...growing, you’re dying. But companies also need to focus on controlling costs. Without constant vigilance, companies can find themselves in an uncompetitive situation with bloated overhead. The episodic slashing and burning that then becomes necessary can significantly damage a company. These efforts risk producing exceptions on the financial statements, drive “one-time” charges, and hurt company culture. The better way to maintain the appropriate cost structure is to control them in a sustained fashion. Here are 5 ways to control costs. 1) Renegotiate all contracts annually. For whatever reason, American businesses presume that multiple year contracts will result in lower costs. Maybe sometimes, but not always. A smart company policy is not to have the life of a contract exceed one year. This forces annual bidding or at least renewal discussions with the current suppliers. Almost always these discussions will result in lower cost of goods. A multi-year contract will usually favor the vendor. Of course this is a lot of work. But it sure pays out. 2) Ask your customers. Annual planning sessions with customers have many benefits. Naturally these discussions primarily should focus on ways to grow the business. But too often these discussions fail to address costs. By discussing costs holistically up and down the combined supply chains, customers often can recommend ways to reduce costs. For example, how to take wasted steps out of the process, or how to...
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...Here are five ways to get expenses low, and keep them low. 1. Cost and benefit analysis Appraisal of the costs and benefits of any new decision is an invaluable tool at your disposal. To perform an effective analysis, you need as much information as possible on the decision. Any pertinent numbers that are not available should be estimated as realistically as possible. Comparing the likely expenses and revenues that will accrue from a new investment, purchase, hire or other major decision shows you the potential effect on profit as well as cash flow. There is some research involved, but once the estimates have been established, cost-benefit analysis is relatively straightforward. Simply compare the total expenses and total revenues, and make the final decision. To estimate costs and revenues, you can use past experience, quotes from vendors, any information available from competitors, or projections based on existing trends and patterns. For instance, if you are considering replacing your computer system with more modern state-of-the-art computers, you can estimate the cost of purchasing and installing the new machines, as well as the value of time lost while workers are trained or get accustomed to the new equipment. There might be an expense for training employees in the new system as well. On the positive side, you would consider what tasks the new computer system will speed up, if you will be able to produce more products more quickly, any gains to internal or external...
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...COST MANAGEMENT AND PRODUCTION CONTROL FOR CONSTRUCTION COMPANIES Marchesan, P.R.C.1; Formoso, C. T.2 ABSTRACT Construction, like other industries, has been experiencing profound changes involving both the business environment and internal organization. In this context, new cost management information that provides better understanding and helps managing increasingly turbulent and complex production processes is needed. Activity-based costing (ABC) has been suggested as the leading contender method to replace traditional cost accounting systems, due to its capability to make the processes and activities performed in the organization more transparent and observable. This paper reports the main results of a research project which aimed to develop a cost accounting system capable of providing useful information to manage production processes in construction and devise a model that integrates this system to the Production Planning and Control process, based on the new operations management paradigm and on the ABC ideas. The study involved three case studies, a series of interviews with construction managers and the development of prototype software. The main conclusions of this research work are that the cost information provided by the proposed management accounting system (a) makes the production processes more transparent; (b) helps to identify production inefficiencies; (c) encourages managers to introduce corrective actions; and (d) allows the evaluation of corrective actions...
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...Arthur H00112430 Construction Project Management 2011 to2012 D39CC Andrew Jackson Coursework title Design Cost Planning and Control Coursework hand-in deadline (date specified for hand- in) June 22 2012 All students are advised to keep a duplicate copy of all work submitted for reference. DECLARATION I certify that this assignment is my original work expressed in my own words. Any reference made to the work of other authors in any form (eg ideas, figures, text, tables) are acknowledged at their point of use. Signature/s of student ……………………………… Date of submission: ……………………… Below this line for office use only ………………………………………………………………………………………………………………………………………… School of the Built Environment Heriot-Watt University Edinburgh EH14 4AS Scotland UK Tel: 0131 449 5111 Fax: 0131 451 3161 Date Stamp Assignment: A high –level report, advising the client on the viability of the proposed project, a three storey Health Center, 4500 m2 Gross Floor Area (GFA). 1 Table of Contents Introduction………………………………………………………………………………………………………………3 BCIS Analysis Data………………………………………………………………………………………………………4 Sustainability………………………………………………………………………………………………………………..6 Building Research Establishment Assessment Method………………………………………………8 Appendices…………………………………………………………………………………………………………………9 References……………………………………………………………………………………………………………………15 Introduction Construction Cost Estimating is considered one of the most essential tasks in the budget development of any project. In most...
