addition, the task takes into account the impact of the culture and the structure of organization on the functions and operation of business. However, the various factors which influence the individual performance and behaviour at work is also given emphasis in this partRead MoreOrganizational Structure And Functional Structure839 Words   |  4 Pagescreated their organizational structure? How is the organizational structure reflected in the company culture? The company I have chosen is the Department of Navy created their Functional Structure which was based of learned lessons from past military employment history. The Navy’s functional structure provides organization according to a jobs or an individual’s purpose within the organization. Departments that focus on a single function or goal most easily recognize functional organizations. For instanceRead MorePfizer Case Study1500 Words   |  6 Pageslargest research-based pharmaceuticals firm and also a well known Pharmaceutical company. So their most of the work depends on research, developing Strategies and innovate. They were trying to find a new way of system which makes their Work more effective and efficient. Pfizer find out that their worker spends more time on Business research and data analysis to the creation of documents and other routine Support like Goggling and making power points and also spending so much time on Menial tasks

Cell Phone As The Main Tool Of Communication - 1040 Words

With the development of society, people get close increasingly. Mobile phone as the main tool of communication comes into people s daily life. With the development of science and technology, cell phones provide people an easy, and fast way of communication. The cell phone is easy carry, and it helps people keep in touch with others. This is a reason why most people choose the cell phone as their main tool of communication. People rely on their phones. Cell phone has almost become an indispensable part of life. Mobile phones help people contact others, share happiness, and sorrow in their lives. The cell phone has become the main way to communicate with people, and express their feelings. When people glance around a public place, they can easy to find that people always busy looking down. Sending a message, receive an e-mail, making a phone call, or watching a video these things will all be done by using a cell phone. Some people like surfing the internet by their phone, they even pla y on their phone all night. Dependent on a cell phone is not a good way to get along with other people. Too much cell phone use can lead the change of personal characteristics. People will become unsocial, and lonely. Friends will not even know the person they talk to. The family relationship will not developed by phone use. It is good that message technology has given people a career, but it is also ruining the entire world. People use technological communication more than face-to-face.Show MoreRelatedNegatives Of Images Of The Photo972 Words   |  4 Pagesstanding next to each other. Each of them have a cell phone in their hand and seem to be intoxicated by what their phones are displaying. In the background of the image is an older, cemented, light brown, rock wall in which the young adults are leaning against. There is no visible interaction between the four people in the image. These phones may have increased online social interaction; however, this photo can be used as pro of to argue that phones have become a distraction and hindered personalRead MoreMobile Phone Is a Learning Tool1022 Words   |  5 Pages Topic: Mobile phones are a necessary tool for education. Discuss Mobile phones are the communication device that can connect people with others in any places. Students nowadays rely on mobile phones as their communication devices with friends and parents. Some of them think mobile phones as a learning tool. Are they really essential as a learning tool? This essay will argue that mobile phones are a necessary tool for education but also they are not necessary tool for education. Firstly, itRead MoreImages And Its Impact On Society947 Words   |  4 Pagesalongside each other in the foreground. Each of them has a cell phone in their hand, peering straight at their phone. The background of this image is an older cemented light brown rock wall in which these young adults lean against. There is no interaction between these four people in the image. These phones may have increased online social interaction, nonetheless also becoming a distraction. They have greatly diminished person-to-person communication, consequently causing the younger genera tion to putRead MoreCell Phone Use in Schools1094 Words   |  5 Pagesï » ¿Cell Phone Use in Schools The use of cell phones in school is a controversial subject. There is a definite defining line between administration on one side and students on the other. The amazing thing about cell phones is that they are no longer just used for calling or texting. They have become an essential multi-tool wonder. Today’s cell phone is cutting-edge technology at your fingertips. While students do understand the apprehension of faculty to allow cells phone use school, we too have reasonsRead MoreSonic Marketing Plan And Exercises916 Words   |  4 Pages A newly start-up company called Sonic is preparing to introduce a new model of mobile phone in the main