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Shuman Automobiles, Inc.
Institute of Management
College of Social Sciences


Submitted By:
Ame, Donna Mae B.
Dela Pena, Melissa S.
Dulad, Jhune E.

Submitted to:
Sir Jay Stephen Siy

12 October 2006

Responsibility Accounting & Transfer Pricing

Facts of the Case:
1.    Clark Shuman, owner and general manager, plans to retire and relinquished his control over the company
2.    Business has been doing good with an emphasis of selling new cars as the principal business of the dealership
3.    He created three independent departments, namely new car sales, used car sales, and service department.
4.    Salary is dependent on each department's gross profit
5.    Upon the take over of the managerial positions, Janet Moyer of the new car sales had a first challenge of making a sale through a costumer who wanted to trade his old car with a new car.
6.    Moyer had to decide the amount she would offer the costumer for the trade in value of the old car.
7.    The new car model has been in stock for some time and the model wasn't selling.
8.    The list price of the new car is $14400.  
        List Price of New Car:    $14400
        Cost of the New Car:      12240
9.    Paul Fiedler, the used car manager, estimated the reconditioning work to cost $840, and the car could be retailed at $7100 or wholesaled at $6100.
10. &nbs ...
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Avon Case Study

Executive Summary : Avon Products, Inc. (Avon) is based in New York. The firm engages in the manufacture and marketing of beauty and complimentary products primarily in North America, Latin America, Europe, and Asia Pacific (Yahoo Finance, 2005). Avon's products are classified into three product categories: Beauty, Beauty Plus, and Beyond Beauty. The Beauty category consists of cosmetics, fragrances, skin care, and toiletries; Beauty Plus includes fashion jewelry, watches, apparel, and accessories; and Beyond Beauty comprises home products, gift and decorative products, candles, and toys (Ibid). The company sells and markets its products through a combination of direct selling, marketing by independent Avon representatives, and via its consumer Web site,
This paper will explore how the company is fairing under the leadership of its current CEO, Andrea Jung. There are two opposing views regarding the company's current and future success. One group feels that the firm has a promising future with Jung at the helm while the other group does not. This paper will analyze the pros and cons uncovered by each team member and discuss which view prevailed in the debate and why.
Pros of Jung and Avon : Andrea Jung became president and CEO of Avon in 1999 and has totally revamped the company. Under her leadership, the company has updated its product line, launched new advertising, and created a new image (Fact Monster, 2005). Avon's sales have increased by 30 %, profits 40%, and the stock price has dramatically improved (Ibid). Jung's has been able to align the firm's core capabilities with its strategic targets which has lead to phenomenal results. It appears that Jung has been able to establish a clear vision for the firm that has been inc ...

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