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...TOOLS AND AID IN COST CONTROL CONVERSION UNITS FOR VOLUME, WEIGHT AND TEMPERATURE Conversions are very handy in the kitchen, being very useful for standardized recipes, as well as kitchen specifications and many other documents used in the upkeep of kitchen records such as inventory, purchase specifications and standardized recipes. Below is a list of common weights and measures and their corresponding equivalents. Volume 1 US tablespoon | = | 3 US teaspoons | 1 US fluid ounce | ≅ | 29.57353 milliliters (ml) | 1 US cup | = | 16 US tablespoons | 1 US cup | = | 8 US fluid ounces | 1 US pint | = | 2 US cups | 1 US pint | = | 16 US fluid ounces | 1 liter (l) | ≅ | 33.8140227 US fluid ounces | 1 liter (l) | = | 1000 milliliters (ml) | 1 US quart | = | 2 US pints | 1 US gallon | = | 4 US quarts | 1 US gallon | = | 3.78541178 liters | Weight 1 milligram (mg) | = | 0.001 grams (g) | 1 gram (g) | = | 0.001 kilograms (kg) | 1 gram (g) | ≅ | 0.035273962 ounces | 1 ounce | = | 28.34952312 grams (g) | 1 ounce | = | 0.0625 pounds | 1 pound (lb) | = | 16 ounces | 1 pound (lb) | = | 0.45359237 kilograms (kg) | 1 kilogram (kg) | = | 1000 grams | 1 kilogram (kg) | ≅ | 35.273962 ounces | 1 kilogram (kg) | ≅ | 2.20462262 pounds (lb) | 1 stone | = | 14 pounds | 1 short ton | = | 2000 pounds | 1 metric ton | = | 1000 kilograms (kg) | Temperature Conversion Range EXERCISE Below is a conversion chart with the initial...
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...Cost Analysis and Control System: Guillermo Furniture Store Accounting/ACC561 October 04, 2010 Cost Analysis and Control System: Guillermo Furniture Store Guillermo Navallez (Navallez) has several important decisions to make regarding the future of Guillermo Furniture Store (GFS). Computations of return on investment, residual income, economic value-added data, and break-even analysis provide insight for decision-making and development of optimal performance measures. Choosing the most lucrative course of action requires analyzing cost relationships and behaviors, developing a management control system that helps set production standards and goals, and ties managerial efforts to organizational goals. Measures of Profitability GFS measures the performance of the organization by linking balance sheets from previous periods in 2008 and matching its sales, cost of goods sold, and other expenses in its income statement for June 2008 (see Table One). The table includes return on investment (ROI) ratio, residual income, and economic value-added (EVA) amounts that measure investment-center performance. Table One Return on investment (ROI) is a measure of financial performance defined as income divided by the investment made to earn that income (University of Phoenix, 2010, Week Six Supplement). The calculated rate of ROI uses percentages as a means of simplifying comparisons between different sizes of investments within the organization, and between different...
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...TAXES ( Read full story on taxes ) * Standard rate of excise duty held at 10 percent; no change in CENVAT rates * Personal income tax exemption limit raised to Rs 180,000 from Rs 160,000 for individual tax payers *For senior citizens, the qualifying age reduced to 60 years and exemption limit raised to Rs 2.50 lakh. *Citizens over 80 years to have exemption limit of Rs 5 lakh. * To reduce surcharge on domestic companies to 5 percent from 7.5 percent. * A new revised income tax return form 'Sugam' to be introduced for small tax papers. * To raise minimum alternate tax to 18.5 percent from 18 percent ( Read story ) * Direct tax proposals to cause 115 billion rupees in revenue loss * Service tax rate kept at 10 percent * Customs and excise proposals to result in net revenue gain of 73 billion rupees * Iron ore export duty raised to 20 percent *Nominal one per cent central excise duty on 130 items entering the tax net. Basic food and fuel and precious stones, gold and silver jewellery will be exempted. *Peak rate of customs duty maintained at 10 per cent in view of the global economic situation. *Basic customs duty on agricultural machinery reduced to 4.5 per cent from 5 per cent. *Service tax widened to cover hotel accommodation above Rs 1,000 per day, A/C restaurants serving liquor, some category of hospitals, diagnostic tests. *Service tax on air travel increased by Rs 50 for domestic travel and Rs 250 for international travel in economy class. On...