market competing with the main leaders like Apple, Samsung and others. Sonic is very proud of their smart phone named the Sonic 1000, which is the product to compete with others in the market. The cell phone market is very competitive for changeable trends and combines entertainment with the communication goals. Therefore, the compan y must prepare themselves to fight in this tough market byRead MoreEssay on Revolutionized Communication: The Cell Phone1612 Words   |  7 PagesRevolutionized Communication: The Cell Phone The emerging technologies of the century have greatly affected how people interact personally and professionally. From 1990 to 2010, mobile phone users grew from 12 million to over 4 billion worldwide; in fact, almost 90 percent of households in America have a mobile phone (Wortham). The creation of the mobile phone marked a new era for America and the world. Phones have evolved from the â€Å"bag phone† to the BlackBerry, and will forever change the way aRead MoreThe Effects Of Cell Phones On Children s Declining Interpersonal Skills Essay889 Words   |  4 PagesAnother negative effect caused by cell phones is people’s declining interpersonal skills. In Is Social Media Destroying Teen’s Interpersonal Skills? Experts Say It May, Sekinah Brodie pointed out that though the widespread of cell phones increases the quantity of interpersonal communication, the increase is at the sacrifice of quality. As it is widely acknowledged, interpersonal communication plays a v ital role throughout one’s life, both in relationships and career, consisting of written, verbalRead MoreFor The Last Couple Of Decades, The Evolution Of Cell Phones1389 Words   |  6 Pagesevolution of cell phones has happened fast, and it has happened right before our eyes. The memories about having a house phone with a cord on a table or attached to the wall are still on my mind. Nowadays, however, a person needs only one device to do different things at the same time, when in the past one needed three different devices to be able to do their things, and it was time-consuming. Not everybody has adapted to the new era of cell phones. There are still people who think cell phones are moreRead MoreLiterature Review : Cell Phone And The Invention Of Cellular Phone1221 Words   |  5 Pagesthe 20th century, the development of technologies is unprecedented, and the invention of cellular phone must be the most important. Literally speaking, cellular phone totally changed the way we communicate and live nowadays. However, the biggest promotion between phone and smart phone must be application. With the various kinds of application’s launch, cell phone is no longer just as the communicate tools for people, it plays so many roles in our daily life, and because of teenagers’ curiosity, likeRead MoreCell phones How have they changed us socially?1632 Words   |  7 PagesDoes cell phone use really affect our communication skills? Cartoon by Izzy Peterson by Erin Stewart, Editor November 25, 2013 Filed under Fall 2013, Story Cycle 4, Features, Opinion, Showcase The short URL of the present article is: http://lhslance.org/bKUbA We live in a world where communication through modern technology is almost required. Everywhere people are texting, emailing, writing blogs and tweeting. It’s hard to go anywhere without seeing someone using a phone or the Internet

The ASIC Key

Question: Write an essay on The ASIC key. Answer: To register a company, the person who planned for such registration needs to apply to the ASIC. The ASIC key is an important aspect in the formation of the business. The ASIC key is one unique number that is used in the ASIC Connect, helping the new registers of the business to protect their business information (Rahman 2013). The key makes and gives the assurance to the new business holders that only they will have an access to the business information, and also only other authorized person or members can get the access to the business. The ASIC mentioned under the section 117 of the corporation act. The primary step is to register concerning the section. The following step that comes after the registration then the type of company has to be determined as mentioned under the section 112 of the act. Here, we will form a Company of Proprietary Limited (asic.gov.au 2016). Company type: Proprietary Limited Company (as mentioned under Sec 112 of the Act). The type of the company is ten referred with the sec 601W of the corporation act: The mentioned section applies for the registered body subjecting to the subclause (2). If the registrable body is same as the Australian registrable body, then the mentioned section do not apply concerning the place of the business carried out but is done concerning the origin of the business or the place of origin. Next under the clause nine under the section, this defines that other than the ADI body of Australia, it is the duty of the company to affix the name in the painted form. The company also must paint the name in such manner which is visible clearly, and the name must be put in front of all the business premises and also in front of the registered office. So, The name of the corporating body must be clear along with the place of the origin which is also compulsory for the display in front. If the company is the holder of the limited or the Proprietary company, then it is mandatory for the members