Nestl”s Nespresso

INTRODUCTION During the 70s, Nestle anticipates the growth of the market of the up-market coffee and is inspired by the original concept of the inventor of the espresso Luiggi Bezzera. The principle is simple: offer directly at home or to the office the quality of espressos served in the best Italian cafes. Based in 1986, Nespresso looked like pioneer on the market of the portioned out coffee and introduced a new tendency which will be adopted all over the world.And since the subsidiary of the international group Nestle did not stop surprising: more than 3 million customers worldwide, a growth superior to 30 % during 6 consecutive years and crossed for the first time the billion Swiss franc cap of turnover in 2006. The concept Nespresso leans on a trilogy: the best big vineyards of cafes, machines in espresso ingenious in the elegant design and finally, a service outstanding personalized customer. Nestle Nespresso S.A, whose seat is to Paudex, in Switzerland, counts more than 2500 em ployees, markets directly its products with its consumers in more than 50 countries and manages more prestigious 160 shops situated in most big cities of the world Cafes contained in capsules Nespresso result from various regions of the world such as Brazil, Colombia, Costa Rica, Guatemala, Togo, Kenya and Ethiopia. Its range includes ‘espressos’, a range which samples in small cups (40 ml), and ‘lungos’, for the big cups (110 ml), without forgetting the editions limited by variety show of coffee produced in limited quantity and for a while given.Nestle Nespresso limited company maintained, from its debuts, the narrow business connections with manufacturers of famous household electrical devices and carefully selected. Every partner hatches is responsible for the distribution, for the marketing, for the referencing in boutiques and the after-sales service of the machines of its own brand. At the moment, Nespresso accounts 10 partners for domestic customâ₠¬â„¢s machines with, offering various models of machines Nespresso. Machines and capsule Nespresso Professional are also available on the Internet site, www. nespressopro. om, as well as through a network of importers and independent distributors, subsidiaries of Nestle Nespresso limited company and local structures of the Group Nestle. Today, the activities â€Å"except place of residence† of Nespresso represent 25 % of the turnover of the sales of portioned out coffee. And to seduce the consumers, Nespresso uses big means: place of boutiques, design of machines, glossy paper magazine, secondary purified†¦ Nothing is left at random, everything is thought to evoke the refinement of the brand. The success of this company represents an interesting book case; a case of rare innovation.That’s why we chose Nespresso. In the present work, we shall approach first of all the history of Nespresso since its launch until our days. In a second time we shall speak about the ma rketing analysis of the company as well as about main competitors. After the study of the strategy, we shall enclose this report by recommendations. 1. 0 BACKGROUND TO COMPANY: Strategy’s history In the 70s, the Research and development services of Nestle turn to an integrated system: a machine receiving doses ‘encapsulated ‘of coffee, every dose corresponding to a cup of coffee of 50 cc.They invent the capsule of coffee freshly ground and its concept of extraction of the coffee under pressure. Nestle, world leader of the coffee â€Å"mass market† gets ready to attack the segment of up-market † premium coffee † thanks to this technical innovation say. A first patent of the process is registered in 1976 by the centre of development of the Group Nestle. It is only in 1986 that the marketing begins. First of all, by the creation of the company Nespresso S. A, the wholly-owned subsidiary of the group Nestle to Vevey.Then Nespresso dashes by targetin g the Business to Business market, particularly that of offices and restaurants. The company opted for Switzerland, Italy and Japan as country of starting up of its activity of marketing. Turmix, a Swiss company, took charge of the production of machines. Nespresso bought the capsules of coffee from Nestle, the machines to Turmix and dedicated itself to its marketing in association with a Swiss distributor ‘ Sobal ‘. But the success is not there: sales do not exceed 875 machines first year and it will not be better next year.We are in 1988, Nespresso begins to wonder about the efficiency of its strategy and in order to boost the company, appoints a new general manager: Jean-Paul Gaillard who decides to change all the strategy. He asks on one year of respite and a marketing budget of 1. 6 millions. His purpose: make of the ‘capsules percolator’ a luxury. Nespresso thus decides to transfer to the private individuals, and chooses to replace the word â€Å"caps ule† to speak about â€Å"vineyards â€Å"like wine and about â€Å"limited series â€Å".As for the distribution, it will be exclusive and direct for the capsules of coffee by introducing the concept of â€Å"Club Nespresso† which will allow its members to buy that by mail, telephone and fax (internet recently). Year 1989, the new strategy is launched in Switzerland. JP. Gaillard made a test, in 1990, on the market of the United States by changing variety of coffee to adapt itself better to the customs of the American consumers. At the end of the year the club counted already 7700 members. In 1991, The Nespresso system is introduced in France, in Belgium in Germany and In the Netherlands.And in 1994, Nespresso penetrated into the market of airline companies (First and business class) with its new machine ‘Nespresso Aviation System’. Present in 15 countries in 1995, Nespresso granted licenses of production to the other manufacturers in a precise purpose : the improvement of the performances, the convenience of use as well as the design. Nespresso S. A blew its 10 candles of success, in 1996, with 3 500 selling points and 180 000 members. Targeted the sector of restaurants and hotels in Belgium and in France and went in Great Britain, in Malaysia, in Singapore and to Taiwan.In 1998, it expands its field of action thanks to a new Web site completely dedicated to the members of the club so offering the possibility of ordering on-line 24 hours a day, and 7 days a week. This distribution channel also provides a personalized service, advices on blends of coffee and the maintenance of machines. In 2002, the production capacity of capsules is multiplied by 4 to answer the future growth and the orders placed on Internet know an increase of 94 % during year. The deals on Internet represent then 30 % of the turnover of the company.After 5 years of research and development, Nespresso launches in 2003 the first machine Nespresso Concept Automat ique which allows the preparation of capuccino. Other important point: the company goes into the sustainable development by trying to combine quality of selected vineyards of coffee and condition of production according to the rules of the sustainable development with its program AAA Sustainable Quality. It was a good initiative, especially after the different criticisms that the company received.Notably as regards to the capsule Nespresso which is in aluminum, hence pollution and a spending of energy, not compatible with the brand image and the ‘Natural image’. Given that the success of Nespresso and the unitary daily consumption, this problem of the lack of recycling presents a big blackhead at the same moment on the ecological plan and of the image. In 2005, the sales of the coffee machine Nespresso Essenza contribute to make of Nespresso the European leader of machines in ‘espresso’.Then in 2006, Nespresso does not hesitate to engage the actor George Cl ooney further to the choice made by the members of the club among a list of celebrities which they had subjected them. The use of this actor as media vector aims above all at consolidating the positioning of Nespresso as a sophisticated brand and up-market. Nespresso’s figures: World Turnover 2007: 1  034  600  000 milliards Number of stores: 160 Number of clients: 3, 6 millions Number of machines sold in the world: 1, 4 millionsNumber of capsules sold in the world: 2, 3 billions Market share 2007 of the espresso market: 26, 7 % 2. 0 MARKETING ANALYSIS 2. 1 MARKET TRENDS Coffee’s consumption Source: National Coffee Drinking trends study Coffee is the most popular beverage worldwide. In 2008, 17% of the adult population consumed this gourmet drink everyday, compared with 14% in 2007. What is more, positive health messages drove the consumption Espresso’s market (2008) Type| Market shares| Individual coffee pods/portioned coffee| 57%|Traditional| 19%| Filter combined| 12%| Automatic| 10%| Espresso without pump| 2%| As we can see, this market is essentially characterised by individual coffee pods’ sales. Types of most popular home espresso machines Espresso pump machine (Nespresso’s): automatic pump to create the perfect amount of water pressure (usually the most expensive) Lever or piston machine: manual or human powered pump to create the pressure it needs to make espresso. The quality of the coffee can vary, as it depends on human power.Steam powered machine: works by heating water and using steam power to create the pressure needed (usually the cheapest and often the worst quality) Moka pot espresso machine: works by boiling water in the bottom of the pot, creating steam and then forcing that steam through the coffee and into the top portion of the pot. Overall, trends are favourable concerning the espresso’s consumption. Thanks to positive messages about coffee and health, people are slowly changing their mind. The sector is developing well, creating opportunities.More and more people buy home espresso machines and this trend will certainly follow its growth. 2. 2. TARGET AND POSITIONING The target | Types| Characteristics| B to C| * Members of Nespresso Club * Prospects| * From 35 to 60 * AB| B to B| * Hotels & restaurants * Luxury retailers * Companies * Airline companies| * Sponsors et partnership with events organizers * Conference rooms * Welcome rooms * Hotels, restaurants and cafes * Airlines * SME * Big companies| Needs in B to C| Needs in B to B| To consume differently but in a better way * Need to be pleased and to dream * To search for new sensations * Innovative products * High quality products * To believe in key values of the company * To create a ceremonial atmosphere around the coffee’s tasting as if it was a high quality win * Recognition through the Nespresso Club * To access the best coffee of the actual market| * Innovative and up-market products => brand image * High quality products to offer to customers or associates * Value of exception emitted by the Nespresso brand * To give to the company or to the event a modern, innovative and dynamic image through an up-market brand * To offer a delightful moment * Recognition trough the Business coffee solution| Actually, Nespresso’s typical customer is either a person linked to the statue conveyed by the brand and attached to the quality of the service, or a hedonist attached to the quality of the product. Positioning Nespresso’s positioning is up-market, in terms of quality and service. The brand is the worldwide leader of the up-market coffee. Nespresso aims at profitability per unit and their return on investment rather than volumes. This is the reason why the brand targets a niche with high prices. 2. 3. ENVIRONMENT 2. . 1 PEST Analysis Key points| P| * The smoking ban: impact on coffee machines’ sales| E| * A luxurious machine for a high purchasing power| S| * Coffee c an be considered as a social habit| T| * Implementation of the latest new technologies| Politic The only interesting political aspect in this case is the smoking ban. Indeed, this law has created a change of atmosphere in all public premises where people were used to have a coffee. Several pubs and cafes have been affected. Some smokers have preferred to have their coffee at home and to make it taste as good as cafes’ ones, they invested in high quality coffee machines. EconomyCoffee’s market is characterised by very strong prices’ fluctuations. Like in every market, coffee’s price is regulated by the ratio between the quantity of coffee available and the amount of people who want to consume some (in fact, this amount represents the quantity coffee merchants need to buy). If the quantity of available coffee exceeds needs of coffee merchants, coffee’s price decreases. Conversely, if there isn’t enough coffee to satisfy demand, the price incre ases. In this way, this international prices’ instability may, at any time, increase or decrease volumes of supply or demand. But the world’s actual economic situation influences those fluctuations.Indeed, recession affects everyone and it is leading to new behaviours and new consumption strategies. Nowadays, coffee’s supply overtakes demand. However, people targeted by companies like Nespresso are usually wealthy. This is the reason why sells of ‘luxurious’ coffee machines have increased for a couple of years. Social According to market trends, coffee is the most popular beverage worldwide with over 400 billion cups consumed each year. It usually refers to social and family gatherings. Coffee is also associated with ‘white collar’ jobs and office workers. Nowadays, coffee breaks at work are considered as social habits as they are pleasant ways to chat and relax.However, young people and elderly people restrict coffee’s consumpti on. Indeed, young people usually prefer soft drinks and seniors care about their health. Technology Coffee’s market is characterised by high technologies. Each coffee merchant is looking for the latest technology in terms of capsules and coffee machines; 19 Bar pressure pump, automatic and programmable coffee quantity, capsule container, cup-warming side plates, electronic control of the level in the water tank are examples of inevitable new technologies found in modern coffee machines. However, most of these new products don’t correspond to actual environmental criteria. 2. 3. 2 SWOT Analysis ————————————————-STRENGTHS * Diversification: in parallel with its activities in the ‘home’ sector, Nespresso extended to ‘out-of-home’ segment (hotels, restaurants, cafes, aviation, SME) * Up- market positioning * Fame and brand image: high qu ality coffee perceived by the customer as a luxury product * Personalized marketing: Nespresso Clubs (luxurious shops which represent Nespresso’s universe) and website * Own capsules: avoid competition and reduce distribution costs * Constant innovation: to maintain its brand image, Nespresso deals with sector’s leaders such as Krups, Miele or Siemens * Growth higher than 30% per year * Knowledge: an exclusive accessories range of high quality * Experimented sales force| ————————————————- WEAKNESSES * Limited target: from 35 years old with a high purchasing power * Mono-use of the coffee machine * Ethic and practical issues concerning capsules * High competition with lower prices and good quality equipment * Limited distribution: only through the Internet, by phone or in Nespresso shops| ————————— ———————- THREATS * Competitors: numerous and strong * Capsules’ patent comes to an end in 2012: if competitors reduce capsules’ price, huge margins realized at the moment won’t endure anymore * Multi-use coffee machines: people like to have many options (hot chocolate, tea†¦) * Negative environmental image| ————————————————- OPPORTUNITIES * Development on American and Chinese markets * Opening of new shops * B to B * The young’s market| Thanks to its positioning, Nespresso’s sales increase a lot every year since the company’s creation. Indeed, Nespresso wants its coffee and its coffee machines to be considered as luxurious products. However, even if they’re meant to target a niche, more and more people buy those products. For example, during offers periods customers can a fford the simplest coffee machine for only ? 50.In fact, the company’s turnover is not based on machines sales (only 4%), they are more considered as a strategy. When Nespresso first set up, it offered free machines to companies. Once the customer has the coffee machine, he can only buy Nespresso’s capsules. On the one hand, this system represents the main strength of the company but on the other hand, it can be perceived as a weakness. Indeed, many people are not used to buy through the Internet for several different reasons and there aren’t enough shops. Moreover, Nespresso’s coffee is often too expensive for potential customers. But Nespresso has planned to open new shops all around the world in order to become more accessible.The Nespresso Club is a good way to add a luxurious value to products. It creates a privileged relationship with customers. What is more, the experimented sales force of the company will be able to open up new products, new coffe e machines and different kinds of coffees. 2. 