Case Scenario: Brant Freezer Company
Q1. When comparing performance during the first five months of 2017 with performance in 2016, which warehouse shows the most improvement?
Q2. When comparing performance during the first five months of 2017 with performance in 2016, which warehouse shows the poorest change in performance?
Q3. When comparisons are made among all eight warehouses, which one do you think does the best job for the Brant Company? What criteria did you use? Why?
Q4. J. Q. is aggressive and is going to recommend that his father cancel the contract with one of the warehouses and give that business to a competing warehouse in the same city. J. Q. feels that when word of this gets around, the other warehouses they use will "shape up." Which of the seven should J. Q. recommend be dropped? Why?
Q5. The year 2017 is nearly half over. J. Q. is told to determine how much the firm is likely to spend for warehousing at each of the eight warehouses for the last six months in 2017. Do his work for him.
Q6. When comparing the 2016 figures with the 2017 figures shown in the table, the amount budgeted for each warehouse in 2017 was greater than actual 2016 costs. How much of the increase is caused by increased volume of business (units shipped) and how much by inflation?
Q7. Use the 2016 Income Statement and Balance Sheet to complete a Strategic Profit Model for J. Q.
Q8. Holding all other information constant, what would be the affect on ROA for 2017 if warehousing costs declined 10% from 2016 levels?