to use such suffix in the name or even at least the abbreviation like the Ltd or Pty respectively. The mention of section 112 of the Act is mandatory for understanding the type of company and also the liability they hold under any pattern of the corporation (Human et al. 2015). Next step is the vital step for the propitiatory business set up. In this context, the reference from section 117(2) of the Act is mandatory. The primary step in the registration includes that the company must indicate the liability of every member in the within the name of the business setup: As, for this situation to set up a proprietary limited company, the suffix usage is an essential step included while the registration done. Choosing a name of the company in such a way so that it is not registered with the same name in any ongoing business: The name one chooses for the corporation must be such that it has a chance to get approved from ASIC since sometimes the ASIC rejects the approval when found that the name has some similarity with some ongoing business firm. The ASIC will also reject the registration if they find that the suggested name is offensive or carries the illegal motive. Upon such situations, the there are some suggestive moves from the ASIC to bring necessary amendments. There is an alternative procedure available to name the company using the ACN or ABN, which means the Australia Company Number or the Australian Business Numbers respectively (australia.gov.au 2016). While the name choosing of the corporation gets over, then the next step that comes is the valid consent from the members. Under the act of the corporation, the valid consent from the members of the company is an important step during the time of registration. The following members are liable to produce their valid consent: The director(s) of the company expected to be a person of more than 18 years of age. Secretary of the company, who, like the director of the company is also expected to be a member with age of more than 18 years. Member(s) of the company, like the other members, must have attained the age of minimum 18 years old. It is important to note that under the propitiatory form of the company it is not mandatory to have a post of secretary; the presence of the directors must have at least one with the holder of Australian Citizenship. After attaining the consent from the members of the acting corporation, then follows the step of registration of the corporation, where certain procedures are followed: Details of the applicant: His name: Name of Company: His designation: Address (personal as well as official): Telephone (residential, official as well as availability after the office hours): Facsimile: All details for the proposed company: Suggestive names of the company(sequence must follow the preference concern): Suffix name: State of incorporation: Address of the registered office: Address of the business: Acting Superannuation Trustee: Seal(whether needed or not): Presentation of the company: Kit from Bank: Name to be verified whether existing or violating any norms: Defining role of the applicant(whether to work as registered agent or with regards to the ASIC requirement): Shareholder: Type of shareholder: Name: ABN or ACN: Address: Personal details: Professional details comprising of: Position in company: Numeric value of the shares: Form of Share (trustee or beneficially owned) Advise on further issuing of the shares: The mentioned pattern will follow for all the business shareholders in the company by the number of shareholder 1 and so on. Apart from that, the registration form will comprise of: Additional notes: Fees: $738 GST. Mode of payment: Lastly, accepting the terms and conditions to fulfil the registration. The company needs to set up a constitution as under section 134, which includes the governing procedures and also the pattern of the internal management (legislation.gov.au 2016). The constitution comprises the rules mentioned under the replaceable rules concerning sec 135 of the Act. Although the proprietary business does not need to do not need to set up the constitution, it is advisable for the entire registered corporation to set up a corporation so that it is easy to keep the company record. The clause also includes the necessity of the company preference for issuing the shares, special resolution approval which includes the repayment of the capital, profit participation, and the surplus assets, voting rights and cumulative dividends. Constitutions are mainly based on the redeemable share preference at the time of such occurrence of the events or with the option of the shareholders (Anderson et al. 2015). The formation of the legislative act comes with the necessity of the occurrence so that there are some specified that can be followed while any procedures carried out. In the corporation law, the act so mentioned explains about the liability or the power. Some sections are amended due to the controversy. The explanation can be carried further: Section 124: this section defines about the legal capacity of any corporating head with the vested powers to carry on with some activities. The section got a critical role in the formation of the business (Bakan 2012). It is paramount for the members acting since they got the power to issue shares or cancel shares or even issue the debentures. Some situation