4. COMMUNICATION ANALYSIS Direct marketing Through its whole communication, pleasure and quality is always at the heart of Nespresso’s strategy. Having a coffee isn’t an everyday act anymore; it became a real sensorial experience. To understand this deep experience proposed by the company, it is necessary to get first into a Nespresso shop. Indeed, this is where Nespresso’s communication starts.In the shop, everything’s meant to create an unforgettable atmosphere characterized by luxury, peace and sensual pleasure. A very nice and smart employee welcomes potential customers. They directly feel comfortable and are happy to follow him/her to discover products. In this environment, each coffee machine looks like the perfect last element that will complete the decoration of the potential customer’s kitchen or living room. Moreover, a large range of tasting implements is nicely presented: cups, glasses, teas poons, shakers, chocolates, sugars†¦ and of course coffee. A vast number of coloured capsules are exposed, and obviously it is possible to taste them.Once the coffee machine and capsules bought, customers become members of the Nespresso Club in the same way as Georges Clooney! Hoarding campaign Nespresso chose the American actor Georges Clooney to represent the brand. Through this choice, the company expresses the following message: drinking a Nespresso is kind of being like Georges; it means integrate the elite, access a higher rank. Advertisers use here an identification process: they push consumers to adopt some behaviour and some feelings from the person they would like to be. The aim of this campaign’s strategy is to impose Nespresso as a worldwide brand and to reinforce its icon statue.Georges Clooney is The man who best represents Nespresso’s values, as he is sophisticated, chic and charming. Georges, as the brand’s ambassador, gives some legitimacy and some leadership to Nespresso. Actually, this campaign is based on two types of purchasing motivations. Coffee refers to a simple life’s pleasure but a Nespresso aims to be considered as a kind of ‘magic’ desire. This delightful idea of having a Nespresso at home is a hedonist motivation. On the other hand, advertisers use the fact that having a coffee has become a social habit so having a Nespresso machine is a good way to ‘show off’, as it can represent an extern sign of success. This is the auto-expression motivation. Visual analysis The logoThe N of Nespresso is made of curves, which brings dynamism to the word. This shape and warm colours refer to the idea of a nice coffee and to relaxation. We can also imagine an allusion to Italy. There is a direct relationship with yin and yang: that remembers equilibrium. Yin is associated with moon, which represents the feminine part of nature. Yang is associated with sun and represents the masculine par t. The visual way Nespresso’s advertising is adapted to the European market. Indeed, the picture is meant to be red from the left to the right and from the top to the bottom. The lighting, the look and the hands position guide the audience to the slogan, then to the machine and to finish to the brand.The main colour used is black; it remembers coffee. Georges Clooney is at the centre, he directly catches the attention. There is a hand-play and a look-play. His eyes are creating a delicious moment of impatience. The composition is simple, there are few movements; Georges is acting as a figure of authority. Concerning the slogan ‘Nespresso: What else? ’, the italic typeface remembers the idea of quickness when making a Nespresso. What is more, this short question refers to seduction, still according to the brand’s up-market position. Press relations * Communication relating to events Nespresso always organises an event when a new product is launched.For exam ple, the brand organised a big show in December 2007 at ‘Bon Marche’, Paris, to promote 2 new coffees. Nespresso is also an active partner in gastronomic events, such as the Bacuse d’Or competition and the selection of the World’s 50 best restaurants. * Press reviews The press reviews’ selection is strategic. Nespresso is present in some magazines, some newspapers, and in specialised reviews of information, strategy and opinion leader. * Press Once again, the choice of magazines is strategic. Nespresso’s ads are published in some magazines like feminine up-market, travels, sciences, decoration, news and economy. Most of Nespresso’s ads are double-page. Nespresso Magazine The brand has its own magazine. It targets all the members of the Nespresso Club. The magazine is published three times a year and distributed in about ten European countries. The magazine’s main topics are coffee and lifestyles. It is a 64 pages magazine with n o more than 10 pages of ads for luxurious brands. * TV and Cinema In 2006, Nespresso started to broadcast TV spots of 10, 30 and 50 seconds. Thanks to Georges Clooney, this operation has been very successful. However, it is through its campaign destined to cinema that the brand caught all the attention (75% of memorisation against 15% for TV). 3. 0 COMPETITORS ANALYSISOn the market of percolators we attend an increase in the number of partnerships between household appliances manufacturers and big food groups: * Kraft foods et Braun  : TASSIMO * Nestle and leaders in the sector of espresso machines such as Krups: NESPRESSO * Philips and Sara Lee: SENSEO * Procter and Gamble, Black and Decker and Krups: HOME coffee * Kraft foods and Braun: TASSIMO 3. 1 TWO LEVELS OF COMPETITION Coffee market  offers a lot of segments: powdered coffee, instant coffee, coffee beans, capsules†¦Each kind of products offer variants: Classical coffee, decaffeinated coffee, Arabica coffee†¦ Do mestic electrical appliances market offers various products: coffee pots, espressos, percolators†¦ Concerting to capsules’ market, two kind of systems exist: * Closed proprietary systems: Nespresso, Tassimo, that is to say machines which only work with the brand’s capsules * Open Systems (easy serving espresso): De Longhi, all compatible brands. Coffee market:Monodor, Swiss also, which sold 500 millions of capsules in 2006 in the world (against 2, 3 billions for Nespresso). The same design, the same complexions, the same naming with Italian consonance and the same rates as those of Nespresso. The leader of Monodor, Eric Favre, is the inventor of the concept of capsule used by Nespresso. According to the last rumours, he would recently have signed a discreet agreement with Lavazza. Three times smaller with 227 million euros turnover and an annual growth of 10 %, Illy and its cafes-shops (since 2001) aim at the same clientele as at the Swiss roaster. We can sample t he coffee in cups there drawn by the biggest designers or make it some purchases of capsules.Hyper Espresso, the new Illy‘s machine already distributed in certain restaurants will be available for the general public via two new machines launched at the end of the year (approximately 250 and 390 euros). It will require only Illy plastic capsules. Selling price: 0, 39 euros each. Starbucks, leader of the retailing and the roasting of coffee with more than 10 000 stores distributed between North America, Latin America, Europe, the Middle East and peaceful region. Starbucks made 7, 8 billion dollars of turnover in 2006 and realized an annual growth of the sales of 20 %. The company launched in the United States compatible capsules with the system Tassimo (Kraft Foods), it also collaborates with the car manufacturer BMW and the manufacturer of coffee machines Saeco for the launch of a new machine in espresso, Sirena.Luigi Lavazza is an Italian active company in the coffee market. A t the world level, Lavazza distributes approximately 1, 8 billion drinks a year. This company operates in the sector of the espresso in capsule for more than 15 years with the systems ESE, Espresso Point and, since 2004, Lavazza BLUE (Best Lavazza Ultimate Espresso). Lavazza is present in 80 countries and acquired an international fame. Today the sector â€Å"Professionals† of Lavazza represents 50 million euros. Domestic electrical appliances market Philips Senseo  : Senseo is a coffee machine spring from an association between Philips and ‘Maison du Cafe’. The main asset of this coffee pot is its speed and simplicity of use.We do not use any ground coffee in bag, but capsules, don’t need to measure anymore, similar for the water, it is measured meadow following the number of cups which we wish. Furthermore, the taste remains considerable and the froth gives one plus to the coffee natural. Key Factors of Success: Speed of use, simplicity of use, design, taste. Philips cucina  : This second coffee-pot of Philips, is less popular than the Senseo. This is principally had to the fact that its use is totally different. No capsules, but ground coffee and filters. Less rapidity of use, but simplicity is always present. The principal asset of this machine is its design and its simplicity. Key Factors of Success: simplicity of use, design. De’longhi espresso  : Another different coffee pot.Here it is the same system of use that the previous one, but this coffeepot is more worn towards the quality and taste. Indeed, its main asset is the taste which it produces and its froth as well. Key Factors of Success: taste. Moulinex crystal, Moulinex cocoon  : These two machines are similar; this is the reason why they are examined together. Work as the philips cucina, with ground coffee and filters as well. Their major assets are design and simplicity. However, they are common to many coffee pots. Key Factors of Success: simplicity of u se, design. Tassimo: This is a machine which does at the same time filter coffee, espresso, cappuccino, chocolate and tea.Its capsule, called ‘T-disc’ and patented, is endowed with a bar code which allows to recognize the drink and to adapt the preparation. A single button orders the use of the machine. Key Factors of Success: Speed and simplicity of use, design, taste, quality and practicality. 3. 2 FIVE PORTER’S FORCES Competitors The main Nespresso’s competitors are: Compagnies  : Philips et Sara Lee  in 2002 Target  : general public Price  : 69â‚ ¬ Capsules: 0,13-0,19â‚ ¬ and compatible with the others percolators Main competitor, Senseo established itself as the leader of capsules. The technology is simple and cheap, so easy to access, confirmed by the sale volume. We notice a big increase in + 37. 5% for Nespresso, and + 30% for Philips Senseo.Senseo which is often directly criticised concerning the fact its offer is not a true coffee e spresso, for lack of sufficient pressure, has just reacted with a kit espresso (carries filters & capsules) being able to adapt it on the machines which already exist. Its positioning is very generalist in comparison with Nespresso which promotes a up market brand image and which aims a certain clientele. Nespresso insists also on the quality of its coffee as being an exception coffee, and does not skimp on the means to assure to its clientele the better services and advices. Kraft foods and Braun  : TASSIMO Target: all drinkers of hot drinks Price: 129,99â‚ ¬Capsules  : 0,22-0,28â‚ ¬ This is a machine which does at the same time filter coffee, espresso, cappuccino, chocolate and tea. Its capsule, called ‘T-disc’ and patented, is endowed with a bar code which allows to recognize the drink and to adapt the preparation. A single button orders the use of the machine. Since its launch in France in 2004 until at the end of 2006, more than two million systems of dri nks Tassimo were sold in seven countries. Kraft Foods awaits of its brand Tassimo, a turnover of 200 millions of dollars this year. The threat of substitutes: Tea and infusion are markets with ‘well being references’ contrary to the coffee. Each year, 2. millions of metric tons of tea are produced in the world and about 1,200 billion cup of tea are drunk per year, hence 36,000 per second, which corresponds to an average annual consumption of 600 grams per year and per person. Soluble and other coffee varieties: the coffee market in capsules would not represent in 2006 that 3% in volume and 7% in value of the total quantity of consummate coffee in the world. But, nowadays the coffee market increase where sales stagnate. The power of suppliers: About coffee: the coffee market is characterized by fluctuations rather frequent because of the fact that it is governed by the offer and the request, which influences the coffee prices.Example: In 2006, Starbucks had bought its gr ains about 36% above the course of the stock Market of New York. This American offensive constrained Nespresso to align itself. The Swiss business thus paid a premium of 33% in comparison with the average course of the stock Market. However, Nespresso has a partnership with a NGO working for durable farming. For the machines: Nespresso has partnerships with the machine builders. There are many brands in competition each other: Krups, Magimix, Siemens, Miele †¦That allows Nespresso to check easily the pressure of the suppliers. The power of customers: The customers have a strong pressure on the market because they have access to a diversified choice.However, for the systems owners, the pressure is inverted, indeed, once the machine bought, the customer can only to use the corresponding capsules. In addition, the stagnation of the consumption of coffee gives to the customer a certain influence on the sector. Potential entrants : * Procter & Gamble * Kraft foods et Braun * Philips et Sara Lee * Salton * Monodor * Illy * Starbucks * Lavazaa The threat of the potential entrants is quite strong all the more so it is the matter of big groups such as Procter & Gamble or Salton. Concerning to competitive force, the pressure is even more important as a consequence of the presence of many competitors on this sector. Competitive Rivarly:In this sector it is very pronounced as a consequence of the fact that there are several competitors which take strategies of growth and base themselves on the innovation technological of the products. The competitive pressure is strong considering to the variety of the products and the power of competitors. Some of them do not hesitate to produce open systems, that is to say, usable capsules with others machines. The market is attractive and does not really represent barriers to the entry, that’s a real potential. 3. 3 NESPRESSO COMPARED TO COMPETITORS MULTI-DRINKS CAPSULE VARIETY (COFFEE) MACHINES QUALITY (Power) ACCESSIBILIT Y CAPSULES PURCHASE POSITIONING (upmarket) COMPETITIVENESS MACHINES & CAPSULES PRICES BRANDS MATCHINGPRESENCE IN THE MARKET (Time) Nespresso Tassimo Senseo 4. 0 NESPRESSO’S STRATEGY Since its creation, Nespresso has experienced several policies and several strategies which were not always successful, until now. Indeed the current strategy of the company is a clever association of knowledge, creativity and innovation which transformed the firm in a real and particular concept. Nespresso is now one of the most known brands on the coffee market. 4. 1 CORPORATE STRATEGY 4. 1. 1 Differentiation Strategy To deeply understand the Nespresso’s corporate strategy, we based our reflection on the Generic Strategies analysis by M. Porter. | COMPETITIVE ADVANTAGE| Specific feature seen by the costumer| Low cost policy of the company| COMPETITVE SCOPE| Broad| DIFFERENTIATION| OVERALL COST LEADERSHIP| | Narrow| FOCUS/ NICHE STRATEGY| Analyzing the principal characteristics of Nespress o we can think that they use the Differentiation strategy. Indeed, the differentiation strategy implements other factors than the price in order to differentiate the product or service from the competitors. The Nespresso’s strategy is based on a high quality product and on a luxurious brand image. If you buy a Nespresso product you belong to the selective â€Å"Nespresso Club† which provides lots of personal advantages and personal status to the consumers who are ready to pay a high price.The company offers a perfect espresso for hedonist and elitist people who reflect a special way of life: the more than 30 year old urban people with a high purchase power. Nespresso use the differentiation through the top with a high price and value: The â€Å"Virtuous Circle† of the differentiation through the top: Characteristics| Risks| * Intuition and Creativity * Innovation * Business * Partner and cooperative distribution network * Good brand image| * Difficulties to mana ge the additional cost due to the differentiation * Wrong perception from the costumer * Imitation of the differentiation factor * Lose the interest of the differentiation factor from the costumer|We can easily link this model to the Nespresso concept: their creativity innovation and intuition are perceived by the rarity, the quality and the image of the range of capsules or machines they sell. It is perceived as well by the concept of â€Å"Club† and of belonging to a high community just drinking a delicious coffee which answers to their target using the esteem need of the Maslow’s hierarchy. Its distribution network is an entire part of its concept: luxurious places where consumers can join people sharing the same taste and feel the personal status Nespresso gives them. Concerning the brand image, Nespresso is now one of the most famous brands thanks to its clever communication and to the face of the company: George Clooney.At the moment Nespresso keeps its competiti ve advantage and is still a reference in the high quality market. Consequently the firm is still avoiding the risks linked to this strategy which is the main reason of its incredible success. If we follow the Strategy Clock of Bowman, we can explain why the differentiation strategy succeeds so much. Indeed, the perceived added value sufficient to bear a premium price. The target buys not only an espresso machine but the whole culture of Nespresso which give them the possibility to join an elitist community and reach particular privileges. 