...uncertainty of the future. Managers are constantly trying to predict the future, making decisions in the present that will ensure the continued success of their firms. Managers use forecasts for budgeting purposes. A forecast aids in determining volume of production, inventory needs, labor hours required, cash requirements, and financing needs. A variety of forecasting methods are available. However, consideration has to be given to cost, preparation time, accuracy, and time period. The manager must understand clearly the assumptions on which a particular forecast method is based to obtain maximum benefit. 1 Types of Forecasts Short Term Short-range forecasts typically encompass the immediate future and concern the day to day operations of a firm. A short-term forecast usually only covers a period of a few months and can be considered an “operating” forecast. Medium Term Medium-range forecasts typically span a few months up to a year. A forecast of this length can be considered “tactical” in nature. Long Term Long-range forecasts typically encompass a period longer than 1 to 2 years. These forecasts are considered strategic and are generally related to management’s attempt to plan new products or build new facilities. 2 Forecasting Methods Time Series Regression Qualitative 3 Times Series Time Series Forecasting is the use of a model to predict future values based on previously observed values. They use historical data to predict future behavior. Time...
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...uncertainty of the future. Managers are constantly trying to predict the future, making decisions in the present that will ensure the continued success of their firms. Managers use forecasts for budgeting purposes. A forecast aids in determining volume of production, inventory needs, labor hours required, cash requirements, and financing needs. A variety of forecasting methods are available. However, consideration has to be given to cost, preparation time, accuracy, and time period. The manager must understand clearly the assumptions on which a particular forecast method is based to obtain maximum benefit. 1 Types of Forecasts Short Term Short-range forecasts typically encompass the immediate future and concern the day to day operations of a firm. A short-term forecast usually only covers a period of a few months and can be considered an “operating” forecast. Medium Term Medium-range forecasts typically span a few months up to a year. A forecast of this length can be considered “tactical” in nature. Long Term Long-range forecasts typically encompass a period longer than 1 to 2 years. These forecasts are considered strategic and are generally related to management’s attempt to plan new products or build new facilities. 2 Forecasting Methods Time Series Regression Qualitative 3 Times Series Time Series Forecasting is the use of a model to predict future values based on previously observed values. They use historical data to predict future behavior. Time...
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...decision making may involve whether to accept special order, make or buy, sell or process further, retain or replace equipment to name a few (Kimmel, Weygandt & Kieso, 2011). This paper discusses the option of incremental and comprehensive analysis and how it can be beneficial to decision making for managers. Furthermore, it elaborates on whether “Incremental analysis is considered to be more economical than a comprehensive analysis, while being just as effective or not” (Learning Assignment, week 6). Incremental Analysis The management usually faces two different types of decisions: a short-term, regarding the normal operation of the company, and long-term capital investments. The short-term decisions can be carried out and then make them retroactive actions to carry out the strategic company goals. In the long-term decision-making, many resources are involved and may include rigid and difficult processes. The short-term decisions may affect different areas that make up an organization, such as sales, finance, production, human resources, etc. There is a wide range of decisions which can be compromised the company's short term and that by their nature support be modified. The different types of decisions that involve incremental analysis are accept an order at a special price, make or buy, sell or process further, retain or replace equipment, eliminate an unprofitable business segment, and allocate limited resources according to Kimmel,...
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...useful in order to help predict future performance in the short and long term. It is important to note however that accounting information including accounting ratios show a company’s performance at a period in time. It is historical data. Trends can be identified by comparing data in sequential periods and future forecasts can be determined using historical data. There is no evidence or proof however, that these patterns will predict the future at a level of complete certainty. In my opinion, it would be hard to argue that decreasing profits over an extended period of time, or deteriorating liquid assets and increasing long term debt will have a negative impact if a trend continues. Eventually a company will have financial difficulties. Another type of predictive model that utilizes accounting information includes regression analysis. Regression analysis is viewed by many to be more useful that financial data or ratios alone. Regression analysis often test whether past stock prices, sales, profit, financial ratios, solvency, and other items are related to other variables including GDP, interest rates, market saturation of the industry, etc. In addition, a degree of confidence can be determined concerning the relationship of the variables in regression analysis Accounting ratios are determined from financial data, which as mentioned is historical. I do not feel that all financial ratios have the same impact however, when used as a predictor of future performance. Cash is a non-depreciable...