requires the company to grant some opinion for security interest option. The legal authority provides the company to act in concern with the situation, provided that it is mandatory that they maintain the good faith and belief within the acting members (abr.gov.au 2016). Sec 129(1): the constitution of the company along with the replaceable rules are compiled together since it is mandatory for the company to maintain a constitution even though that is not mandatory as in the case of the proprietary form of business. The combining of the replaceable rules with the actual constitutions helps the corporation to make essential changes or amendments during the time of absolute necessity (austlii.edu.au 2016). Section 588(M) (3): the clause arises some necessity to the act after the introduction of this section. Here there is an explanation of the creditor who is not liable to get the damage in means of compensation from the directors of the company. The creditors are also known as the investors of the company; hence, they are liable to get the compensation to the loss occurred to them due to the insolvency of the company as mentioned under the subdivision B concerning the section of the act, and the amount is equal to the amount of loss occurred (Dobson 2014). Also, the liquidator of the company is also liable for the compensation provided that the director has been proved for his insolvency (Wright 2014). So, all the three sections mentioned here hold an important part in the carrying out of the business. References: Abr.gov.au. 2016. For Business, Super funds Charities | Australian Business Register. [online] Available at: https://abr.gov.au/For-Business,-Super-funds---Charities/ [Accessed 23 May 2016]. Anderson, C., Howell, N. and Mason, R.F., 2015. Submission to the Productivity Commission issues paper business set-Up, transfer and closure. Asic.gov.au. 2016. Lodging paper forms | ASIC - Australian Securities and Investments Commission. [online] Available at: https://asic.gov.au/online-services/lodging-paper-forms/ [Accessed 23 May 2016]. Austlii.edu.au. 2016. CORPORATIONS ACT 2001 - SECT 129Assumptions that can be made under section 128. [online] Available at: https://www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s129.html [Accessed 23 May 2016]. Austlii.edu.au. 2016. CORPORATIONS ACT 2001 - SECT 588MRecovery of compensation for loss resulting from insolvent trading. [online] Available at: https://www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s588m.html [Accessed 23 May 2016]. Australia.gov.au. 2016. ABN, ACN, business management | australia.gov.au. [online] Available at: https://www.australia.gov.au/information-and-services/business-and-industry/abn-acn-business-management [Accessed 23 May 2016]. Bakan, J., 2012.The corporation: The pathological pursuit of profit and power. Hachette UK. Dobson, R., 2014. Liquidation Winding up a company.Busidate,22(4), p.5. Human, S.E., Clark, T., Baucus, M.S. and Eustis, A.C.S., 2015. Idea or Prime Opportunity? A Framework for Evaluating Business Ideas for New and Small Ventures.Journal of Small Business Strategy,15(1), pp.59-80. Legislation.gov.au. 2016. Corporations Act 2001. [online] Available at: https://www.legislation.gov.au/Details/C2014C00519 [Accessed 23 May 2016]. Rahman, A.R., 2013.The Australian Accounting Standards Review Board (RLE Accounting): The Establishment of Its Participative Review Process. Routledge. Wright, C.J., 2014.A critical enquiry into the need for avoidance provisions in business rescue proceedings.

Financial Management Principles Cash Balance

Question: Describe about the Financial Management Principles for Cash Balance. Answer: 1:- From the case study and financial statements, it can be stated that Jackson Limited has managed to generate profits for the last eight months. However, the company could not repay the loan on time. There are several issues, for which the company has requested to extend the term loan period. From the monthly income statement for the last eight months, it has been observed that the company could not maintain the net profit margin stable. It has decreased significantly over the period. Such fall in profit margin has been caused due to fall in sales for the last three month. From March2013 to May,2013, the actual sales figures were lesser than the budgeted sales (Channon and Jalland 2016). The fall in sales volume, as reported by the company, has happened due to the delay in the shipments. It could not complete the orders on time as some vital components arrived very lately. Therefore, the company could not generate the anticipated sales volume and accumulate enough cash balance. Moreover, it has also suffered from inadequate cash balance due to dividend payment on March2013 (Kaplan and Atkinson 2015). Hence, it can be concluded from the above discussions, that though the company has earned profit over the due period, it has failed to generate the budgeted sales volume due to operational hazards. It has caused a temporary shortfall in cash balance, for which the company could not repay the loan timely. The main sources and uses of funds for Jackson Limited is described in the following table:- Particulars Details Sources of Funds Sales Operation Loan from Bank Interest on cash Balance Uses of Funds Purchase of Raw Material Operating Expenses Tax Payment Interest on Loan Dividend Payment 