4. 1. 2 Internal Growth Strategy The internal growth strategy of Nespresso is clear: Penetrate and spread.The company currently wants to conquer new markets shares thanks to a strong marketing campaign at once â€Å"push†: cinema, television, billboards and â€Å"pull†: direct marketing, website, sponsoring, in order to become and stay the leader on the capsules coffee market. The firm established an internalization strategy. It has r ecently implemented some stores in the United States and in China. Nowadays, Nespresso is represented in more than 50 countries by 160 Nespresso boutiques in 2008. Two different kinds of internalization strategies are possible. The first one is the Multinational strategy: the organization’s activity is implemented in a new area and then modified according to the country’s specificities.Nespresso is developing the Global strategy: it proposes on the whole area it covers a standard offer. Nevertheless, the international development of the brand succeeds thanks to a good knowledge of the coffee consumption habits which is very different in each country. According to that, it adapts its strategy to each new market, privileging sometimes the loyalty aspect of the concept and sometimes to conquer new costumers. 4. 1. 3 External Growth Strategy An external growth strategy could be defined by a merger and acquisition process, by an assortment of companies or by a partnership o f different firms. Nespresso’s strategy is defined by the last one.Indeed, the firm established strategic alliances with some famous companies as SIEMENS or TURMIX (KRUPS) to develop some of their activities like coffee machines. According to the contracts those companies have to respect the Nespresso’s criteria manufacturing design, refined and luxurious items. Nespresso cooperates as well with the RAINFOREST ALLIANCE, one of the most important ONG supporting agriculture in order to create the NESPRESSO AAA program which certifies the quality of their product. The objective of this program is to produce a high quality Green coffee according to the economics and social consequences for the local producer and to the environment’s respect. 4. 2 ACTIVITIES’ STRATEGIES Nespresso SA is one of the most efficient strategic business units of the Nestle group.Therefore, despite the fact that the company owns several activities none is corresponding to a strategic business unit. Nevertheless, as we said the firm operates on different market segments thanks to 4 developed businesses: the sale of espresso machines, of coffee capsules, of accessories and the managing of many luxurious places around the world. In order to deeply understand the company strategy and to produce a complete study, we will present the different businesses Nespresso proposes and then its strategy applied for each of its market segment using those businesses. 4. 2. 1 Nespresso’s Businesses Presentation Espresso machines The espresso machines represent the main activity of the brand and generate the most important profit.The company has created 40 models according to the different needs of the target. The machines are manufactured by partner companies as Siemens, Miele, Alessi, Koenig, Turmix, De’ Longhi, Magimix and Krups. They differentiate themselves by a unique design and a luxurious aspect which perfectly reflect the Nespresso’s image. As an exam ple, the most famous machine is the MAGIMIX M110 sold for ? 116: New compact brewing unit technology, 19 bar pressure pump, thermoblock heating element, automatic and programmable coffee quantity and available in different colors: â€Å"What else†? Those machines represent a high technology inside a refined aesthetic.Concerning the distribution network, it is a traditional one: we can find some machines in hypermarkets, mail order or in specialized shops. More than 18  000 points of sale have been counted. Coffee capsules The Nespresso’s range of coffee capsules is composed of 9 different blends from the decaffeinated to the strongest one. The espresso blends come from the finest coffee-producing countries: Brazil, Columbia, Costa Rica, Togo, Guatemala, Kenya and Ethiopia. Capsules cost ? 0. 25 each and customers can only find it on the Nespresso official website or in Nespresso boutiques. According to Daniel Lalonde, International Commercial Director, 24 capsules ar e sold each second somewhere in the world. AccessoriesIn order to perfectly complete their offer, Nespresso sells to its consumers all the accessories which are necessary to make their coffee break a design and elegant moment. A wide range of coffee cups from ? 8. 81 to ? 44. 04 each, sugar bowls, chocolate, items to heat the milk, recipe glasses, candles, Shaker, cappuccino kit, spoons, trays and more. Under the words â€Å"Presentation is everything† Nespresso makes its consumers understand that they cannot drink such a delicious coffee without sophistication. The Nespresso Boutiques The Nespresso boutiques and bars boutiques are the heart of the Nespresso communication strategy. They are allowed only to â€Å"Club members† and are the showcase of the brand. Consumers belong to the club as soon as they buy their first machine.From this moment they are able to buy the capsules and the accessories and they benefit from a personal service for information or reclamations . Moreover they are able to enter the luxurious boutiques in order to taste new blends, buy some products or just enjoy their time in beautiful and refined spaces. Those boutiques generate about 25% of the company’s annual turnover in B to C. In order to create those elegant and design spaces the brand worked with the famous French architect Francis Krempp who realized the plan of the biggest boutiques. Each new boutique is strategically located in the most elegant and famous street of the biggest urban centers. We currently count about 160 boutiques and bars boutiques around the world. 4. 2. 2 Nespresso Markets SegmentThe company operates on two different markets segment, the Nespresso Business to Consumers division for customers or Club members and the Nespresso Business to Business division for the out-of-home sector. In a very competitive environment, the brand is positioned as leadership and as the only distributor and owner of aluminum capsules and particular machinesâ €™ patents. The Nespresso’s challenge is that in 2012 the capsules and machines’ patents will become public giving to the competitors the possibility to create machines with the same technology and the corresponding capsules. Therefore, in the following part we will analyze the strategies that the company is currently using in order to keep its position on the market. Nespresso applies different strategies for each market segment. 4. 2. 2. 1 Nespresso Business to ConsumerIn this section the target are the members of the Nespresso Club, the new costumers and the potential customers. Machines promotions and new customer strategy Nespresso aims to conquer new customers until 2012 proposing some promotions on machines at special occasions of the year. The brand wants to develop its consumer panel thanks to reductions for the new buyers, for the club members and for partnerships. The Partnership is the fact that a consumer â€Å"pushes† another person to buy a ma chine, and then the consumer gets a reduction. The club members are the best promotion support for Nespresso, indeed a consumer who talks about the brand to 10 people for example, gives it between 3 and 5 new potential customers.Moreover, once the customer buys his first machine, he becomes a member and therefore he has to buy the capsules and enter in the Nespresso’s database. Differentiation strategy The Coffee: In order to keep its dynamic image, Nespresso markets, once a year and in a period of two months, two new coffees from a small production: Spring limited edition, autumn club edition and variations. Those very high quality coffees are punctual and limited offers which goal is to make the customers come into the Nespresso boutiques. Those products are very rare and consequently, it does represent a differentiation because Nespresso is the only brand which proposes a different offer from the classic range. Finally the variations are another kind of limited editions: i t is a range of flavoured coffee.Machines: In order to differentiate itself from the competitors, the company created a â€Å"pack machine† which contains an instructions file, 12 capsules and some promotional leaflets on accessories. Accessories: As a luxury brand Nespresso has different season’s collections of accessories: The Autumn/Winter collection and a Spring/Summer collection. The firm is the only one which creates its own accessories on the coffee market. Loyalty strategy The main strategy of the company in B to C is the loyalty strategy based on an important loyalty program: * The â€Å"Welcome in Nespresso† concept * The website * The â€Å"Nespresso Club† * The mailing and emailing campaigns * The phoning campaign called â€Å"Nursing† Newsletter in the monthly Nespresso magazine The â€Å"Welcome in Nespresso† concept: This loyalty program integrates on one year long the new customers thanks to discovery boxes or promotions. Thi s strategy not only strengthens the Nespresso perception and its brand image it also allows it learning more about their consumers from the beginning, encourages members tasting different blends and buy accessories and generates important orders. The website www. nespresso. com: Useful loyalty tool, it generates about 37% of new members. Indeed the consumers can buy some items online and regularly check the new offers and promotions. The â€Å"Nespresso Club†: The main dvantage of this concept is to create a long term relationship with the consumer because he belongs to the brand club since his first purchase. He will regularly receive some mailings and emailing and therefore he will be in regular contact with Nespresso. Mailing and emailing When a new customer enters in the Nespresso’s database he often receives personalized mails about the club services, the accessories, machines and some satisfaction surveys. Nursing: Nespresso phones all new customers one month aft er their first order asking them about their opinion about the Grand Crus and the practicality of the machines. They also remind him the club services.Public relations: As we said previously, the Nespresso magazine is delivered only to the best consumers of the brand. It is mainly about coffee but also about different subjects about the luxury sector. It is considered like a privilege for those who receive it. 4. 2. 2. 2 Nespresso Business Coffee Solutions This division of the firm targets companies from different sector: Offices, hotels and restaurants, luxury retails (luxury shops, spas†¦) and airlines companies. The B to B prospecting strategy Prospecting: Nespreso is currently prospecting new business customers using tools as a trying brochure or telephone number in order to fix an appointment to try a machine.The objective of this strategy is in a first step to establish a contact with the potential business customer for a free try and in a second step to measure his poten tial and his needs. Try and contract: During the try session the aim is to introduce â€Å"Nespresso Professional†, inform the potential customer about the different products and services, create a first impression and engender the signature of the contract. Loyalty strategy: As the B to C loyalty strategy, the company that Nespresso is targeting will receive a welcoming pack, some phone calls (nursing) and a satisfaction survey. 4. 2. 2. 3 Market segments’ strategy conclusions On the whole we can say that the B to B division is now a mature segment where Nespresso mainly has to develop its relationships with its customers.Nevertheless, despite the fact that the B to C division is well developed and well positioned on the market, the company still has to conquer market shares and customers around the world. Indeed the machine selling is a very important part of the Nespresso’s profit and needs to be increased. CONCLUSIONS AND RECOMMENDATIONS Unique Personalized Service High Design Machines High Quality Coffee In conclusion, according to the market trends and the Nespresso’s sales, the company is on a successful way. Success which began with its resources, indeed Nespresso owns decisive intangible resources which are its several patents, its relationships with high technology industries and quality coffee producers around the world and finally, its brand image.They are completed by an inventive strategy management team: the firm’s main tangible resource. Those resources engender the Nespresso’s distinctive competencies: Ownership of high technology and design process, worldwide coffee supplying and an efficient differentiation strategy. The final result of the Nespresso’s competencies is the now famous trilogy of competitive advantages: That is how Nespresso became one of the most famous coffee brand and that despite high price products, sales exploded. The competition could be severe however each competitor has a different positioning which protects the company from directs competitors. All future consumers are conquered by the system and rapidly become a Nespresso Club member.About the future of the company, it recently conducted a democratization strategy targeting younger customers creating the Essenza and Compact ranges. The reason is probably because their target is getting older which could become risky in long term speaking. The expansion of Nespresso Boutiques confirms that theory, the company is trying to catch the attention of a larger population. As we said the firm has to develop its machines sales as much as possible and young people seems to be a perfect potential target. In order to reach this aim Nespresso should develop its range of affordable machines keeping a dynamic and innovative feature but giving to younger people the access to the brand. Nevertheless, they should not target people under 25 in order to keep their high quality brand image.Recently some competitors la unched new technologies able to produce not only coffee but hot chocolate and tea as well. It could be an interesting evolution for the company, still in a view of getting the target larger. Indeed the tea market is full of potential with an increasing demand. Moreover, to attract young people Nespresso could create a special range of machines with a trendier aesthetic, keeping its refined design with a touch of dynamism. As final recommendation, Nespresso should find an alternative to the aluminum capsules which are in contradiction with the environmentally friendly and natural image that Nespresso desires to have. Indeed aluminum is known as a very polluting material.

Linguistics and Chomsky S Theory Essay

Chomsky believes that children are born with an inherited ability to learn any of the human languages. He thinks that certain linguistic structures that children use so accurately, must have already stuck in their mind. Chomsky believes that every child has a ‘language acquisition device’ or LAD. LAD encodes the major principles of a language and its grammatical structures into the child’s brain. Then the children only have to learn new vocabulary and apply the syntactic structures form the LAD to form sentences. He pointed out that a child could not possibly learn a new language through imitation alone simply because the language spoken around them is of a higher form. Adult’s speech is often broken up and even sometime ungrammatical. His theory applies to all languages as they all contain; nouns, verbs, consonants and vowels. Every language is extremely complex, often with subtle distinctions which even native speakers are unaware of. However, all children, regardless of their intellectual ability, become fluent in their native language within five or six years. Evidence to support Chomsky’s theory †¢Children learning to speak never make grammatical errors such as getting their subjects, verbs and objects in the wrong order. †¢If an adult deliberately said a grammatically incorrect sentence, the child would notice. †¢Children often say things that are ungrammatical such as ‘mama ball’, which they cannot have learnt passively. †¢Mistakes such as ‘I drawed’ instead of ‘I drew’ show they are not learning through imitation alone. †¢Chomsky used the sentence ‘colourless green ideas sleep furiously’, which is grammatical although it doesn’t make sense, to prove his theory: he said it shows that sentences can be grammatical without having any meaning, that we can tell the difference between a grammatical and an ungrammatical sentence without ever having heard the sentence before, and that we can produce and understand brand new sentences that no one has ever said before. Evidence against Chomsky’s theory †¢Critics of Chomsky’s theory say that although it is clear that children don’t learn language through imitation alone, this does not prove that they must have an LAD – language learning could merely be through general learning and understanding abilities and interactions with other people.

