Historically When You Looked Up The Definition Of Marriage

Historically when you looked up the definition of marriage in the dictionary, it defined marriage as a union between a man and a woman. According to cbn.com, Merriam-Webster changed its definition of marriage in 2003. The revised version now defines marriage as the state of being married as spouses in a consensual and contractual relationship recognized by law. Currently, in 2017 more sources have also made revisions to redefine marriage. They are now defining marriage as being between two people instead of being between just a man and a woman. For decades, same-sex couples have been deprived of the same rights that opposite couples have always had. The case of Obergefell v Hodges made a huge impact in the U.S. and have changed the†¦show more content†¦The state of Michigan, then and still prohibits joint, legal adoptions from same-sex couples. Legally, they both could not be parents to their kids. This also means that if the legal parent or one of the children dies, their spouse will not receive custody of their child. Contrary to Deboer and Rowse’s case, other plaintiffs in Obergefell v. Hodges married in states where same-sex marriage is legal. However, when they relocated to other states where same same-sex marriage was not legal, their marriages were not recognized, and banned. One of the plaintiffs U.S. Army First Class Ijpe Dekoe stated that it was â€Å"particularly painful,† because â€Å"he is denied the very freedom, liberty, and equality that he risked his life to protect,† according to www.scotusblog.com. These plaintiffs and others with similar cases sued state officials in Kentucky, Ohio, Michigan, and Tennessee for violating their rights under the Fourteenth Amendment. Once the lawsuit was filed the district courts found for the plaintiffs in each occurrence, however the state officials filed an appealed for the Sixth Circuit to the United States Court of Appeals. The Court of Appeals combined the cases and ruled out under the constitution that states did not have to license or welcome same sex marriage. The plaintiffs responded by petitioning the United States Supreme Court for certiorari, and it was granted. On April 28, 2015, oral arguments in all four cases under the ObergefellShow MoreRelatedIs The Nuclear Family Means?1617 Words   |  7 PagesWhat is considered the nuclear family? Everyone in society has their own definition of what the nuclear family means to them and raises an interesting question as to which definition is said to be true? Society has constructed their own set of beliefs and terms in their way of living that the nuclear family can literally mean, and be constructed by almost anything. Depending on people situations, thei r built up version of what a family means to them can consists of uncles, aunts, grandparents, andRead MoreAnalyzing And Evaluation Modern Biographies About El Cid1606 Words   |  7 PagesModern biographies are often looked at by others as a reputable source of information when it comes to their subject of interest being hundreds of years old. Maybe it is because people today tend to believe whatever they are told or perhaps they see the title â€Å"Dr.† or â€Å" professor† pop up on the screen and put all of their trust in whatever that person is saying. However, that’s exactly the problem, whoever is holding the title of Dr. or professor is as equal a person like you or me, and sometimes we forgetRead MoreSocial Deviance and Social Norms Essay911 Words   |  4 PagesSocial deviance is a violation of social norms. So what qualifies as a social deviant? According to sociologist, Howard S. Becker the best definition of social deviance is, â€Å"It is not th e act itself, but the reactions to the act, that do something deviant.† In cultures around the world, there are many practices Americans find deviant, but in other cultures, it’s the norm. In many countries around the world, girls are married as young as 11 years old. To Americans, that is considered child abuse andRead MoreWhy Are Black American Men Against Homosexuality?1313 Words   |  6 PagesHomosexuality is often looked down upon and is a reoccurring topic in the black community and specifically with black American men. This sparks the question â€Å"Why are many Black American men against homosexuality?† Religion, the influence of hip-hop and the social construct of hyper-masculinity are all factors that play into the stigmatization of homosexuality. The element of worship has always been an essential part of the Black American culture. Black Americans â€Å"are markedly more religious on aRead MoreOthello is Not a Tragic Hero Essay1481 Words   |  6 Pagesevil, military, politics, love and marriage, religion, racial prejudice, gender conflict, and sexuality; but the controversy and debate surrounding Othello is â€Å"Why is Othello a qualification for a tragedy?