2:- The company requires the new loan of $2.4 million to purchase new equipment for operational purpose. As the president of the company had mentioned, the company had not bought any new equipment for the last few year due to recession. Moreover, some of the components of the older equipments have worn out, which may cause interruption in production. The company has always focused on innovative designs to satisfy its customers. It has been one of the key strengths of the company, which has helped it to survive in the recession period successfully (Bryson 2012). In such scenario, if the company does not upgrade its machinery and equipments accordingly, it cannot maintain its goodwill in the market. Moreover, as mentioned earlier, due to poor conditions of the equipment, it may face disruptions in operation (Rausand 2013). In the current financial year, it has already suffered such disruption due to delay in shipments, which has caused fall in sales volumes. Now, if it again faces such problems, then it will be unable to recoup the losses. The quality of the end products may also hamper for the poor condition of the equipment and lead to customer dissatisfaction. Therefore, it can be suggested that the requirement of the additional borrowing can be considered as urgent. 3:- Cash Budget:- Partculars June'13 July'13 August'13 September'13 Cash Flow from Operating Activities Payment from Customers 3,744 12,681 7,374 4,501 Payment to Suppliers (5,969) (5,200) (5,200) (5,200) Payment for Operating Expenses (1,838) (1,838) (1,838) (1,838) Income Tax Payment (375) (375) Net Cash Inflow/(Outflow) from Operating Activities -4438 5643 336 -2912 Cash Flow from Investing Activities Purchase of New Equipment -2400 Net Cash Inflow/(Outflow) from Operating Activities 0 -2400 0 0 Cash Flow from Financing Activities Loan from bank 2400 Interest on Loan -25 -25 -37 -37 Interest Income 8 1 10 11 Repayment of Loan -7400 Dividend Paid -1200 Net Cash Inflow/(Outflow) from Operating Activities -17 2376 -27 -8626 Total Cash Inflow/(Outflow) -4455 5619 309 -11538 Add: Opening Cash Balance 4,994 539 6,158 6,468 Closing Cash Balance 539 6,158 6,468 (5,071) Income Statement:- Particulars June'13 July'13 Aug '13 Sep'13 TOTAL Net Sales 12,681 7,374 7,201 7,394 34,650 Less: COGS 9,765 5,381 5,381 5,381 25,909 Gross Profit 2,916 1,993 1,820 2,013 8,741 Operating expenses 750 750 750 750 3,000 Depreciation and amortization 120 120 130 130 500 Interest expense 25 25 37 37 124 Interest income 8 1 10 11 30 Profit (loss) before tax 2,013 1,097 892 1,085 5,086 Income taxes 684 373 303 369 1,729 Net income 1,328 724 589 716 3,357 Dividends 1200 1,200 Balance Sheet:- June'13 July'13 Aug'13 Sep'13 Cash 539 6,158 6,468 Accounts receivable 12,681 7,374 7,201 7,394 Inventory 7,317 7,728 5,541 8,822 Current assets 20,537 21,260 19,209 16,216 Gross PPE 45,500 47,900 47,900 47,900 Accumulated depreciation 30,488 30,608 30,738 30,868 Net PPE 15,012 17,292 17,162 17,032 Tax Refundable 6 Prepaid expenses 54 54 54 54 Total assets 35,603 38,606 36,425 33,308 Accounts payable 5,200 5,200 5,200 5,200 Bank Overdraft 5,071 Notes payable, bank 5,000 7,400 7,400 Accrued taxes 309 373 303 Other accrued expenses 1,142 1,142 1,142 1,142 Customer advance payments 2,700 2,700 0 0 Current liabilities 14,351 16,815 14,045 11,413 Shareholders' equity 21,251 21,791 22,380 21,896 Total liabilities and equity 35,603 38,606 36,425 33,308 4:- The projected income statement for the period from June,2013 to September,2013 exhibits quite satisfactory outcomes. The company is expected to earn high amount of profit in this period. However, from the cash budget for the same period, it can be stated that the company will not be able to repay the loan. The cash budget forecasts that though company will have adequate amount of opening cash balance on September, it cannot generate positive cash flow from operating activities due to the advance payment adjustment from customer. Hence, if the company repays the loan, the total cash balance will become negative and the company has to take short term loan again for its operational activities (Brigham and Ehrhardt 2013). The main risk, which is associated with the proposed loan, is the shortfall of cash balance. The company can reduce the risk level, if it negotiates with its suppliers to extend the credit period of 30 days to 60 days and does not pay the dividend on the month September. 5:- The forecasts, made by the president, are based on sales volume and future cash outlays in form of raw material purchase and operating expenses. It can vary with the actual figures if any of these factors differs from the assumptions (McDONALD 2016). The company expects that the sales volume will rise quite significantly due to faster economic development. It has assumed such future developments according the recent sales figures of big three companies in this sector. The factors, which has helped these three companies to improve the sales, may not be effective for small companies, like Jackson Limited. Therefore, the company may not enjoy such significant sales growth in the coming four months (McDonald 2013). The company expects to reduce the raw material cost and maintain the same amount for all the four months. It should be noted that if the productivity increases, then the raw material consumption would increase subsequently (DRURY 