Cost Accounting Answers

CHAPTER 4 JOB COSTING 4-1Cost pool––a grouping of individual indirect cost items. Cost tracing––the assigning of direct costs to the chosen cost object. Cost allocation––the assigning of indirect costs to the chosen cost object. Cost-allocation base––a factor that links in a systematic way an indirect cost or group of indirect costs to cost objects. 4-2In a job-costing system, costs are assigned to a distinct unit, batch, or lot of a product or service.In a process-costing system, the cost of a product or service is obtained by using broad averages to assign costs to masses of identical or similar units. 4-3An advertising campaign for Pepsi is likely to be very specific to that individual client. Job costing enables all the specific aspects of each job to be identified. In contrast, the processing of checking account withdrawals is similar for many customers. Here, process costing can be used to compute the cost of each checking account withdrawal. -4The seven steps in job costing are: (1) identify the job that is the chosen cost object, (2) identify the direct costs of the job, (3) select the cost-allocation bases to use for allocating indirect costs to the job, (4) identify the indirect costs associated with each cost-allocation base, (5) compute the rate per unit of each cost-allocation base used to allocate indirect costs to the job, (6) compute the indirect costs allocated to the job, and (7) compute the total cost of the job by adding all direct and indirect costs assigned to the job. -5Major cost objects that managers focus on in companies using job costing are a product such as a specialized machine, a service such as a repair job, a project such as running the Expo, or a task such as an advertising campaign. 4-6Three major source documents used in job-costing systems are (1) job cost ecord or job cost sheet, a document that records and accumulates all costs assigned to a specific job, starting whe n work begins (2) materials requisition record, a document that contains information about the cost of direct materials used on a specific job and in a specific department; and (3) labor-time sheet, a document that contains information about the amount of labor time used for a specific job in a specific department. -7The main advantages of using computerized source documents for job cost records are the accuracy of the records and the ability to provide managers with instantaneous feedback to help control job costs. 4-8Two reasons for using an annual budget period are a. The numerator reason––the longer the time period, the less the influence of seasonal patterns in overhead costs, and b. The denominator reason––the longer the time period, the less the effect of variations in output levels or quantities of the cost-allocation bases on the allocation of fixed costs. -9Actual costing and normal costing differ in their use of actual or budgeted indirect cost rates: | |Actual |Normal | | |Costing |Costing | |Direct-cost rates |Actual rates |Actual rates | |Indirect-cost rates |Actual rates |Budgeted rates |Each costing method uses the actual quantity of the direct-cost input and the actual quantity of the cost-allocation base. 4-10A house construction firm can use job cost information (a) to determine the profitability of individual jobs, (b) to assist in bidding on future jobs, and (c) to evaluate professionals who are in charge of managing individual jobs. 4-11The statement is false. In a normal costing system, the Manufacturing Overhead Control account will not, in general, equal the amounts in the Manufacturing Overhead Allocated account.The Manufacturing Overhead Control account aggregates the actual overhead costs incurred while Manufacturing Overhead Allocated allocates overhead costs to jobs on the basis of a budgeted rate times the actual quantity of the cost-allocation base. Underallocation or overallocation of indirect (overh ead) costs can arise because of (a) the Numerator reason––the actual overhead costs differ from the budgeted overhead costs, and (b) the Denominator reason––the actual quantity used of the allocation base differs from the budgeted quantity. 4-12Debit entries to Work-in-Process Control represent increases in work in process.Examples of debit entries under normal costing are (a) direct materials used (credit to Materials Control), (b) direct manufacturing labor billed to job (credit to Wages Payable Control), and (c) manufacturing overhead allocated to job (credit to Manufacturing Overhead Allocated). 4-13Alternative ways to make end-of-period adjustments to dispose of underallocated or overallocated overhead are as follows: (i)Proration based on the total amount of indirect costs allocated (before proration) in the ending balances of work in process, finished goods, and cost of goods sold. ii)Proration based on total ending balances (before proration) in w ork in process, finished goods, and cost of goods sold. iii) Year-end write-off to Cost of Goods Sold. iv) The adjusted allocation rate approach that restates all overhead entries using actual indirect cost rates rather than budgeted indirect cost rates. 4-14A company might use budgeted costs rather than actual costs to compute direct labor rates because it may be difficult to trace direct labor costs to jobs as they are completed (for example, because bonuses are only known at the end of the year). -15Modern technology of electronic data interchange (EDI) is helpful to managers because it ensures that a purchase order is transmitted quickly and accurately to suppliers with minimum paperwork and costs. 16. (10 min) Job order costing, process costing. a. Job costingl. Job costing b. Process costingm. Process costing c. Job costingn. Job costing d. Process costingo. Job costing e. Job costingp. Job costing f. Process costingq. Job costing g. Job costingr. Process costing h. Job costin g (but some process costing)s. Job costing i.Process costingt. Process costing j. Process costingu. Job costing k. Job costing 4-17(20 min. )Actual costing, normal costing, accounting for manufacturing overhead. 1. [pic]=[pic] =[pic]= 1. 80 or 180% [pic]=[pic] =[pic]= 1. 9 or 190% 2. Costs of Job 626 under actual and normal costing follow: ActualNormal CostingCosting Direct materials$ 40,000$ 40,000 Direct manufacturing labor costs30,00030,000 Manufacturing overhead costs $30,000 ( 1. 90; $30,000 ( 1. 80 57,000 54,000 Total manufacturing costs of Job 626$127,000$124,000 3. pic]=[pic] ( [pic] =$1,450,000 ( 1. 80 =$2,610,000 [pic]=[pic] – [pic] =$2,755,000 ( $2,610,000 = $145,000 There is no under- or overallocated overhead under actual costing because overhead is allocated under actual costing by multiplying actual manufacturing labor costs and the actual manufacturing overhead rate. This, of course equals the actual manufacturing overhead costs. All actual overhead costs are allocated to products. Hence, there is no under- or overallocated overhead. 4-18(20 -30 min. ) Job costing, normal and actual costing. 1. pic]=[pic] = [pic] =$50 per direct labor-hour [pic]=[pic] = [pic] =$40 per direct labor-hour These rates differ because both the numerator and the denominator in the two calculations are different—one based on budgeted numbers and the other based on actual numbers. |2a. |Laguna |Mission | | |Model |Model | | Normal costing | | | |Direct costs | | |Direct materials |$106,760 |$127,550 | |Direct labor |36,950 |41,320 | | |143,710 |168,870 | |Indirect costs | | | |Assembly support ($50 ( 960; $50 ( 1,050) |48,000 |52,500 | |Total costs |$191,710 |$221,370 | |2b.Actual costing | | | |Direct costs | | | |Direct materials |$106,760 |$127,550 | |Direct labor |36,950 |41,320 | | |143,710 |168,870 | |Indirect costs | | | |Assembly support ($40 ( 960; $40 ( 1,050) |38,400 |42,000 | |Total costs |$182,110 |$210,870 | 3. Normal costing enables Am esbury to report a job cost as soon as the job is completed, assuming that both the direct materials and direct labor costs are known at the time of use. Once the 960 direct labor-hours are known for the Laguna Model (June 2011), Amesbury can compute the $191,710 cost figure using normal costing. Amesbury can use this information to manage the costs of the Laguna Model job as well as to bid on similar jobs later in the year. In contrast, Amesbury has to wait until the December 2011 year-end to compute the $182,110 cost of the Laguna Model using actual costing.Although not required, the following overview diagram summarizes Amesbury Construction’s job-costing system. [pic] 4-19(10 min. )Budgeted manufacturing overhead rate, allocated manufacturing overhead. 1. Budgeted manufacturing overhead rate = [pic] = [pic] = $24 per machine-hour |2. |Manufacturing |= |Actual |( |Budgeted manufacturing | | |overhead | |machine-hours | |overhead rate | | |allocated | | | | | = 170,000 ? $2 4 = $4,080,000 3.Since manufacturing overhead allocated is greater than the actual manufacturing overhead costs, Gammaro overallocated manufacturing overhead: Manufacturing overhead allocated$4,080,000 Actual manufacturing overhead costs 4,050,000 Overallocated manufacturing overhead$ 30,000 4-20(20-30 min. )Job costing, accounting for manufacturing overhead, budgeted rates. 1. An overview of the product costing system is [pic] Budgeted manufacturing overhead divided by allocation base: Machining overhead:[pic] = $36 per machine-hour Assembly overhead:[pic] = 180% of direct manuf. labor costs 2. Machining department, 2,000 hours ( $36$72,000 Assembly department, 180% ( $15,000 27,000 Total manufacturing overhead allocated to Job 494$99,000 3.MachiningAssembly Actual manufacturing overhead$2,100,000$ 3,700,000 Manufacturing overhead allocated, $36 ( 55,000 machine-hours1,980,000— 180% ( $2,200,000 — 3,960,000 Underallocated (Overallocated)$ 120,000$ (260,000) 4-21 (20(2 5 min. ) Job costing, consulting firm. 1. Budgeted indirect-cost rate for client support can be calculated as follows: Budgeted indirect-cost rate = $13,600,000 ? $5,312,500 = 256% of professional labor costs 2. At the budgeted revenues of $21,250,000 Taylor’s operating income of $2,337,500 equals 11% of revenues. Markup rate = $21,250,000 ? $5,312,500 = 400% of direct professional labor costs 3. Budgeted costsDirect costs: Director, $198 ( 4$ 792 Partner, $101 ( 171,717 Associate, $49 ( 422,058 Assistant, $36 ( 153 5,508$10,075 Indirect costs: Consulting support, 256% ( $10,075 25,792 Total costs$35,867 As calculated in requirement 2, the bid price to earn an 11% income-to-revenue margin is 400% of direct professional costs. Therefore, Taylor should bid 4 ( $10,075 = $40,300 for the Red Rooster job. Bid price to earn target operating income-to-revenue margin of 11% can also be calculated as follows: Let R = revenue to earn target income R – 0. 11R = $35,867 0. 89R = $ 35,867 R = $35,867 ? 0. 89 = $40,300 Or Direct costs $10,075 Indirect costs 25,792Operating income (0. 11 ( $40,300) 4,433 Bid price$40,300 4-22(15–20 min. )Time period used to compute indirect cost rates. 1. | |Quarter | | |1 |2 |3 |4 |Annual | |(1) Pools sold |700 |500 |150 |150 |1,500 | |(2) Direct manufacturing labor hours (0. 5 ( |350 |250 |75 |75 |750 | Row 1) | | | | | | |(3) Fixed manufacturing overhead costs |$10,500 |$10,500 |$10,500 |$10,500 |$42,000 | |(4) Budgeted fixed manufacturing overhead |$30 |$42 |$140 |$140 |$56 | |rate per direct manufacturing labor hour | | | | | | |($10,500 ( Row 2) | | | | | | | |Budgeted Costs Based on Quarterly | | |Manufacturing Overhead Rate | | |2nd Quarter |3rd Quarter | |Direct material costs ($7. 0 ( 500 pools; 150 pools) |$ 3,750 |$ 1,125 | |Direct manufacturing labor costs |4,000 |1,200 | |($16 ( 250 hours; 75 hours) | | | |Variable manufacturing overhead costs |3,000 |900 | |($12 ( 250 hours; 75 hours) | | | |Fixed manufac turing overhead costs | 10,500 | 10,500 | |($42 ( 250 hours; $140 ? 5 hours) | | | |Total manufacturing costs |$21,250 |$13,725 | |Divided by pools manufactured each quarter | ? 500 | ? 150 | |Manufacturing cost per pool |$ 42. 50 |$ 91. 50 | 2. | |Budgeted Costs Based on Annual Manufacturing | | |Overhead Rate | | |2nd Quarter |3rd Quarter | |Direct material costs ($7. 0 ( 500 pools; 150 pools) |$ 3,750 |$1,125 | |Direct manufacturing labor costs |4,000 |1,200 | |($16 ( 250 hours; 75 hours) | | | |Variable manufacturing overhead costs |3,000 |900 | |($12 ( 250 hours; 75 hours) | | | |Fixed manufacturing overhead costs | 14,000 | 4,200 | |($56 ( 250 hours; 75 hours) | | | |Total manufacturing costs |$24,750 |$7,425 | |Divided by pools manufactured each quarter | ( 500 | ( 150 | |Manufacturing cost per pool |$ 49. 50 |$49. 50 | 3. | |2nd Quarter |3rd Quarter | |Prices based on quarterly budgeted manufacturing overhead rates calculated in |$55. 25 |$118. 5 | |requirement 1 | | | |($42. 50 ( 130%; $91. 50 ( 130%) | | | |Price based on annual budgeted manufacturing overhead rates calculated in |$64. 35 |$64. 35 | |requirement 2 | | | |($49. 50 ( 130%; $49. 50 ( 130%) | | |Splash should use the budgeted annual manufacturing overhead rate because capacity decisions are based on longer annual periods rather than quarterly periods. Prices should not vary based on quarterly fluctuations in production. Splash could vary prices based on market conditions and demand for its pools. In this case, Splash would charge higher prices in quarter 2 when demand for its pools is high. Pricing based on quarterly budgets would cause Splash to do the opposite—to decrease rather than increase prices! 