† Most readers are aware of the many famous deaths or acts of death within the Shakespearean plays. And when the main characters die in Shakespeare’s plays, indeed, the readers would categorize the play as a tragedy. The problem with any tragedy definition is that most tragic plays do not defineRead MoreThe Between Traditional And Modern Roles Of The Woman1713 Words   |  7 Pagesmold that has historically restricted them. Before this revolution, women were expected to play their part, and that part was definitely not equal to that of a man. Unfortunately, sometimes when women decide that they do not want to fulfill their role, many men and sometimes women look down upon them in disapproval. Throughout the book â€Å"To the Lighthouse† by Virginia Woolf, she uncovers the difference between traditional and modern roles of the woman. She explores the true definition of female genderRead MoreMinority Identity1672 Words   |  7 Pagesidentification, their voting behavio r and their interest in group activities. However the way one person may see themselves may not be the way they are perceived by others. Ascribed identity can be described as the way that society, or other people impose on you. A factor that is heavily involved in shaping ascribed identity is stereotyping. Stereotyping is defined as assign a set of particular attributes to a person based on presumed membership of a certain group. Stereotypes usually involves simplifying aRead More The Battle Over Same-Sex Marriage Essay2181 Words   |  9 Pages Same-sex marriage has grown into to a national issue. In 2003, the Massachusetts Supreme Court ruled that same-sex couples had the right to marry which provoked a firestorm of debate. The discussion extends from private livings rooms and local watering holes; all the way to the floor of the U.S. Congress and the White House. The debate about same-sex marriage has become a hot button issue, which pits secular-progressives who support gay-rights against religious and social traditionalistsRead MoreEthical Issue Of Same Sex Marriage Essay2348 Words   |  10 PagesIss ue of Same-Sex Marriage On June 26, 2015, it was ruled by the the US Supreme Court that the US Constitution will guarantee that same-sex couples have the right to marriage in all 50 states of the US (state by state, n.d.). By many, this was celebrated as a victory. A Victory in the sense of equality, rights, and love. By others, this was seen as an immoral setback. I come to wonder who is right. Is there a right side? I know that there is a side who is for same-sex marriage and there is a sideRead MoreIndividualism Vs. American Life2154 Words   |  9 Pages(Viii). Americans separate work, family and community, when in fact, these worlds must be combined. We are hiding in such lifestyle enclaves, our isolated existence limits our ability to relate ourselves to a broader community. The virtue of community interaction lies in its ability to provide meaning to the frustrating mechanisms of politics and combat the inevitable loneliness of the separate self (Bellah et. al., 190). It seems our definition of success is related to our own individuality. Our

The Importance Of Government Transparency And Accountability

There are about fourteen rights of the accused from arrest to trial. Prior to the discussion of the rights to the accused, it is important to note the importance of government transparency and accountability throughout this paper. Under the fourth amendment there are three provisions that needs to be discussed. Two of these provisions: No improper searches and seizures, and Evidence obtained by illegal search not admissible during trial. In 1990, the Supreme Court summarized the Fourth Amendment brilliantly and succinctly: â€Å" A search compromises the individual interest in privacy; a seizure deprives the individual of dominion over his or her person or property.† In order to narrow down what is reasonable and what is unreasonable is best explained in the 1961 case of Mapp v. Ohio. The courts established an exclusionary rule, which prohibits evidence obtained during an illegal search from being introduced in a trial. This case was about a warrantless search for a bom bing suspect where police discovered illegal artifacts that were not related to the former cause. Upon reaching a verdict by the Supreme court, they found all evidence obtained by searches and seizure in violation of the Constitution and was inadmissible. In layman s term, even if a person was guilty of a crime of which they are accused, they can not be convicted if the only evidence for their conviction was obtained illegally. The transparency in part of the police for the search is questionable due toShow MoreRelatedThe Global Of Natural Resource Curse And Transparency846 Words   |  4 Pages according to the US Department of Energy, but has one of the least corrupt governments in the world, also according to the World Bank. Norway is one of the top ten exporters of crude oil in the world, while maintaining its stature as a perennial leader of the United Nations Human Development Index. In this way, natural resource curse did not appear to be unavoidable. Global Approaches to Resource Curse and Transparency The widespread of negative impact of natural resource abundance lead the worldRead MoreRole Of The Irs Moving Forward1142 Words   |  5 Pagestopic of bringing transparency and open government into the current administration. Barack Obama writes, â€Å"My Administration is committed to creating an unprecedented level of openness in Government. We will work together to ensure the public trust and establish a system of transparency, public participation, and collaboration. Openness will strengthen our democracy and promote efficiency and effectiveness in Government.