2013). Moreover, if the industry will face a economi development, then raw material price also rise according to its increasing demand. In both the cases, the raw material cost cannot be reduced and maintained at same level for the period of 4 months. The operating expenses are mostly variable expenses, which changes as per production and sales volume. Hence, unlike the assumption of the company, it will not remain same for the specified period, when the production and sales volume both will increase at high rate. Therefore, it can be stated that the assumptions, made for future projection, are not quite satisfactory and logical. There is high risk that the actual figures may differ greatly with the forecast and the company may not achieve its target as per the anticipation (Fleischmann et al. 2015). Moreover, the main issue of the company is the shortage of cash balance, which relies greatly on the sales figures. The sensitivity analysis, shown below, describes how the cash balance would vary according to the change in sales forecast:- Sensitivity Analysis:- Particulars Actual Option 1 Option 2 Option 3 Option 4 Rise by 10% Rise by 15% Fall by 5% Fall by 10% Actual Sales for 8 months 44,014 44,014 44,014 44,014 44,014 Projected Sales for 4 months 34,650 38115 39848 32918 31185 Total Annual Sales 78,664 82,129 83,862 76,932 75,199 Cash Balance on year ending (5,071) (2,340) (974) (6,436) (7,802) It is clear from the above table that the company will be able to pay off the term loan without any interruption in its operations, only if it would be able to increase the sales volume by 15% from the forecasted figures and avoid the dividend payment in the end of September (Hope and Fraser 2013). 6:- From the banks point of view, it can be stated that the current loan should not be extended and the additional loan should not be approved also. The financial forecast statements, given above, exhibit that the company will not be able to save enough cash fund at the end of the fiscal year for repaying both the loans. In such scenario, the bank cannot take such huge risk (Bluhm et al. 2016). As mentioned in the case study, Jackson Limited has performed at the adverse conditions quite well in past. The pro-forma income statement indicates that it will continue to earn profit in the near future also. Hence, the bank can consider it for loan (Bessis and O'Kelly 2015). In that case, it can reduce the risk factors by providing the loan against the accounts receivable balances or the finished goods inventories (Grubel 2014). If the company will not be able to pay the loan on time, then the bank can ensure the payment on encashment of accounts receivable or by selling the finished inventory balances (Brealey et al. 2012). 7:- The repurchase of common outstanding stocks can be very helpful for the companies, which are very much active in the stock markets. The company can reduce the quantity of outstanding shares and thus, it will be able to increase the earning per share (Evgeniou et al. 2016). The company may pay lesser amount for dividends as the dividend per share will rise due to lower numbers of shares. Thus due to increase in earnings per shares and dividend per shares, the stock price of the company uses to get increase quite significantly (Horngren et al. 2013). It is not sure that Jackson Limited is active in share markets or not. If it would intend to rise its stock prices in the market, then the decision of share buy-back is surely a good decision. However, nothing is mentioned in the case study about such intention. Rather, for such repurchasing the company had to take loan from bank. It has led the company to generate higher debt ratio (Andriosopoulos et al. 2013). Moreover, the companies use to repurchase its shares out of its excess cash funds. Jackson Limited did not have enough cash balance when it had re-purchased its own shares (Hofstede 2012). Therefore, the decision of share buy-back cannot be considered as fruitful or effective for the company. 8:- The company should not pay dividends at the end of September,2013, as it is quite sure that the company will face shortage of cash in that particular month. The main aim of the company should be the loan repayment only. It should save cash funds as much as possible and for that reason, it should avoid any cash outflows, which can be paid in the following year (Lorange 2013). Dividends payment is not fixed expenses. It depends on the financial situation and cash balances of the company. Jackson Limited has already paid interim dividend on March,2013. Therefore, if it will pay dividends in the next fiscal year from the total profit of the current year, there will be no problem at all (Patton et al. 2015). References:- Andriosopoulos, D., Andriosopoulos, K. and Hoque, H., 2013. Information disclosure, CEO overconfidence, and share buyback completion rates.Journal of Banking Finance,37(12), pp.5486-5499. Bessis, J. and O'Kelly, B., 2015.Risk management in banking. John Wiley Sons Bluhm, C., Overbeck, L. and Wagner, C., 2016.Introduction to credit risk modeling. Crc Press. Brealey, R.A., Myers, S.C., Allen, F. and Mohanty, P., 2012.Principles of corporate finance. Tata McGraw-Hill Education Brigham, E.F. and Ehrhardt, M.C., 2013.Financial management: Theory practice. Cengage Learning. Bryson, J.M., 2012. 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