4-23(10–15 min. ) Accounting for manufacturing overhead. 1. Budgeted manufacturing overhead rate= [pic] = $30 per machine-hour 2. Work-in-Process Control7,350,000 Manufacturing Overhead Allocated7,350,000 (245,000 machine-hours ( $30 per machine-hour = $7,350,000) 3. 7,350,000– $7,300,000 = $50,000 overallocated, an insignificant amount of actual manufacturing overhead costs $50,000 ? $7,300,000 = 0. 68%. Manufacturing Overhead Allocated7,350,000 Manufacturing Department Overhead Control7,300,000 Cost of Goods Sold50,000 4-24(35(45 min. ) Job costing, journal entries. Some instructors may also want to assign Exercise 4-25. It demonstrates the relationships of the general ledger to the underlying subsidiary ledgers and source documents. 1. An overview of the product costing system is: 2. & 3. This answer assumes COGS given of $4,020 does not include the writeoff of overallocated manufacturing overhead. |2. (1) Materials Control |800 | | | |Accounts Payable Control | |800 | | |(2) Work-in-Process Control |710 | | | |Materials Control | |710 | | |(3) Manufacturing Overhead Control |100 | | | |Materials Control | |100 | | |(4) Work-in-Process Control |1,300 | | | |Manufacturing Overhead Control |900 | | | |Wages Payable Control | |2,200 | | |(5) Manufacturing Overhead Control | 400 | | | |Accumulated Depreciation––buildings and | | | | |manufacturing equipment | |400 | | |(6) Manufacturing Overhead Control | 550 | | | |Miscellaneous accounts | |550 | | |(7) Work-in-Process Control |2,080 | | | |Manufacturing Overhead Allocated | |2,080 | | |(1. 60 ( $1,300 = $2,080) | | | | |(8) Finished Goods Control |4,120 | | | |Work-in-Process Control |4,120 | | |(9) Accounts Receivable Control (or Cash) |8,000 | | | |Revenues | |8,000 | | |(10) Cost of Goods Sold |4,020 | | | |Finished Goods Control | |4,020 | | |(11) Manufacturing Overhead Allocated |2,080 | | | |Manufacturing Overhead Control | |1,950 | | |Cost of Goods Sold | |130 | 3. |Materials Control | |Bal. /1/2011 |100 |(2) Work-in-Process Control (Materials used) | | |(1) Accounts Payable Control | |(3) Manufacturing Overhead Control (Materials |710 | |(Purchases) |800 |used) | | | | | |100 | |Bal. 12/31/2011 |90 | | | |Work-in-Process Control | |B al. /1/2011 |60 |(8) Finished Goods Control (Goods completed) | | |(2) Materials Control (Direct | | |4,120 | |materials) |710 | | | |(4) Wages Payable Control (Direct | | | | |manuf. labor) | | | | |(7) Manuf. Overhead Allocated |1,300 | | | | | | | | | |2,080 | | | |Bal. 2/31/2011 |30 | | | |Finished Goods Control | |Bal. 1/1/2011 |500 |(10) Cost of Goods Sold |4,020 | |(8) WIP Control | | | | |(Goods completed) |4,120 | | | |Bal. 12/31/2011 |600 | | | Cost of Goods Sold | |(10) Finished Goods Control (Goods | |(11) Manufacturing Overhead Allocated (Adjust | | |sold) |4,020 |for overallocation) | | | | | |130 | |Bal. 12/31/2011 |3,890 | | | |Manufacturing Overhead Control | | (3) Materials Control (Indirect materials)| |(11) To close |1,950 | |(4) Wages Payable Control (Indirect manuf. |100 | | | |labor) | | | | |(5) Accum. Deprn.Control (Depreciation) |900 | | | |(6) Accounts Payable Control | | | | |(Miscellaneous) |400 | | | | | | | | | |550 | | | |Bal. |0 | | | Manufacturing Overhead Allocated | |(11) To close |2,080 |(7) Work-in-Process Control (Manuf. overhead | | | | |allocated) |2,080 | | | |Bal. | 0 | 4-25(35 minutes) Journal entries, T-accounts, and source documents. 1. i. Direct Materials Control 124,000 Accounts Payable Control124,000 Source Document: Purchase Invoice, Receiving Report Subsidiary Ledger: Direct Materials Record, Accounts Payable ii. Work in Process Control a 122,000 Direct Materials Control122,000Source Document: Material Requisition Records, Job Cost Record Subsidiary Ledger: Direct Materials Record, Work-in-Process Inventory Records by Jobs iii. Work in Process Control80,000 Manufacturing Overhead Control54,500 Wages Payable Control134,500 Source Document: Labor Time Sheets, Job Cost Records Subsidiary Ledger:, Manufacturing Overhead Records, Employee Labor Records, Work-in-Process Inventory Records by Jobs iv. Manufacturing Overhead Control129,500 Salaries Payable Control 20,000 Accounts Payable Control 9,500 Accumulated Depreciation Control 30,000 Rent Payable Control 70,000 Source Document: Depreciation Schedule, Rent Schedule, Maintenance wages due, Invoices for miscellaneous factory overhead items Subsidiary Ledger: Manufacturing Overhead Records v.Work in Process Control200,000 Manufacturing Overhead Allocated200,000 ($80,000 [pic] $2. 50) Source Document: Labor Time Sheets, Job Cost Record Subsidiary Ledger: Work-in-Process Inventory Records by Jobs vi. Finished Goods Control b387,000 Work in Process Control387,000 Source Document: Job Cost Record, Completed Job Cost Record Subsidiary Ledger: Work-in-Process Inventory Records by Jobs, Finished Goods Inventory Records by Jobs vii. Cost of Goods Sold c432,000 Finished Goods Control432,000 Source Document: Sales Invoice, Completed Job Cost Record Subsidiary Ledger: Finished Goods Inventory Records by Jobs viii. Manufacturing Overhead Allocated200,000Manufacturing Overhead Control ($129,500 + $54,500)184,000 Cost of Goods Sold 16,000 Source Document: Prior Journal Entries ix. Administrative Expenses 7,000 Marketing Expenses120,000 Salaries Payable Control30,000 Accounts Payable Control90,000 Accumulated Depreciation, Office Equipment 7,000 Source Document: Depreciation Schedule, Marketing Payroll Request, Invoice for Advertising, Sales Commission Schedule. Subsidiary Ledger: Employee Salary Records, Administration Cost Records, Marketing Cost Records. aMaterials used = [pic] + Purchases – [pic] [pic] b[pic] = [pic] + [pic] – [pic] [pic] cCost of goods sold = [pic] + [pic] – [pic] [pic] 2. T-accounts Direct Materials Control | |Bal. 1/1/2011 |9,000 |(2) Work-in-Process Control (Materials used) | | |(1) Accounts Payable Control (Purchases) | | |122,000 | | |124,000 | | | |Bal. 12/31/2011 |11,000 | | | Work-in-Process Control | |Bal. 1/1/2011 |6,000 |(6) Finished Goods Control (Cost of goods | | |(2) Materials Control | |manufactured) | | |(Direct materials used) |122,000 | |387,000 | |(3) Wages Payable Control (Direct manuf. labor)| | | | |(5) Manuf.Overhead Allocated |80,000 | | | | | | | | | |200,000 | | | |Bal. 12/31/2011 |21,000 | | | |Finished Goods Control | |Bal. 1/1/2011 |69,000 |(7) Cost of Goods Sold |432,000 | |(6) WIP Control | | | | |(Cost of goods manuf. ) |387,000 | | | |Bal. 2/31/2011 |24,000 | | | |Cost of Goods Sold | |(7) Finished Goods Control (Goods sold) | |(8) Manufacturing Overhead Allocated (Adjust | | | |432,000 |for overallocation) | | | | | |16,000 | | | | | | Manufacturing Overhead Control | |(3) Wages Payable Control | |(8) To close |184,000 | |(Indirect manuf. labor) |54,500 | | | |(4) Salaries Payable Control (Maintenance) | | | | |(4) Accounts Payable Control (Miscellaneous) |20,000 | | | |(4) Accum. Deprn.Control (Depreciation) | | | | |(4) Rent Payable Control (Rent) |9,500 | | | | | | | | | |30,000 | | | | | | | | | |70,000 | | | |Bal. |0 | | | |Manufacturing Overhead Allocated | |(8) To close |200,000 |(5) Work-in-Process Contr ol (Manuf. verhead | | | | |allocated) | | | | | |200,000 | | | |Bal. | 0 | 4-26(45 min. )Job costing, journal entries. Some instructors may wish to assign Problem 4-24. It demonstrates the relationships of journal entries, general ledger, subsidiary ledgers, and source documents. 1. An overview of the product-costing system is 2. Amounts in millions. (1) Materials Control |150 | | |Accounts Payable Control | |150 | |(2) Work-in-Process Control |145 | | |Materials Control | |145 | |(3) Manufacturing Department Overhead Control | 10 | | |Materials Control | |10 | |(4) Work-in-Process Control | 90 | | |Wages Payable Control | |90 | |(5) Manufacturing Department Overhead Control | 30 | | |Wages Payable Control | |30 | |(6) Manufacturing Department Overhead Control | 19 | | |Accumulated Depreciation | |19 | |(7) Manufacturing Department Overhead Control | 9 | | |Various liabilities | |9 | |(8) Work-in-Process Control | 63 | | |Manufacturing Overhead Allocated | |63 | |(9) Finished Goods Control |294 | | |Work-in-Process Control | |294 | |(10a)Cost of Goods Sold |292 | | |Finished Goods Control | |292 | |(10b) Accounts Receivable Control (or Cash ) |400 | | |Revenues | |400 | The posting of entries to T-accounts is as follows: |Materials Control | |Work-in-Process Control | |Bal 12 |(2) 145 | |Bal. |(9) 294 | | | | |(2) 145 | | | | | |(4) 90 | | | | | |(8) 63 | | |(1) 150 |(3) 10 | | | | |Bal. 7 | | | | | | | | | | | | | | |Bal. | | |Finished Goods Control | |Cost of Goods Sold | |Bal. 6 |(10a) 292 | |(10a) 292 | | |(9) 294 | | |(11) 5 | | |Bal. 8 | | | | | |Manufacturing Department | | |Overhead Control | |Manufacturing Overhead Allocated | |(3) 10 |(11) 68 | |(11) 63 |(8) 63 | |(5) 30 | | | | | |(6) 19 | | | | | |(7) 9 | | | | | Accounts Payable Control | |Wages Payable Control | | |(1) 150 | | |(4) 90 | | | | | |(5) 30 | |Accumulated Depreciation | |Various Liabilities | | |(6) 19 | | |(7) 9 | Accounts Receivable Control | |Revenues | |(10b) 400 | | | | (10b) 400 | | | | | | | The ending balance of Work-in-Process Control is $6. 3. (11) Manufacturing Overhead Allocated63 Cost of Goods Sold5 Manufacturing Department Overhead Control68 Entry posted to T-accounts in Requirement 2. 4-27(15 min. )Job costing, unit cost, ending work in progress. 1. Direct manufacturing labor rate per hour |$26 |   | |Manufacturing overhead cost allocated |$20 |   | |per manufacturing labor-hour | | | |   |Job M1 |Job M2 | |Direct manufacturing labor costs |$273,000 |$208,000 | |Direct manufacturing labor hours ($273,000[pic]$26; | 10,500 | 8,000 | |$208,000[pic]$26) | | | |Manufacturing overhead cost allocated (10,500 [pic] $20; |$210,000 |$160,000 | |8,000 [pic] $20) | | | | | | | |Job Costs May 2011 |Job M1 |Job M2 | |Direct materials |$ 78,000 |$ 51,000 | |Direct manufacturing labor | 273,000 | 208,000 | |Manufacturing overhead allocated | 210,000 | 160,000 | |Total costs |$561,000 |$419,000 | 2. |Number of pipes produced for Job M1 |1,100 |   | |Cost per pipe ($561,000 [pic]1,100) |$510 |   | 3. Finished Goods Control561,000 Work-in-Process Control 561,000 4.Rafael Company began May 2011 with no work-in-process inventory. During May, it started and finished M1. It also started M2, which is still in work-in-process inventory at the end of May. M2’s manufacturing costs up to this point, $419,000, remain as a debit balance in the Work-in-Process Inventory account at the end of May 2011. 4-28(20(30 min. ) Job costing; actual, normal, and variation from normal costing. 1. Actual direct cost rate for professional labor=$59 per professional labor-hour Actual indirect cost rate = [pic]=$42 per professional labor-hour [pic] = [pic]=$55 per professional labor-hour Budgeted indirect cost rate = [pic]=$43 per professional labor-hour |(a) |(b) |(c) | | |Actual |Normal |Variation of | | |Costing |Costing |Normal Costing | |Direct-Cost Rate |$59 |$59 |$55 | | |(Actual rate) |(Actual rate) |(Budgeted rate) | |Indirect-Cost Ra te |$42 |$43 |$43 | | |(Actual rate) |(Budgeted rate) |(Budgeted rate) | |2. |(a) |(b) |(c) | | Actual |Normal |Variation of | | |Costing |Costing |Normal Costing | |Direct Costs |$59 ( 160 = $ 9,440 |$59 ( 160 = $ 9,440 |$55 ( 160 = $ 8,800 | |Indirect Costs |$42 ( 160 = 6,720 |$43 ( 160 = 6,880 |$43 ( 160 = 6,880 | |Total Job Costs |$16,160 |$16,320 |$15,680 | All three costing systems use the actual professional labor time of 160 hours. The budgeted 150 hours for the Pierre Enterprises audit job is not used in job costing. However, Chico may have used the 150 hour number in bidding for the audit. The actual costing figure of $16,160 is less than the normal costing figure of $16,320 because the actual indirect-cost rate ($42) is less than the budgeted indirect-cost rate ($43).The normal costing figure of $16,320 is more than the variation of normal costing (based on budgeted rates for direct costs) figure of $15,680, because the actual direct-cost rate ($59) is more than the budge ted direct-cost rate ($55). Although not required, the following overview diagram summarizes Chico’s job-costing system. [pic] 4-29(20(30 min. ) Job costing; actual, normal, and variation from normal costing. 