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... Dr. Pepper Snapple Group March 5th, 2013 Current Situation Analysis Mission/Vision Statement The Dr. pepper Snapple Group fuses its vision and mission statements saying, “At Dr. Pepper Snapple Group, it is our vision to be the best beverage business in the Americas. Our brands have been synonymous with refreshment, fun and flavor for generations, and our sales are poised to keep growing in the future.” This stamen is straightforward and informatively average. It establishes the company’s goal and core values. Also, it highlights DPS’ interest in future sales growth. The company includes its business strategy stating that it focuses on building and enhancing leading brands, pursuing profitable channels, packages and categories, leveraging an integrated business model, strengthening routes to markets, and improving operating efficiency (Dr. Pepper Snapple Group). External Analysis Government policies and regulations affect business development and growth. Products have to be consistent with the USDA’s dietary guidelines and adhere to the FDA’s standards for health claims. Due to the current post-recession economy, growth is expected to be slow since existing demand patterns are expected to change as consumers become more health conscious. Moreover, global awareness and concern regarding the impact of climate change continues to be a focal point as business seek to achieve better business in terms of reduced cost and risk while achieving positive impact on the world...
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...Personal Food Diary Guidelines Purpose The purpose of this assignment is to increase self-awareness of the student by analyzing personal nutritional intake and activity routine throughout the course. In turn, the student will be able to help others modify their diet and activity, and improve overall wellness. An examination of a personal food and activity assessment will provide the student with essential data from which to change their health and wellness behaviors. Course Outcomes This assignment enables the student to meet the following course outcomes: CO #1 Assess whether nutritional intake provides basic nutrients for optimal health and wellness. (PO #1, PO #2) CO #2 Describe nutritional needs for optimal health and wellness throughout the life span. (PO #1, PO #2) CO #3 Discuss the psychological, sociological, economical, and cultural implications of food on nutritional status. (PO #1, PO #2) CO #4 Describe evidence-based interventions and modifications in nutrition therapy that can positively influence the outcome of disease and illness. (PO #1, PO #8) Due Date Refer to Course Calendar for campus requirements. Online will submit by Sunday, Unit 7 11:59 pm MT. Total Points Possible: 100 Requirements 1. Create a concept map document based on the food and activity journal throughout the course using www.chooseMyPlate.gov. The discussion questions in units 1, 3, 5, & 7 will provide you with questions on what aspect of diet to focus on. You are...
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...Incremental analysis is sometimes referred to as incremental cost analysis, relevant cost analysis, or differential cost analysis. Incremental analysis is an accounting tool used to assist decision making by assessing the impact of small or marginal changes. However, incremental analysis is applicable to short and long-term issues. Using accounting information that provides important financial data such as costs and revenues is very important to companies. It helps the managers define what their options are on how to minimize cost increasing their profits. The decision making may involve whether to accept special order, make or buy, sell or process further, retain or replace equipment to name a few (Kimmel, Weygandt & Kiesco, 2011). Incremental Analysis In most cases management usually have to face two types of decisions: short term, which involves the normal operation of the company and long-term capital investments. However, the short-term decision can be carried out and then made retroactive actions to carry out the strategic goals of the company. Whereas the long-term decision making, there are several resources involved and sometimes it includes rough and difficult processes. Keep in mind that in some instance, short term decisions can affect different areas that make up an organization such as sales, finance, production, and human resources. The different types of decisions that involve incremental analysis are accept as an order at a special price, make or buy...
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...Introduction Financial analysis is the analysis of the financial statements of same company for two or more years or two or more companies for same year. Financial analysis gives the flawless picture of the performance factors of the company and also helps in evaluating and comparing the present as well as past performance of the company. Financial analysis is done with the help of ratio analysis, common size analysis, and comparative analysis. About Company Starbucks is an American global coffeehouse chain and coffee company based in Washington. It is the largest coffeehouse company in worldwide with 20891 stores in 62 countries with highest in the united Sates. The items which are served in Starbucks menu are cold and hot beverages, micro ground instant coffee, whole bean coffee, full-leaf teas, snacks and pastries with a quality which is preferred by all. The first store of Starbucks was opened on March 30, 1971 by three partners Jerry Baldwin, Zev Siegl and Gordon Bowker. Ratio Analysis Ratio Analysis is considered as the significant instrument of the financial analysis. The main purpose of ratio analysis is to develop a meaningful connection between the specific items in the income account or balance sheet. The users consist of investors, managers, investors, long-term creditors and short-term creditors. The managers are interested in knowing the asset utilization and profitability of the company because their promotions and bonus are dependent on the efficiency...