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...Budgets & Break-even analysis. P6 Illustrate the use of budgets as a means of exercising financial control of a selected company Fixed Costs- The running costs of a business such as rent and wages. Variable Costs- Costs that varies with the level of output or sales.An example of a variable cost would be direct labor costs. The breakeven point to two decimal places is 6.12 (£68) | Fixed Cost | Variable Costs | Total | Revenue | Profit/Loss | 0 | 416 | 0 | 416 | 0 | -416 | 1 | 416 | 12 | 428 | 80 | -348 | 2 | 416 | 24 | 440 | 160 | -280 | 3 | 416 | 36 | 452 | 240 | -212 | 4 | 416 | 48 | 464 | 320 | -144 | 5 | 416 | 60 | 476 | 400 | -76 | 6 | 416 | 72 | 488 | 480 | -8 | 7 | 416 | 84 | 500 | 560 | 60 | 8 | 416 | 96 | 512 | 640 | 128 | 9 | 416 | 108 | 524 | 720 | 196 | 10 | 416 | 120 | 536 | 800 | 264 | Three ways in which the Hotel Excellent can attract more customers for 2011 and reasons why the method would be effective: 1) Cut down on the variable and fixed costs. The hotel’s costs have risen which has resulted in more loss than profit, therefore if the hotel lower their costs there may be more room for profit. The hotel could get their supplies from cheaper suppliers, could switch companies for their electricity, gas, water and lay off staff if a high volume of staff is not essential. 2) To increase sales the Hotel Excellent could advertise and promote themselves more; this will bring publicity and attention to the hotel. Advertising...
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...Comparing Cost Control Strategies Kristy Barbeau HCR/230 Wednesday January 22, 2014 Beth Schalm Comparing Cost Control Strategies Employer sponsored insurance falls under what is called group health plans. When an employee has this coverage the group are the ones that are the policyholders. The health care plans are negotiated through the human resources department and they select what plans to offer the employee. Most plans are the basic plans and that is where the riders come in. what riders mean is it gives the employee the option to choose what health care plan they want to choose. These options may include vision and dental add-ons. Another rider could be services such as massages, nutrition counseling, and possible vitamin supplements. Some insurance plans would not cover these things. It just depends on the plan that is chosen. An employer may also choose the Federal Employee Health Benefits Program (FEHB), which happens to be the largest health care program that the employers use. However, the government controls this plan. This is the plan they use for the government workers, people who retired from the government, and their families. Another plan that employers use is the Self-Funded Health Plans. This is for many large companies to ensure the cost of the employees’ medical benefits come from them rather than buying them from different insurance companies. This plan is basically a self-insured plan but the employer sets the level of benefits the employee gets...
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...and control quality and performs quality assurance. If you include these processes in your Project Quality Management process, your will improve the quality of your current and future projects. The first process of Project Quality Management understands the scope and deliverables of the project. In order to give high quality to your customer or stakeholders, you must know their expectation of the service or product. The basic approach of quality management is compatible with ISO International Organization for Standardization quality standards. Every project should deliver quality to which a set of inherent characteristics fulfill requirements with a grade as a design intent assigned to deliverables having the same functional use but different technical characteristics. The project team will need to apply appropriate levels of accuracy and precision for use in the quality management plan. Applying ISO compatibility to quality management, you will need to take the approaches below: • Customer satisfaction –Customers expectations are met (PMI, pg 229). • Prevention over inspection –Prevent mistakes than correcting mistakes by planning, designing and building quality in to the project’s deliverables (PMI, pg 229). • Continuous improvement- Apply different quality improvement models to continue improvement (PMI, pg 229). • Management responsibility – Make sure project team has adequate resources to follow the quality plan (PMI, pg 229). • Cost of quality – Total cost of...
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...Construction Project Controls: Cost, Schedule, and Change Management UP-201 September 2004 CURT Owner Member Companies Abbott Laboratories Air Products & Chemicals, Inc. Ameren American Electric Power Baxter Healthcare Corporation Boeing Company Caterpillar Inc. Citigroup ConocoPhillips DTE Energy The Dow Chemical Company E.I. Dupont De Nemours & Company Eastman Kodak Company Ernst & Young ExxonMobil Chemical Company FMC Corporation FirstEnergy Corporation General Electric Company General Mills, Inc. General Motors Corporation HCA Healthcare Corporation Hercules, Inc. Honda of America Mfg., Inc. IBM Intel Corporation Johnson & Johnson Kansas City Power & Light Company The McGraw-Hill Companies MeadWestvaco Corporation Merck & Company, Inc. Owens Corning PSEG Power, LLC Pfizer, Inc. The Procter & Gamble Company Rohm and Haas Shell Global Solutions (U.S.), Inc. Southern Companies Sunoco, Inc. TECO Tampa Electric Company Toyota Motor Mfg. North America Tyco International U.S. Army Corps Of Engineers U.S. General Services Administration The University Of Cincinnati Associate Member Companies Alberici Group, Inc. BE&K Bechtel Egizii Electric, Inc. Fluor Corporation Hunt Construction Group Jacobs Engineering Group Rudolph/Libbe Companies The Shaw Group, Inc. Tetra Tech FW Inc. Turner Construction Company Zachry Construction Corporation Association Associate Members Associated Builders and Contractors (ABC) Associated General Contractors of America (AGC) Mechanical Contractors...