1. Actual direct cost rate for architectural labor=$92 per architectural labor-hour Actual indirect cost rate = [pic]=$50 per architectural labor-hour [pic] = [pic]=$90 per architectural labor-hour Budgeted indirect cost rate = [pic]=$54 per architectural labor-hour |(a) |(b) |(c) | | |Actual |Normal |Variation of | | |Costing |Costing |Normal Costing | |Direct-Cost Rate |$92 |$92 |$90 | | |(Actual rate) |(Actual rate) |(Budgeted rate) | |Indirect-Cost Rate |$50 |$54 |$54 | | |(Actual rate) |(Budgeted rate) |(Budgeted rate) | |2. (a) |(b) |(c) | | |Actual |Normal |Variation of | | |Costing |Costing |Normal Costing | |Direct Costs |$92 ( 250 = $23,000 |$92 ( 250 = $23,000 |$90 ( 250 = $22,500 | |Indirect Costs |$50 ( 250 = 12,500 |$54 ( 250 = 13,500 |$54 ( 250 = 13,500 | |Total Job Costs |$35,500 |$36,500 |$36,000 | All three costing systems use the actual architectural labor time of 250 hours. The budgeted 275 hours for the Champ Tower job is not used in job costing. However, Braden Brothers may have used the budgeted number of hours in bidding for the job. 30. (30 min. ) Proration of overhead. [pic] = [pic] [pic] 2. Overhead allocated = 50% [pic] Actual direct manufacturing labor cost = 50% [pic] $228,000 = $114,000 |Underallocated |= |Actual |– |Allocated plant | | | |manufacturing | |manufacturing | |overhead costs | | | |overhead | |overhead costs | | | | = $117,000 – $114,000 = $3,000 Underallocated manufacturing overhead = $3,000 3a. All underallocated manufacturing overhead is written off to cost of goods sold. Both work in process (WIP) and finished goods inventory remain unchanged. |Account |Dec. 31, 2011 |Proration of $3,000 |Dec. 31, 2011 | | |Balance |Underallocated |Balance | | |(Before Proration) |Manuf.Overhead |(After Proration) | | |(1) |(2) |(3) = (1) + (2) | |WIP |$ 50,700 |$ 0 |$ 50,700 | |Finished Goods |245,050 |0 |245,050 | |Cost of Goods Sold | 549,250 | 3,000 | 552,250 | |Total |$845,000 |$3,000 |$848,000 | 3b. Underallocated manufacturing overhead prorated based on ending balances: |Account |Dec. 31, 2011 Account |Account |Proration of $3,000 |Dec. 1, 2011 Account | | |Balance |Balance as a |Underallocated |Balance | | |(Before Proration) |Percent of Total |Manuf. Overhead |(After Proration) | | |(1) |(2) = (1) ? $845,000 |(3) = (2)[pic]$3,000 |(4) = (1) + (3) | |WIP |$ 50,700 |0. 06 |0. 06 [pic] $3,000 = $ 180 |$ 50,880 | |Finished Goods |245,050 |0. 29 |0. 29 [pic] $3,000 = 870 |245,920 | |Cost of Goods Sold | 549,250 |0. 65 |0. 5 [pic] $3,000 = 1,950 | 551,200 | |Total |$845,000 |1. 00 |$3,000 |$848,000 | 3c. Underallocated manufacturing overhead prorated based on 2011 overhead in ending balances: |Account |Dec. 31, 2011 |Allocated Manuf. |Allocated Manuf. Overhead |Proration of $3,0 00 |Dec. 31, 2011 | | |Account |Overhead in |in |Underallocated |Account | | |Balance |Dec. 31, 2011 Balance |Dec. 31, 2011 |Manuf.Overhead |Balance | | |(Before Proration) |(Before Proration) |Balance as a |(4) = (3)[pic]$3,000 |(After Proration) | | |(1) |(2) |Percent of Total | |(5) = (1) + (4) | | | | |(3) = (2) ? $114,000 | | | |WIP |$ 50,700 |$ 10,260a |0. 09 |0. 09 [pic] $3,000 = $ 270 |$ 50,970 | |Finished Goods |245,050 |29,640b |0. 26 |0. 6 [pic] $3,000 = 780 |245,830 | |Cost of Goods Sold | 549,250 | 74,100c |0. 65 |0. 65 [pic] $3,000 = 1,950 | 551,200 | |Total | $845,000 |$114,000 |1. 00 | $3,000 | $848,000 | a,b,c Overhead allocated = Direct manuf. labor cost[pic]50% = $20,520; $59,280; $148,200[pic]50% 4. Writing off all of the underallocated manufacturing overhead to Cost of Goods Sold (CGS) is usually warranted when CGS is large relative to Work-in-Process and Finished Goods Inventory and the underallocated manufacturing overhead is immaterial. Both these conditions apply in this case.ROW should write off the $3,000 underallocated manufacturing overhead to Cost of Goods Sold Account. 4-31 (20(30 min)Job costing, accounting for manufacturing overhead, budgeted rates. 1. An overview of the job-costing system is: [pic] 2. Budgeted manufacturing overhead divided by allocation base: a. Machining Department: [pic]= $52 per machine-hour b. Finishing Department: [pic]= 194% of direct manufacturing labor costs 3. Machining Department overhead, $52 ( 130 machine-hours$6,760 Finishing Department overhead, 194% of $1,100 2,134 Total manufacturing overhead allocated$8,894 4. Total costs of Job 431: Direct costs: Direct materials––Machining Department$15,500 ––Finishing Department5,000Direct manufacturing labor—Machining Department400 —Finishing Department 1,100$22,000 Indirect costs: Machining Department overhead, $52 ( 130$ 6,760 Finishing Department overhead, 194% of $1,100 2,134 8,894 Total costs$30,894 The per-u nit product cost of Job 431 is $30,894 ? 400 units = $77. 235 per unit The point of this part is (a) to get the definitions straight and (b) to underscore that overhead is allocated by multiplying the actual amount of the allocation base by the budgeted rate. 5. MachiningFinishing Manufacturing overhead incurred (actual)$11,070,000$8,236,000 Manufacturing overhead allocated 210,000 hours ( $5210,920,000 94% of $4,400,000 8,536,000 Underallocated manufacturing overhead$ 150,000 Overallocated manufacturing overhead$ 300,000 Total overallocated overhead = $300,000 – $150,000 = $150,000 6. A homogeneous cost pool is one where all costs have the same or a similar cause-and-effect or benefits-received relationship with the cost-allocation base. Fasano likely assumes that all its manufacturing overhead cost items are not homogeneous. Specifically, those in the Machining Department have a cause-and-effect relationship with machine-hours, while those in the Finishing Department have a cause-and-effect relationship with direct manufacturing labor costs.Fasano believes that the benefits of using two cost pools (more accurate product costs and better ability to manage costs) exceeds the costs of implementing a more complex system. 4-32(15(20 min. ) Service industry, job costing, law firm. 1. [pic] 2. [pic]= [pic] =[pic] =$65 per professional labor-hour Note that the budgeted professional labor-hour direct-cost rate can also be calculated by dividing total budgeted professional labor costs of $2,600,000 ($104,000 per professional ( 25 professionals) by total budgeted professional labor-hours of 40,000 (1,600 hours per professional ( 25 professionals), $2,600,000 ( 40,000 = $65 per professional labor-hour. [pic][pic]= [pic] [pic] =[pic] =$55 per professional labor-hour |4. |Richardson |Punch | |Direct costs: | | | |Professional labor, $65 ( 100; $65 ( 150 |$ 6,500 |$ 9,750 | |Indirect costs: | | | |Legal support, $55 ( 100; $55 ( 150 |5,500 |8,250 | | |$12,000 |$18, 000 | 4-33(25–30 min. Service industry, job costing, two direct- and indirect-cost categories, law firm (continuation of 4-32). Although not required, the following overview diagram is helpful to understand Keating’s job-costing system. [pic] |1. |Professional |Professional | | |Partner Labor |Associate Labor | |Budgeted compensation per professional |$ 200,000 |$80,000 | |Divided by budgeted hours of billable | | | |time per professional |? 1,600 |? ,600 | |Budgeted direct-cost rate |$125 per hour* |$50 per hour†  | *Can also be calculated as [pic]= [pic]= [pic]=$125 † Can also be calculated as [pic]= [pic]= [pic]=$ 50 |2. |General |Secretarial | | |Support |Support | |Budgeted total costs |$1,800,000 |$400,000 | |Divided by budgeted quantity of allocation base |? 40,000 hours |? ,000 hours | |Budgeted indirect cost rate |$45 per hour |$50 per hour | |3. |Richardson |Punch | |Direct costs: | | | |Professional partners, | | | |$125 ( 60 hr. ; $125 ( 30 hr. |$7,500 |$3,750 | |Professional associates, | | | |$50 ( 40 hr. ; $50 ( 120 hr. 2,000 |6,000 | |Direct costs |$ 9,500 |$ 9,750 | |Indirect costs: | | | |General support, | | | |$45 ( 100 hr. ; $45 ( 150 hr. |4,500 |6,750 | |Secretarial support, | | | |$50 ( 60 hr. ; $50 ( 30 hr. 3,000 |1,500 | |Indirect costs |7,500 |8,250 | |Total costs |$17,000 |$18,000 | |4. |Richardson |Punch | |Single direct – Single indirect | | | |(from Problem 4-32) |$12,000 |$18,000 |Multiple direct – Multiple indirect | | | |(from requirement 3 of Problem 4-33) |17,000 |18,000 | |Difference |$ 5,000 |$ 0 | | |undercosted |no change | The Richardson and Punch jobs differ in their use of resources. The Richardson job has a mix of 60% partners and 40% associates, while Punch has a mix of 20% partners and 80% associates. Thus, the Richardson job is a relatively high user of the more costly partner-related resources (both direct partner costs and indirect partner secretarial support). The Pun ch job, on the other hand, has a mix of partner and associate-related hours (1  :  4) that exactly equals the mix of partner and associate hours for the firm as a whole. The refined-costing system in Problem 4-33 increases the reported cost in Problem 4-32 for the Richardson job by 41. % (from $12,000 to $17,000) while it happens to correctly cost the Punch job. 4-34(20(25 min. ) Proration of overhead. [pic] 2. [pic]=[pic] – [pic] =$4,900,000 – $4,500,000* =$400,000 *$60 ( 75,000 actual machine-hours = $4,500,000 a. Write-off to Cost of Goods Sold | |Dec. 31, 2011 |Write-off |Dec. 31, 2011 | | |Account |of $400,000 |Account | | |Balance |Underallocated |Balance | |Account |(Before Proration) |Manufacturing (After Proration) | |(1) |(2) |Overhead |(4) = (2) + (3) | | | |(3) | | | | | | | |Work in Process |$ 750,000 |$ 0 |$ 750,000 | |Finished Goods |1,250,000 |0 |1,250,000 | |Cost of Goods Sold |8,000,000 |400,000 |8,400,000

Alcohol Abuse Introduction

Alcoholism and Alcohol Abuse Signs, Symptoms, and Help for Drinking Problems It’s not always easy to see when your drinking has crossed the line from moderate or social use to problem drinking. But if you consume alcohol to cope with difficulties or to avoid feeling bad, you’re in potentially dangerous territory. Alcoholism and alcohol abuse can sneak up on you, so it’s important to be aware of the warning signs and take steps to cut back if you recognize them. Understanding the problem is the first step to overcoming it. In This Article: * Understanding drinking problems * Signs & symptoms of alcohol abuse Signs & symptoms of alcoholism * Drinking problems and denial * Effects of alcoholism * Getting help for alcohol abuse * When a loved one has a drinking problem Understanding alcoholism and alcohol abuse Alcoholism and alcohol abuse are due to many interconnected factors, including genetics, how you were raised, your social environment, and your emotional heal th. Some racial groups, such as American Indians and Native Alaskans, are more at risk than others of developing alcohol addiction. People who have a family history of alcoholism or who associate closely with heavy drinkers are more likely to develop drinking problems.Finally, those who suffer from a mental health problem such as anxiety, depression, or bipolar disorder are also particularly at risk, because alcohol may be used to self-medicate. Since drinking is so common in many cultures and the effects vary so widely from person to person, it’s not always easy to figure out where the line is between social drinking and problem drinking. The bottom line is how alcohol affects you. If your drinking is causing problems in your life, you have a drinking problem. Do you have a drinking problem? You may have a drinking problem if you†¦ Feel guilty or ashamed about your drinking. * Lie to others or hide your drinking habits. * Have friends or family members who are worried a bout your drinking. * Need to drink in order to relax or feel better. * â€Å"Black out† or forget what you did while you were drinking. * Regularly drink more than you intended to. Signs and symptoms of alcohol abuse Substance abuse experts make a distinction between alcohol abuse and alcoholism (also called alcohol dependence). Unlike alcoholics, alcohol abusers have some ability to set limits on their drinking.However, their alcohol use is still self-destructive and dangerous to themselves or others. Common signs and symptoms of alcohol abuse include: * Repeatedly neglecting your responsibilities at home, work, or school because of your drinking. For example, performing poorly at work, flunking classes, neglecting your kids, or skipping out on commitments because you’re hung over. * Using alcohol in situations where it’s physically dangerous, such as drinking and driving, operating machinery while intoxicated, or mixing alcohol with prescription medication ag ainst doctor’s orders. Experiencing repeated legal problems on account of your drinking. For example, getting arrested for driving under the influence or for drunk and disorderly conduct. * Continuing to drink even though your alcohol use is causing problems in your relationships. Getting drunk with your buddies, for example, even though you know your wife will be very upset, or fighting with your family because they dislike how you act when you drink. * Drinking as a way to relax or de-stress. Many drinking problems start when people use alcohol to self-soothe and relieve stress.Getting drunk after every stressful day, for example, or reaching for a bottle every time you have an argument with your spouse or boss. The path from alcohol abuse to alcoholism Not all alcohol abusers become full-blown alcoholics, but it is a big risk factor. Sometimes alcoholism develops suddenly in response to a stressful change, such as a breakup, retirement, or another loss. Other times, it gra dually creeps up on you as your tolerance to alcohol increases. If you’re a binge drinker or you drink every day, the risks of developing alcoholism are greater. Signs and symptoms of alcoholism (alcohol dependence)Alcoholism is the most severe form of problem drinking. Alcoholism involves all the symptoms of alcohol abuse, but it also involves another element: physical dependence on alcohol. If you rely on alcohol to function or feel physically compelled to drink, you’re an alcoholic. Tolerance: The 1st major warning sign of alcoholism Do you have to drink a lot more than you used to in order to get buzzed or to feel relaxed? Can you drink more than other people without getting drunk? These are signs of tolerance, which can be an early warning sign of alcoholism. Tolerance means that, over time, you need more and more alcohol to feel the same effects.Withdrawal: The 2nd major warning sign of alcoholism Do you need a drink to steady the shakes in the morning? Drinking to relieve or avoid withdrawal symptoms is a sign of alcoholism and a huge red flag. When you drink heavily, your