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...PESTLE Analysis (PEST analysis) The PESTLE acronym. Political Economic Social Technological Legal Environmental PESTLE Analysis is a simple technique which can be used in a fairly sophisticated way, particularly when it is combined with Risk Analysis, SWOT Analysis, an Urgency/Importancy Grid and expert knowledge about the organisation and its external factors. PESTLE Analysis is normally used to help organisations identify and understand the external environment in which they operate and how it will operate in the future. I believe that a version of PESTLE Analysis can be used by the individual for personal development planning. Some people will argue that this is a use for which it was never designed and for which it may be inappropriate. My answer to that is to “try it, it does work for PDP”. The shorter version is a PEST Analysis – missing out Legal and Environmental factors. At the end of this document is an explanation of the use of PESTLE for organisational change. How PESTLE may be used for PDP For PDP purposes view yourself as being ‘the organisation’ – an organisation subject to external factors, and internal factors. 1 For each of the 6 PESTLE factors brainstorm and identify 5-10 things which, based on existing knowledge, may change or are likely to change over the short term, medium term and long term. 2 Then assess/evaluate their likely impact/affect/relevance/importance on/to/for you. · Then narrow these down and rank them for importance/priority...
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...The Body Shop International PLC 2001: An Introduction to Financial Modeling Written Case Analysis Mitchell Bredberg-(12205176) Mitchell Sovis-(12156556) Jake Rux-(12159615) Zach Dorer-(12171436) Finance 465-001 11/10/15 I. Executive Summary Anita Roddick was the founder of The Body Shop International PLC. Despite growing a successful business, the company recently ran downhill after losing revenue growth starting in the late 1990s. One of the major problems was intense competition. This unexpected phenomenon caused The Body Shop to lose its image of being the “go to” place in Great Britain’s many shopping venues. Later on, a new CEO, Patrick Gournay, took charge and was faced with a declining pretax profit of twenty-one percent. Facing a dilemma, Gournay’s recommended plan of action included a focused product strategy of increased investment. He was confident this strategy would produce improved results. To be effective, this strategy incorporated a reduction in product and inventory costs as well as a reinforced stakeholder culture. To justify the course of action with this strategy, we will prepare a three-year financial forecast to help predict The Body Shop’s future earnings and financial needs. This forecast will be based on The Body Shop’s historical financial statements to create the best possible financial model going forward. II. Statement of the Problem When Anita Roddick was still CEO, the main problem affecting The Body Shop was not being...
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...Ques:1 Vision and mission statements provide information about the organization? What are they? How should they be developed and used? Ans: The term “strategic planning” is defined as process of an organization that clearly defines its strategy, or direction and making decisions on allocating its resources for proper planning. These two statements Mission statement and Vision statement clearly and concisely convey the direction of the organization. The Mission statement identifies a starting point or current state of business, but a Vision statement is necessary to determine what direction should be pursued. These help to communicate intentions and motivate team or organization to have a successful and common vision of the future. Mission statement: its development and use:- It defines the purpose of the organization and their primary objectives. The main functional point is internal and there is an involvement of leadership team and stakeholders. A perfect mission statement should determine why organization exists and what will achieve in future. Every organization has its own unique Mission statement. It should be easy to understand and should be simple so that every new employee could use it frequently. Generally mission statement of organization answer keys questions: * Purpose of the organization * Business of the organization * The value of organization Vision statement: its development and use:- It also defines the purpose of an organization but at the...
