- •Череповецкий государственный университет
- •Кафедра экономики
- •Современный бизнес
- •Contents
- •Введение
- •Unit 1. The effects of demand and supply on business
- •1.1. Markets
- •Test Questions
- •Case study ‘Understanding the Market’
- •1.2. The Operation of Markets
- •If social costs exceed social benefits, the decision to produce a good or service makes society worse off even if the producers make a profit.
- •If social costs are less than social benefits, the decision to produce a good or service will make society better off. Test Questions
- •Case study ‘Record Industry’
- •1.3. The Effects of Government Policy on Markets
- •Indirect taxes
- •Test Questions
- •Unit 2. The competitiveness of a firm
- •2.1. The Performance of an Industry
- •International Trade
- •International comparisons
- •2.2. Government Action to Improve Competitiveness
- •2.3. Government Action and International Trade
- •2.4. Business Competitive Strategies
- •Test questions
- •Case Study
- •Unit 3. Business Organisations
- •3.1. Types of Business Organization
- •3.2. Organizational Structures
- •3.3. Factors Influencing the Organisational Structure
- •Internal factors
- •Test Questions
- •Case Study ‘Business Organisation & Structure’
- •Unit 4. Administrative systems
- •4.1. The Purpose of Administrative System
- •4.2. Administration Functions in Business
- •4.3. Evaluating Administrative Systems
- •4.4. Information Technology in Administration
- •Test Questions
- •Case Study ‘Satellite Supplies’
- •Unit 5. Communications Systems
- •5.1. Why Do Businesses Need Communications System?
- •5.2. The Objectives of Communication
- •5.3. Verbal Communication
- •Internal communications
- •5.5. Evaluating Communication Systems in Business
- •Test Questions
- •Case Study ‘Can You Communicate?’
- •Unit 6. Information Processing
- •6.1. The Purposes of Information Processing
- •6.2. Types of Information Processing Systems
- •Information Technology: positive and negative effects
- •6.3. Evaluating Information Processing Systems
- •Test Questions
- •Case Study “Information Technologies in Business”
- •Unit 7. The principles and functions of marketing
- •7.1. What is Marketing?
- •7.2. The Objectives of Marketing
- •7.3. Implementing the Marketing Mix
- •Test Questions
- •Unit 8. Market Research
- •8.1. What is Market Research?
- •8.2. Sources of Marketing Information
- •Information requirements
- •Internal sources
- •8.3. Primary Research
- •8.4. Market Changes
- •Information on sales
- •Test Questions
- •Case Study ‘Sun Rush’
- •4M Brits shrug off gloom in sun rush
- •Unit 9. Marketing Communications
- •9.1. Targeting an Audience
- •9.2. How to Reach a Target Audience
- •9.3. Product Performance
- •9.4. Guidelines and Controls on Marketing Communications
- •Test Questions
- •Case Study ‘Marketing Communication’
- •Unit 10. Customer Service and Sales Methods
- •10.1. ‘The Customer Is Always Right’
- •10.2. Placing the Product – Distribution
- •Indirect distribution via intermediaries
- •10.3. Closing the Sale
- •Test Questions
- •Case Study ‘Company Handbook’
- •Unit 11. Production
- •11.1. What is Production?
- •11.2. Just in Time Production and Total Quality Management
- •11.3. Improving the Productivity of Labour
- •11.4. Health and Safety at Work
- •11.5. Reducing Pollution from Production
- •In the working environment
- •In the natural environment
- •Test Questions
- •Case Study ‘Production and Productivity Consulting’
- •11.6. The Costs of Production
- •Identifying business costs
- •Indirect costs
- •Insurance
- •Variable costs
- •Test Questions
- •Case study ‘Waterhouse Waffles’
- •Unit 12. Pricing decisions and strategies
- •12.1. The Pricing Decision
- •12.2. Cost-Based Pricing
- •12.3. Market-Based Pricing
- •12.4. Competition-Based Pricing
- •12.5. Problems with Demand- and Competition-Based Pricing
- •Test Questions
- •Case Study ‘What Price Promotion?’
- •Unit 13. Monitoring business performance
- •13.1. Accounting for Business Control
- •13.2. Budgetary Control
- •Variance analysis
- •13.3. Ratio analysis
- •Test Questions
- •Case Study ‘Business Performance’
- •Unit 14. Preparing a business plan
- •14.1. What Is a Business Plan?
- •14.2. The Purposes of a Business Plan
- •14.3. Legal and Insurance Implications
- •Insurance
- •14.4. Business Resources
- •14.5. Potential Support for a Business Plan
- •Some review questions
- •Unit 15. Producing a Business Plan
- •15.1. Business Objectives and Timescales
- •15.2. The Marketing Plan
- •15.3. The Production Plan
- •15.4. The Financial Plan
- •15.5. Conclusion
- •Some Review Questions
- •Case Study ‘Business Plan’
Case study ‘Waterhouse Waffles’
Waterhouse Waffles produces cream filled waffles for sale in supermarket freezer sections.
The accounts department has calculated that the cost of producing 400,000 waffles each quarter are as follows:
Direct costs |
(£) |
|
Indirect costs per Qtr |
(£) |
Labour |
70,000 |
|
Rent |
5,100 |
Materials |
25,000 |
|
Rates |
1,000 |
Power |
5,000 |
|
Power (offices only) |
1,250 |
|
|
|
Marketing |
1,550 |
|
|
|
Telephone |
650 |
|
|
|
Business travel |
550 |
|
|
|
Office Supplies |
850 |
|
|
|
Insurance |
450 |
|
|
|
Depreciation |
250 |
|
|
|
Other overheads |
350 |
Using this information, Accounts have calculated that the variable cost of producing each waffle is 25 pence. It has also estimated that indirect costs would remain the same for levels of output between 200,000 waffles per quarter and 600,000 waffles per quarter. At 600,000 waffles per quarter the factory is working at full capacity.
To increase output above 600,000 waffles per quarter the firm would need to expand into new premises and install new computer controlled equipment. A nearby factory unit meeting the requirements of such expansion plans has been identified and will cost a total of £9,000 in quarterly rent and rates – £2,900 more than at present. A long-term loan to buy the new equipment would cost £3,300 per quarter in repayments. Other indirect costs are assumed to rise by around £800. The variable cost per waffle would stay the same.
Tasks:
Produce a short report for the Managing director of Waterhouse Waffles, explaining the difference between:
-
direct and indirect costs
-
fixed and variable costs
-
average and marginal costs per waffle
-
Also include in your report an explanation of the following terms:
-
cost units
-
depreciation
Now use a computer spreadsheet to undertake tasks below. Generate computer print outs of your calculations to include in your report.
Using the information above calculate the total cost of producing the following amount of waffles each quarter:
-
200,000
-
400,000
-
600,000
What is average cost of producing each waffle at the present level of output of 400,000 waffles per quarter?
If Waterhouse Waffles wanted to make a profit of £128,000 each quarter from the sale of 400,000 waffles what price should it charge for each waffle?
Suppose the firm does decide to expand production to 800,000 waffles each quarter. Calculate the total cost of this level of output and then use the information on the change in total costs and output to calculate the marginal cost of producing each additional waffle over an output of 600,000.
Assuming the firm is able to sell the additional waffles at the same price chosen in the previous task would you advise the firm to go ahead with its expansion plans?