body gets used to the alcohol and experiences withdrawal symptoms if it’s taken away. These include: * Anxiety or jumpiness * Shakiness or trembling * Sweating * Nausea and vomiting * Insomnia | * Depression * Irritability * Fatigue * Loss of appetite * Headache | In severe cases, withdrawal from alcohol can also involve hallucinations, confusion, seizures, fever, and agitation.These symptoms can be dangerous, so talk to your doctor if you are a heavy drinker and want to quit. Other signs and symptoms of alcoholism (alcohol dependence) * You’ve lost control over your drinking. You often drink more alcohol than you wanted to, for longer than you intended, or despite telling yourself you wouldn’t. * You want to quit drinking, but you can’t. You have a persistent desire to cut down or stop your alcohol use, but your efforts to quit have been unsu ccessful. * You have given up other activities because of alcohol.You’re spending less time on activities that used to be important to you (hanging out with family and friends, going to the gym, pursuing your hobbies) because of your alcohol use. * Alcohol takes up a great deal of your energy and focus. You spend a lot of time drinking, thinking about it, or recovering from its effects. You have few if any interests or social involvements that don’t revolve around drinking. * You drink even though you know it’s causing problems. For example, you recognize that your alcohol use is damaging your marriage, making your depression worse, or causing health problems, but you continue to drink anyway.Drinking problems and denial Is my drinking a problem? by Harvard Health Publications Denial is one of the biggest obstacles to getting help for alcohol abuse and alcoholism. The desire to drink is so strong that the mind finds many ways to rationalize drinking, even when t he consequences are obvious. By keeping you from looking honestly at your behavior and its negative effects, denial also exacerbates alcohol-related problems with work, finances, and relationships. If you have a drinking problem, you may deny it by: * Drastically underestimating how much you drink Downplaying the negative consequences of your drinking * Complaining that family and friends are exaggerating the problem * Blaming your drinking or drinking-related problems on others For example, you may blame an ‘unfair boss’ for trouble at work or a ‘nagging wife’ for your marital issues, rather than look at how your drinking is contributing to the problem. While work, relationship, and financial stresses happen to everyone, an overall pattern of deterioration and blaming others may be a sign of trouble.If you find yourself rationalizing your drinking habits, lying about them, or refusing to discuss the subject, take a moment to consider why you’re so d efensive. If you truly believe you don’t have a problem, there should be no reason for you to cover up your drinking or make excuses. Five myths about alcoholism and alcohol abuse Myth #1: I can stop drinking anytime I want to. Maybe you can; more likely, you can’t. Either way, it’s just an excuse to keep drinking. The truth is, you don’t want to stop.Telling yourself you can quit makes you feel in control, despite all evidence to the contrary and no matter the damage it’s doing. Myth #2: My drinking is my problem. I’m the one it hurts, so no one has the right to tell me to stop. It’s true that the decision to quit drinking is up to you. But you are deceiving yourself if you think that your drinking hurts no one else but you. Alcoholism affects everyone around you—especially the people closest to you. Your problem is their problem. Myth #3: I don’t drink every day, so I can’t be an alcoholic OR I only drink wine o r beer, so I can’t be an alcoholic.Alcoholism is NOT defined by what you drink, when you drink it, or even how much you drink. It’s the EFFECTS of your drinking that define a problem. If your drinking is causing problems in your home or work life, you have a drinking problem—whether you drink daily or only on the weekends, down shots of tequila or stick to wine, drink three bottles of beers a day or three bottles of whiskey. Myth #4: I’m not an alcoholic because I have a job and I’m doing okay. You don’t have to be homeless and drinking out of a brown paper bag to be an alcoholic.Many alcoholics are able to hold down jobs, get through school, and provide for their families. Some are even able to excel. But just because you’re a high-functioning alcoholic doesn’t mean you’re not putting yourself or others in danger. Over time, the effects will catch up with you. Myth #5: Drinking is not a â€Å"real† addiction like drug abuse. Alcohol is a drug, and alcoholism is every bit as damaging as drug addiction. Alcohol addiction causes changes in the body and brain, and long-term alcohol abuse can have devastating effects on your health, your career, and your relationships.Alcoholics go through physical withdrawal when they stop drinking, just like drug users do when they quit. Effects of alcoholism and alcohol abuse Alcoholism and alcohol abuse can affect all aspects of your life. Long-term alcohol use can cause serious health complications, affecting virtually every organ in your body, including your brain. Problem drinking can also damage your emotional stability, finances, career, and your ability to build and sustain satisfying relationships. Alcoholism and alcohol abuse can also have an impact on your family, friends and the people you work with.The effects of alcoholism and alcohol abuse on the people you love Despite the potentially lethal damage that heavy drinking does to the body—in cluding cancer, heart problems, and liver disease—the social consequences can be just as devastating. Alcoholics and alcohol abusers are much more likely to get divorced, have problems with domestic violence, struggle with unemployment, and live in poverty. But even if you’re able to succeed at work or hold your marriage together, you can’t escape the effects that alcoholism and alcohol abuse has on your personal relationships.Drinking problems put an enormous strain on the people closest to you. Often, family members and close friends feel obligated to cover for the person with the drinking problem. So they take on the burden of cleaning up your messes, lying for you, or working more to make ends meet. Pretending that nothing is wrong and hiding away all of their fears and resentments can take an enormous toll. Children are especially sensitive and can suffer long-lasting emotional trauma when a parent or caretaker is an alcoholic or heavy drinker. Getting help for alcoholism or alcohol abuseIf you’re ready to admit you have a drinking problem, you’ve already taken the first step. It takes tremendous strength and courage to face alcohol abuse and alcoholism head on. Reaching out for support is the second step. Whether you choose to go to rehab, rely on self-help programs, get therapy, or take a self-directed treatment approach, support is essential. Recovering from alcohol addiction is much easier when you have people you can lean on for encouragement, comfort, and guidance. Without support, it’s easy to fall back into old patterns when things get tough.Getting sober is only the beginning Learn about roadblocks to staying sober Watch 3 min. video: Roadblocks to awareness Your continued recovery depends on continuing mental health treatment, learning healthier coping strategies, and making better decisions when dealing with life’s challenges. In order to stay alcohol-free for the long term, you’ll also ha ve to face the underlying problems that led to your alcoholism or alcohol abuse in the first place. Those problems could be depression, an inability to manage stress, an unresolved trauma from your childhood, or any number of mental health issues.Such problems may become more prominent when you’re no longer using alcohol to cover them up. But you will be in a healthier position to finally address them and seek the help you need. Helping a loved one with alcoholism or alcohol abuse If someone you love has a drinking problem, you may be struggling with a number of painful emotions, including shame, fear, anger, and self-blame. The problem may be so overwhelming that it seems easier to ignore it and pretend that nothing is wrong. But in the long run denying it will be more damaging to you, other family members, and the person with the drinking problem.What Not To Do * Don't attempt to punish, threaten, bribe, or preach. * Don't try to be a martyr. Avoid emotional appeals that ma y only increase feelings of guilt and the compulsion to drink or use other drugs. * Don't cover up or make excuses for the alcoholic or problem drinker or shield them from the realistic consequences of their behavior. * Don't take over their responsibilities, leaving them with no sense of importance or dignity. * Don't hide or dump bottles, throw out drugs, or shelter them from situations where alcohol is present. * Don't argue with the person when they are impaired. Don't try to drink along with the problem drinker. * Above all, don't feel guilty or responsible for another's behavior. Adapted from: National Clearinghouse for Alcohol ; Drug Information Dealing with a loved one’s alcohol problem can be an emotional rollercoaster. It’s vital that you take care of yourself and get the support you need. It’s also important to have people you can talk honestly and openly with about what you’re going through. A good place to start is by joining a group such as Al-Anon, a free peer support group for families coping with alcoholism.Listening to others with the same challenges can be a tremendous source of comfort and support. You can also turn to trusted friends, a therapist, or people in your faith community. * You cannot force someone you love to stop abusing alcohol. As much as you may want to, and as hard as it is to watch, you cannot make someone stop drinking. The choice is up to them. * Don’t expect the person to stop drinking and stay sober without help. Your loved one will need treatment, support, and new coping skills to overcome a serious drinking problem. * Recovery is n ongoing process. Recovery is a bumpy road, requiring time and patience. An alcoholic will not magically become a different person once sober. And the problems that led to the alcohol abuse in the first place will have to be faced. Admitting that there’s a serious problem can be painful for the whole family, not just the alcohol abuser. But don†™t be ashamed. You’re not alone. Alcoholism and alcohol abuse affects millions of families, from every social class, race, and culture. But there is help and support available for both you and your loved one.What Not To Do * Don't attempt to punish, threaten, bribe, or preach. * Don't try to be a martyr. Avoid emotional appeals that may only increase feelings of guilt and the compulsion to drink or use other drugs. * Don't cover up or make excuses for the alcoholic or problem drinker or shield them from the realistic consequences of their behavior. * Don't take over their responsibilities, leaving them with no sense of importance or dignity. * Don't hide or dump bottles, throw out drugs, or shelter them from situations where alcohol is present. Don't argue with the person when they are impaired. * Don't try to drink along with the problem drinker. * Above all, don't feel guilty or responsible for another's behavior. Adapted from: National Clearinghouse for Alcohol & Drug In formation When your teen has a drinking problem Discovering your child is drinking can generate fear, confusion, and anger in parents. It’s important to remain calm when confronting your teen, and only do so when everyone is sober. Explain your concerns and make it clear that your concern comes from a place of love.It’s important that your teen feels you are supportive. Five steps parents can take: 1. Lay down rules and consequences: Your teen should understand that drinking alcohol comes with specific consequences. But don’t make hollow threats or set rules that you cannot enforce. Make sure your spouse agrees with the rules and is prepared to enforce them. 2. Monitor your teen’s activity: Know where your teen goes and who he or she hangs out with. Remove or lock away alcohol from your home and routinely check potential hiding laces for alcohol—in backpacks, under the bed, between clothes in a drawer, for example. Explain to your teen that this la ck of privacy is a consequence of him or her having been caught using alcohol. 3. Encourage other interests and social activities. Expose your teen to healthy hobbies and activities, such as team sports, Scouts, and afterschool clubs. 4. Talk to your child about underlying issues. Drinking can be the result of other problems. Is your child having trouble fitting in? Has there been a recent major change, like a move or divorce, which is causing stress? . Get outside help: You don’t have to go it alone. Teenagers often rebel against their parents but if they hear the same information from a different authority figure, they may be more inclined to listen. Try seeking help from a sports coach, family doctor, therapist, or counselor. Next step†¦ Find the right treatment for you. Many effective alcohol treatment options are available, including rehab programs. However, professional help isn’t the only way to get better. There are also plenty of things you can do to help yourself stop drinking and achieve lasting recovery.