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...projection methods used by each organisation. After thorough analysis of the population projections created by the Australian Intergenerational Report, the United Nations (UN), the World Bank (WB), US Census Bureau (USCB), IIASA- INTERNATIONAL INSTITUTE for Applied Systems Analysis, and the Population Reference Bureau (PRB), it is highly apparent that each organisation employs the cohort-component method in terms of the development of their population projections. This can be seen as each population projection utilises the grouping of cohorts to update the age and sex specific components of population change fertility, mortality, and migration. (Idea/concept Provided from DEMOGRAPHIC RESEARCH, VOLUME 4, ARTICLE 8, PAGES 203-288 PUBLISHED 13 JUNE 2001). However it is evident that each organisation also has subtle variations within their form of the cohort-component method in comparison to each other. These are only subtle differences such as Different age grouping. ii. Compare and contrast the main characteristics of the long term population projections produced by the UN, the WB, USCB, IIASA and PRB (mention at least two points for each organisation) It is highly clear that amongst all the population projections produced by the UN, the WB, USCB, IIASA and PRB that there are both similarities and differences, which occur in terms of the characteristics of each population projection. Both the USCB and UN are similar terms of both their population projections where last introduced...
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...FORECASTING - a method for translating past experience into estimates of the future. Forecasting is the process of making statements about events whose actual outcomes (typically) have not yet been observed. A commonplace example might be estimation of the expected value for some variable of interest at some specified future date. Prediction is a similar, but more general term. Both might refer to formal statistical methods employing time series, cross-sectional or longitudinal data, or alternatively to less formal judgemental methods. Usage can differ between areas of application: for example in hydrology, the terms "forecast" and "forecasting" are sometimes reserved for estimates of values at certain specific future times, while the term "prediction" is used for more general estimates, such as the number of times floods will occur over a long period. Risk and uncertainty are central to forecasting and prediction; it is generally considered good practice to indicate the degree of uncertainty attaching to forecasts. The process of climate change and increasing energy prices has led to the usage of Egain Forecasting of buildings. The method uses Forecasting to reduce the energy needed to heat the building, thus reducing the emission of greenhouse gases. Forecasting is used in the practice of Customer Demand Planning in every day business forecasting for manufacturing companies. The discipline of demand planning, also sometimes referred to as supply chain forecasting, embraces...
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...serve as a valid predictor of future financial performance. It is understood and often disputed that predicting financial performance beyond a time horizon of four years, using accounting analysis is not as reliable as initially determined. Based on both academic research studies and reviews alongside nonacademic reviews, it seems plausible to a certain comfortable level that it is possible to incorporate targeted and focused accounting information and ratios in conjunction with additional industry/market based variables within statistical models to be successful in predicting future performance beyond the short run. Financial ratios, together with other analyses, are widely used as critical indicators in evaluating a firm’s performance. One question constantly arises, which financial ratios are informative among the hundred ratios available? Material below will identify and support particular ratios of focus. Research also suggests that in order to accurately forecast future financial performance, accounting information needs to work alongside other variables (i.e. firm size, economic trends, and industry specific ratios). Beyond the microeconomics of the company, analysis should also consider relevant macroeconomics that can have a direct correlation on a firm’s success. Based on all findings included, there has been no distinct criticism of using accounting information beyond the time horizon of four years as a mechanism to predict longer term horizon performance. But a more...
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...strategic thinking to resolve parallel issues. Strategic thinking is the approach in which group in an organization think about, access, view, and creates the future for themselves and their associates. It is more than responding to day-to-day as well as long-term problems, opportunities, and new realities; it is creating tomorrow. Strategic thinking is not reactive, but proactive. It focuses on how to create a better future by being proactive and adding value to society-through the accomplishment of high payoff results. Strategic thinking always involves change, and often, profound personal change. It is a change in ones mindset. Strategic thinking is imagining the results one wants to achieve in the future and creating an ideal future by defining and achieving results that adds values to the company. The Houston Public Library can also review how the Houston Zoo went from a city department to a private foundation. Strategy, in business, is the combination of foresight, planning, and decision-making that prepares an enterprise to achieve long-term goals and manage the consequences of contemporary decisions. When creating a strategy the firm needs to decide on both short-term and long-term objectives. The qualities of effective short-term objectives are measurable, priorities, and must be linked to the long-term objectives. Short-term objectives added benefits of values to the firm. Company needs to implement an action plan by giving personnel a better understanding of his or her role...
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