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...Executive Summary Schedule 0 Schedule 1 Performance Analysis Estimate at Completion Cost and Schedule Control Plan Revised Estimate at completion Schedule 2 Conclusion Executive Summary The new indoor theme park project is initially planned for duration of 180 Days with a start date of Apr 14, 2008. The actual initial planned cost was $4,846,920. The theme park attraction includes Ferris wheel, Bowling alley, Climbing wall, Carousel, Go Cart and mini golf. The project is broken into 3 levels and has various tasks. The final walk through is scheduled on Dec 18, 2008 with a grand opening on Dec 19th. The report is prepared to analyze the schedule and cost of the Indoor theme park project. The provided project information/data was used to create the project schedule which represents the project at a specific point during implementation. The Microsoft Project is used to serve as the tool to perform the project monitoring and control. The MS Project was also used to calculate the Earned Value Analysis. The output of the analysis, combined with a control plan, will be used to support the continuation of the project. The indoor theme park project is almost 5 months since inception and only 40% of the tasks are complete. The Actual cost is not provided so we can assume that costs are in control so we are not planning to take any corrective actions to control costs. Schedule...
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...the local people and incorporating the image of the locals on its planes. This identifies the airline with local customers. It is the preferred airline for the people in Alaska where air transport plays a major role in transportation of goods and services. ii. The airline offers specialized training for its pilots and staff on how to fly in difficult terrain. This differentiates it from other competitors in the industry. It pioneered latest navigation technology to enable it to safely operate in rough terrain and weather conditions. This is a competitive advantage against other airlines. Such features and training have led to a higher safety and high reliability rating. iii. The airline is able to keep its operational and marketing costs low because it has implemented a system that has the ability to measure 50,000 points in its performance and eliminate waste. This has increased its competitive capacity. This has a...
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...Medical Insurance Control Strategies Joyce A. Holt HCR/230 07/20/2010 Myrnell LaShay Martin, MBA/HCM Many employees have medical insurance coverage under group health plans (GHP) that the employers buys from insurance companies. Human resources department manage these health care benefits negotiating with health plans and selecting a number of products to offers employees. Both basic plans and riders offered, riders consist of option purchased by employees to add coverage such as vision and dental. In addition, complementary health care a popular rider covering treatment as in chiropractic, manual manipulation, acupuncture, message therapy, dietetic counseling, and vitamin, and minerals. Employers select certain benefits changing standard coverage or providers during negotiations to reduce the price, an employer may omit specific benefits. For example, coverage of prescription drugs, different provider network (for certain type of care), hire a pharmacy benefit manager (PBM) to operate the prescription drug benefit more inexpensively. Although some large companies the employer cover the cost of employee medical benefits rather than buying insurance from other companies. The employers create self-funded health plans that do not pay premiums to an insurance carrier or a managed care organization. Large companies insure themselves and assume the risk of paying directly for medical services, setting aside funds with which to pay benefits. They may also buy...
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...Good project cost estimations are critical to a successful project. With that in mind, compare and contrast parametric estimating and vendor bid analysis as cost estimation techniques on a project. Please provide an example of each. (Points : 20) Parametric estimation is based on a number of similar data points of performing similar work packages in the past”. Kuehn, Ursula (2011-04-07). It is a very accurate and easy estimating technique. A formula is developed for estimating the time or resources needed to perform a project activity. The formula is usually based upon a great deal of historical experience. It provides an invaluable service in the course of the project. Parametric estimating refers, primarily, to an estimation technique which utilizes the statistical relationship that exists between a series of historical data and a particular delineated list of other variables. However, when it comes to the vendor bid analysis is a technique used when working with suppliers on uncertain activities. it is simply seeing the costs via quotes, bids, proposals offered for a project work. Is a technique used when working with suppliers on uncertain activities? The analysis considers the assumptions the vendor worked with and does a sensitivity assessment on those assumptions. In addition, for effort that the buying organization does not have experience with, they can contract with a consulting firm that has experience to do a "Should Cost" analysis. This "Should Cost" estimate...
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