Cancer

Cancer My friend Matt was diagnosed with cancer in May 2002. When Matt 's girlfriend, Amber told me he had cancer, I was shocked when Matt was only 23 years old when he was diagnosed. The type of cancer that mat suffers is called leukemia, or white blood cell cancer. This cancer occurs in the bone marrow, but it may spread to blood, lymph nodes, spleen, liver, central nervous system, and other organs afterwards. Cancer is affected by many people every year, including grandmothers with cancer, and is now one of my close friends. First of all, what does cancer mean? Cancer is not sick. There are various types of cancer, all of which are different. For example, there are common cancers such as breast cancer, colorectal cancer, prostate cancer, skin cancer, pancreatic cancer, liver cancer and the like. There are various kinds of leukemia and blood cancer such as lymphoma. They are different, but there are also some common features. I would like to discuss these common functions. It is li ke talking about professional sports. You can say that football, football, hockey, fencing, and baseball are all different, but in general they all can be thought of together. Despite all the differences, all of this involves some kind of competition and physical skills. Likewise, cancer has many things in common. One of the most cited articles in oncology (cancer research) is the classical Weinberg paper detailing the eight general features. I will explain in detail later. In 2000, cancer biologists Robert Weinberg and Douglas Hanahan announced an article titled The Mark of Cancer. Although they are aware that cancer occurs through a series of mutations occurring in any of a number of genes. Nonetheless, they point to six fundamental changes in cellular physiology of malignant features. According to the American Cancer Society, about 11.4 million Americans had cancer history in 2010. In the United States, the death of one in four people is due to cancer. The mortality rate of males in 2010 was 229.9 people per 100,000 people and the mortality rate of women was 157.8 persons per 100,000 people. The incidence of males is 556.5 persons per 100,000 people, and the incidence of females is 414.8 people per 100,000 people. In the United States, lung cancer is the most common cause of cancer deaths by men and women. (Source: American Cancer Society) As mentioned earlier, most cancers are not affected. The mortality rate of cancer continues to rise. We know that there are many gene mutations in cancer. There is no doubt that the genomic map of cancer proves this. The problem is that you can not find a mutation. There are even different mutations in the same cancer. Despite investing a lot of time, money, and intellectual investment in this new genetic paradigm, we do not see the corresponding benefits. Genetic defects are not the ultimate cause of cancer - they are still only mid-stage and close causes. What we need to know is the reason for causing these mutations. Cancer Recently, cancer incidence in the world has risen. It is currently one of the top ten causes of death in middle-income countries around the world (World Health Organization, 2008). In Singapore, cancer surpasses cardiovascular disease and is the largest death in the past three years (Ministry of Health, 2007). Breast cancer is ranked top of women in Singapore (Health Promotion Council, 2007). Every year thousands of women are diagnosed with breast cancer and about 270 people die each year (Jara - Lazaro et al., 2010). First of all, what does cancer mean? Cancer is not sick. There are various types of cancer, all of which are different. For example, there are common cancers such as breast cancer, colorectal cancer, prostate cancer, skin cancer, pancreatic cancer, liver cancer and the like. There are various kinds of leukemia and blood cancer such as lymphoma. They are different, but there are also some common features. I would like to discuss these common functions. It is like talking about professional sports. You can say that football, football, hockey, fencing, and baseball are all different, but in general they all can be thought of together. Despite all the differences, all of this involves some kind of competition and physical skills. Likewise, cancer has many things in common. One of the most cited articles in oncology (cancer research) is the classical Weinberg paper detailing the eight general features. I will explain in detail later. In 2000, cancer biologists Robert Weinberg and Douglas Hanahan announced an article titled The Mark of Cancer. Although they are aware that cancer occurs through a series of mutations occurring in any of a number of genes. Nonetheless, they point to six fundamental changes in cellular physiology of malignant features. According to the American Cancer Society, about 11.4 million Americans had cancer history in 2010. In the United States, the death of one in four people is due to cancer. The mortality rate of males in 2010 w as 229.9 people per 100,000 people and the mortality rate of women was 157.8 persons per 100,000 people. The incidence of males is 556.5 persons per 100,000 people, and the incidence of females is 414.8 people per 100,000 people. In the United States, lung cancer is the most common cause of cancer deaths by men and women. (Source: American Cancer Society) Cancer Cancer Introduction In the American community, cancer is the most common disease for most people in the United States. Cancer is well known throughout history. In the early 1990s nearly 6 million cancer cases have been reported every year around the world, more than 4 million people have died. The most fatal cancer in the world is lung cancer, which has grown rapidly since the spread of smoking in the country. Stomach cancer is the second major form of cancer in men following lung cancer. First of all, what does cancer mean? Cancer is not sick. There are various types of cancer, all of which are different. For example, there are common cancers such as breast cancer, colorectal cancer, prostate cancer, skin cancer, pancreatic cancer, liver cancer and the like. There are various kinds of leukemia and blood cancer such as lymphoma. They are different, but there are also some common features. I would like to discuss these common functions. It is like talking about professional sports. Yo u can say that football, football, hockey, fencing, and baseball are all different, but in general they all can be thought of together. Despite all the differences, all of this involves some kind of competition and physical skills. Likewise, cancer has many things in common. One of the most cited articles in oncology (cancer research) is the classical Weinberg paper detailing the eight general features. I will explain in detail later. In 2000, cancer biologists Robert Weinberg and Douglas Hanahan announced an article titled The Mark of Cancer. Although they are aware that cancer occurs through a series of mutations occurring in any of a number of genes. Nonetheless, they point to six fundamental changes in cellular physiology of malignant features. According to the American Cancer Society, about 11.4 million Americans had cancer history in 2010. In the United States, the death of one in four people is due to cancer. The mortality rate of males in 2010 was 229.9 people per 100,000 pe ople and the mortality rate of women was 157.8 persons per 100,000 people. The incidence of males is 556.5 persons per 100,000 people, and the incidence of females is 414.8 people per 100,000 people. In the United States, lung cancer is the most common cause of cancer deaths by men and women. (Source: American Cancer Society) Cancer Cancer My friend Matt was diagnosed with cancer in May 2002. When Matt 's girlfriend, Amber told me he had cancer, I was shocked when Matt was only 23 years old when he was diagnosed. The type of cancer that mat suffers is called leukemia, or white blood cell cancer. This cancer occurs in the bone marrow, but it may spread to blood, lymph nodes, spleen, liver, central nervous system, and other organs afterwards. Cancer is affected by many people every year, including grandmothers with cancer, and is now one of my close friends. First of all, what does cancer mean? Cancer is not sick. There are various types of cancer, all of which are different. For example, there are common cancers such as breast cancer, colorectal cancer, prostate cancer, skin cancer, pancreatic cancer, liver cancer and the like. There are various kinds of leukemia and blood cancer such as lymphoma. They are different, but there are also some common features. I would like to discuss these common functions. It is li ke talking about professional sports. You can say that football, football, hockey, fencing, and baseball are all different, but in general they all can be thought of together. Despite all the differences, all of this involves some kind of competition and physical skills. Likewise, cancer has many things in common. One of the most cited articles in oncology (cancer research) is the classical Weinberg paper detailing the eight general features. I will explain in detail later. In 2000, cancer biologists Robert Weinberg and Douglas Hanahan announced an article titled The Mark of Cancer. Although they are aware that cancer occurs through a series of mutations occurring in any of a number of genes. Nonetheless, they point to six fundamental changes in cellular physiology of malignant features. According to the American Cancer Society, about 11.4 million Americans had cancer history in 2010. In the United States, the death of one in four people is due to cancer. The mortality rate of males in 2010 was 229.9 people per 100,000 people and the mortality rate of women was 157.8 persons per 100,000 people. The incidence of males is 556.5 persons per 100,000 people, and the incidence of females is 414.8 people per 100,000 people. In the United States, lung cancer is the most common cause of cancer deaths by men and women. (Source: American Cancer Society) As mentioned earlier, most cancers are not affected. The mortality rate of cancer continues to rise. We know that there are many gene mutations in cancer. There is no doubt that the genomic map of cancer proves this. The problem is that you can not find a mutation. There are even different mutations in the same cancer. Despite investing a lot of time, money, and intellectual investment in this new genetic paradigm, we do not see the corresponding benefits. Genetic defects are not the ultimate cause of cancer - they are still only mid-stage and close causes. What we need to know is the reason for causing these mutations. Cancer Cancer Introduction In the American community, cancer is the most common disease for most people in the United States. Cancer is well known throughout history. In the early 1990s nearly 6 million cancer cases have been reported every year around the world, more than 4 million people have died. The most fatal cancer in the world is lung cancer, which has grown rapidly since the spread of smoking in the country. Stomach cancer is the second major form of cancer in men following lung cancer. First of all, what does cancer mean? Cancer is not sick. There are various types of cancer, all of which are different. For example, there are common cancers such as breast cancer, colorectal cancer, prostate cancer, skin cancer, pancreatic cancer, liver cancer and the like. There are various kinds of leukemia and blood cancer such as lymphoma. They are different, but there are also some common features. I would like to discuss these common functions. It is like talking about professional sports. Yo u can say that football, football, hockey, fencing, and baseball are all different, but in general they all can be thought of together. Despite all the differences, all of this involves some kind of competition and physical skills. Likewise, cancer has many things in common. One of the most cited articles in oncology (cancer research) is the classical Weinberg paper detailing the eight general features. I will explain in detail later. In 2000, cancer biologists Robert Weinberg and Douglas Hanahan announced an article titled The Mark of Cancer. Although they are aware that cancer occurs through a series of mutations occurring in any of a number of genes. Nonetheless, they point to six fundamental changes in cellular physiology of malignant features. According to the American Cancer Society, about 11.4 million Americans had cancer history in 2010. In the United States, the death of one in four people is due to cancer. The mortality rate of males in 2010 was 229.9 people per 100,000 pe ople and the mortality rate of women was 157.8 persons per 100,000 people. The incidence of males is 556.5 persons per 100,000 people, and the incidence of females is 414.8 people per 100,000 people. In the United States, lung cancer is the most common cause of cancer deaths by men and women. (Source: American Cancer Society) Cancer Cancer Introduction In the American community, cancer is the most common disease for most people in the United States. Cancer is well known throughout history. In the early 1990s nearly 6 million cancer cases have been reported every year around the world, more than 4 million people have died. The most fatal cancer in the world is lung cancer, which has grown rapidly since the spread of smoking in the country. Stomach cancer is the second major form of cancer in men following lung cancer. First of all, what does cancer mean? Cancer is not sick. There are various types of cancer, all of which are different. For example, there are common cancers such as breast cancer, colorectal cancer, prostate cancer, skin cancer, pancreatic cancer, liver cancer and the like. There are various kinds of leukemia and blood cancer such as lymphoma. They are different, but there are also some common features. I would like to discuss these common functions. It is like talking about professional sports. Yo u can say that football, football, hockey, fencing, and baseball are all different, but in general they all can be thought of together. Despite all the differences, all of this involves some kind of competition and physical skills. Likewise, cancer has many things in common. One of the most cited articles in oncology (cancer research) is the classical Weinberg paper detailing the eight general features. I will explain in detail later. In 2000, cancer biologists Robert Weinberg and Douglas Hanahan announced an article titled The Mark of Cancer. Although they are aware that cancer occurs through a series of mutations occurring in any of a number of genes. Nonetheless, they point to six fundamental changes in cellular physiology of malignant features. According to the American Cancer Society, about 11.4 million Americans had cancer history in 2010. In the United States, the death of one in four people is due to cancer. The mortality rate of males in 2010 was 229.9 people per 100,000 pe ople and the mortality rate of women was 157.8 persons per 100,000 people. The incidence of males is 556.5 persons per 100,000 people, and the incidence of females is 414.8 people per 100,000 people. In the United States, lung cancer is the most common cause of cancer deaths by men and women. (Source: American Cancer Society) Cancer Cancer Introduction In the American community, cancer is the most common disease for most people in the United States. Cancer is well known throughout history. In the early 1990s nearly 6 million cancer cases have been reported every year around the world, more than 4 million people have died. The most fatal cancer in the world is lung cancer, which has grown rapidly since the spread of smoking in the country. Stomach cancer is the second major form of cancer in men following lung cancer. First of all, what does cancer mean? Cancer is not sick. There are various types of cancer, all of which are different. For example, there are common cancers such as breast cancer, colorectal cancer, prostate cancer, skin cancer, pancreatic cancer, liver cancer and the like. There are various kinds of leukemia and blood cancer such as lymphoma. They are different, but there are also some common features. I would like to discuss these common functions. It is like talking about professional sports. Yo u can say that football, football, hockey, fencing, and baseball are all different, but in general they all can be thought of together. Despite all the differences, all of this involves some kind of competition and physical skills. Likewise, cancer has many things in common. One of the most cited articles in oncology (cancer research) is the classical Weinberg paper detailing the eight general features. I will explain in detail later. In 2000, cancer biologists Robert Weinberg and Douglas Hanahan announced an article titled The Mark of Cancer. Although they are aware that cancer occurs through a series of mutations occurring in any of a number of genes. Nonetheless, they point to six fundamental changes in cellular physiology of malignant features. According to the American Cancer Society, about 11.4 million Americans had cancer history in 2010. In the United States, the death of one in four people is due to cancer. The mortality rate of males in 2010 was 229.9 people per 100,000 pe ople and the mortality rate of women was 157.8 persons per 100,000 people. The incidence of males is 556.5 persons per 100,000 people, and the incidence of females is 414.8 people per 100,000 people. In the United States, lung cancer is the most common cause of cancer deaths by men and women. (Source: American Cancer Society)

Beneficence and non-maleficence Essay Example | Topics and Well Written Essays - 250 words

Beneficence and non-maleficence - Essay Example This essay discusses that beneficence as a bioethics principle states that medical practitioners should be of help to patients seeking their service. Beneficent activities are conducted to eliminate any health problems. The principle stresses on the eminence of healthcare offered to patients. Practitioners should accurately diagnose the condition and then apply the adequate treatment. The principle follows the essence of healthcare that is offering health benefits to all. Sick persons enter into a relationship with practitioners in seeking health benefits since health practitioners have an obligation to assist. An example of a beneficent action is advising a lung cancer patient to stop smoking so as to reduce lung infection. This paper illustrates that non-maleficent is a principle that prohibits medical practitioners from causing any harm to the patients. Possible harms are as a result of medical errors. Despite the fact that treatment errors may be unintentional, deliberate situati ons are also evident. The paper tells that practitioners are supposed to undertake deliberate actions in ensuring that errors of omission and commission are avoided and that the patients can trust the health care service. In essence, practitioners should not make negligent steps that compromise the health outcomes of patients. A case of a non-maleficent act is to stop treatment that has dire effects on the patient's health or is uncertified as a safe treatment.

Al Qaeda Research Paper Example | Topics and Well Written Essays - 750 words

Al Qaeda - Research Paper Example Under these criteria are the 5 levels of anti-US sentiments, and 5 capability indicators. These are built into an analytical framework which consists of 3 parts. The 1st is the scale of intent and capability relationship. Second is the qualitative description of the scale of intent and capability. Third are the 10 levels of thresholds within intent and capability. Using the 'Indicators of Terrorist Group Intentions' in the evaluation of the manual retrieved by law enforcement officers in a suspected Al-Qaeda apartment in the United Kingdom the table below shows: Al Qaeda is a highly capable group and has demonstrated any anti-U.S. sentiment. Al Qaeda would be categorized as a "2." The 2 value was assigned because the manual states the members of the organization will be accompanied by the other members of the country for that operation. Al Qaeda also targets building especially with in line with the economics. Their operations were local and international because of their access in the communication process which was stated in the manual. Al Qaeda was categorized also as a "4." The 4 value was assigned because the manual states the building constructions, choice of exact locations for the target and headquarter for the operation, and etc. Using the 'Indicators of Terrorist Group Capabilities' in the eva... Capabilities in a Changing World; Publisher: RAND (Cragin and Daly, 2004) Using the 'Indicators of Terrorist Group Intentions' in the evaluation of the manual retrieved by law enforcement officers in a suspected Al-Qaeda apartment in the United Kingdom the table below shows: Threshold of Anti-U.S. Sentiment for the Al-Qaeda manual Numerical Value Association with another terror group that seeks to target U.S. citizens and Institutions 2 Targeting U.S. citizens and/or property to pursue a local agenda 4 Al Qaeda is a highly capable group and has demonstrated any anti-U.S. sentiment. Al Qaeda would be categorized as a "2." The 2 value was assigned because the manual states the members of the organization will be accompanied by the other members of the country for that operation. Al Qaeda also targets building especially with in line with the economics. Their operations were local and international because of their access in the communication process which was stated in the manual.Al Qaeda was categorized also as a "4." The 4 value was assigned because the manual states the building constructions, choice of exact locations for the target and headquarter for the operation, and etc. Using the 'Indicators of Terrorist Group Capabilities' in the evaluation of the manual retrieved by law enforcement officers in a suspected Al-Qaeda apartment in the United Kingdom, the table below show: Thresholds of Demonstrated and Perceived Attack Skills Numerical Value Successfully coordinate multiple attacks 5 Al Qaeda was categorized as a "5." The 5 indicator of terrorist group capability was assigned because the manual states the formal line up of all the perfect operation for every instance. The commander to members of the