† The President goes on to say, â€Å"Transparency promotes accountability and providesRead MoreHistory And Meaning Of Corporate Governance1450 Words   |  6 Pageswith a direction. It helps to ensure a balance between the different stakeholders within the company. These stakeholders typically involve: †¢ Shareholders, †¢ management team, †¢ the company’s customers, †¢ different suppliers, †¢ financiers, †¢ the government, and †¢ the wider community. Corporate governance allows defining the aspects of management of the company, from action plans to corporate disclosure. It guarantees a set of operational procedures for the above stakeholders, as well as the frameworkRead MorePublic Governance And Internal Control1252 Words   |  6 Pages1.0 Introduction Charities in the UK and in general have come through a lot of criticisms from external stakeholders on the state of their ineffective accountability and transparency, which portrays that charities do not comply with effective corporate governance and internal control (CG+IC) in order to improve their performance and credibility. The research will pinpoint the inadequacies of CG+IC, then evaluate how when applied effectively could contribute to charities’ performance and aid credibilityRead MoreBarack Obama And Donald J. Trump991 Words   |  4 Pagesnations around the world recognized the first ever â€Å"International Day for Universal Access to Information,† in accordance with a recently adopted UNESCO resolution. The day’s purpose is to commemorate the importance of the right to information and increased transparency from leaders and government around the world. And even though the day has remained relatively unknown to most people, its message resonates al l too well for the American public. We need only look to this year’s leaks pertaining to bothRead MoreFactors of Economic Development1163 Words   |  5 Pagesand how they contribute to economic development. Good government The system of government that is found within a country is a major determinant of the economic development that can take place within the country. This is because; most of the industries in a country are under the control of the government in one way or another. There are government agencies that usually maintain the standards of operations within the industries. The government also has the duty to approve of investments that are beingRead MoreA Role that should Rule Essay1714 Words   |  7 Pageslocal government) A Micro Essay Presented to Prof. Clyde Ben Gacayan Division of Social Sciences, College of Arts and Sciences University of the Philippines Visayas, Miagao, Iloilo In Partial Fulfillment of the Requirements For the Course in Political Science 14 By Noah Faye Andres March 4, 2014 A Role that should Rule (An article concerning the roles of LGU to its constituents through public funds as well as citizens’ roles in having and maintaining a just and honest local government) TheRead MoreCorporate Management : Corporate Governance Essay1550 Words   |  7 Pagesworld. It is envisioned to enhance the accountability of a concern and to evade huge disasters before they occur. The concept of corporate governance dived to global attention after the sudden crashes of Enron, World Com, Xerox, Lehman Brothers, Parmalat, Satyam etc. The failure of these colossal business houses horrified the corporate world with their unethical and unlawful operations which affected the employment, finances of national and local government worldwide and international economy. TheRead MoreLocal Controls Funding Formula And Local Control Accountability Plan794 Words   |  4 Pagesthe Local Control Funding Formula and the Local Control Accountability Plan. Each member of the panel contributed honestly about LCFF and LCAP as it relates to the states vision of moving forward in trying to close the achievement gap for all students. Paul Richman, California State PTA Executive Director opened the conversation by saying â€Å"districts need to focus on three T’s: Trust, Transparency, and Tenacity†. He emphasized the importance of parent involvement by stating â€Å"parent engagement isRead MoreCorporate Governance And Role Of Managers1698 Words   |  7 Pagessocially and legally responsible manner. In a proper corporate governance structure there is a proper division of roles and responsibilities and accountability of each member is well defined. All managers and leaders of a organization has to play a very vital role in developing a better corporate governance because they determine the structure and accountability. Managers and leaders can control the action of employees, help in developing policies and strategies and they are the people who make decision

The War on Drugs and Its Impact on Latin America Essay...

Ever since the war on drugs was started, most of the battle has been concentrated in Latin America, leaving trails of devastation from deep within Latin America up to the largest consumer of those substances. After years of fighting, and series’ of more and more aggressive policies put into place by the United States, drugs are just as prevalent if not more so than when the war began. Illegal drugs are still easy to obtain, demand for such substances has skyrocketed and cartels are becoming increasingly affluent. Drug violence since 2006 has resulted in the death of more than 60,000 people. Clearly, our current policies in waging this war are not effective, we have spent over 35 billion dollars over the course of 2013 to attempt to combat†¦show more content†¦Mexico’s war on drugs was officially decreed by then President Felipe Calderon, but has existed in some form since long before that. In the 1920s a law was drafted that deemed drugs and drug trafficking to be of the highest priority for national security. Throughout time, Mexico has a history of very strict drug enforcement laws, stemming from the issue being one of national security. Strangely enough, before 2006, when the war on drugs was formally declared, Mexico as well as other Latin American countries were having less trouble with drugs as a threat to national stability than after the formal declaration that labeled them as a destabilizing national security threat. Marijuana was banned from Mexico City in the 1860s and the State of Oaxaca shortly after that, with the surrounding areas following suit. After the Mexican Revolution in 1910, cocaine and opium imports began to be restricted by the newly empowered Superior Board of Health. The then leader of the Superior Board of Health, Josà © Marà ­a Rodrà ­guez, pushed for these reforms, citing the need for a healthy vibrant population due to the country’s proximity to other rapidly growing nations (namely the US). The e asily made link between drugs and disparagement, treachery, prison, death, madeShow MoreRelatedThe Impact Of Latin American Culture On Latin America1656 Words   |  7 Pagesbeing in an active war zone, living in Latin America would be much like that. The war being fought here is very different, instead of fighting another country, they are fighting drugs. Although war is generally a negative thing, this one is not. In this war there are negatives, but the positives far outweigh them. Latin American countries have witnessed the very noticeable benefits of the drug trade in many aspects of everyday life. The use and production of drugs is important to Latin American cultureRead Moreâ€Å"The War On Drugs Is A Big Fucking Lie†. In Recent History,1560 Words   |  7 Pagesâ€Å"The war on drugs is a big fucking lie† In recent history, there has been much rhetoric surrounding the eradication of cross-border drug trafficking. The â€Å"war on drugs† was introduced in the 1970s by Nixon, who wanted to eliminate the drugs coming into the United States, since they were seen by him as a threat to our nation. Many laws have been enacted with the purpose keeping illicit drugs out of the United States, yet they do so through the use of nativist ideology, which upholds white supremacyRead MoreDrug Trafficking1134 Words   |  5 PagesThe international drug trade from Latin American states is having an impact on a global scale. The trafficking of drugs along with corruptness and murder is an international conflict that is being fought daily. There are many aspects of the drug war from Mexico and other Latin American states which have effects on United States policy as well as policies from other countries that participate in the global suppression of illegal drugs. It can be hard to differentiate between conflict and issueRead MoreEssay on Mexican/Latin American â€Å"War† on Drugs and Trafficking1122 Words   |  5 PagesThe international drug trade from Latin American states is having an impact on a global scale. The trafficking of drugs along with corruptness and murder is an international conflict that is being fought daily. There are many aspects of the drug war from Mexico and other Latin American states which have effects on United States policy as well as policies from other countries that participate in the global suppression of illegal drugs. 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It has been over forty years since President Nixon declared a war on drugs. Did America win the war on drugs? Is it time to legalize il licit drugs in this country? What are other countries doing in referenceRead More Can Economic Aid Make a Difference in Flow of Drugs? Essays981 Words   |  4 PagesEconomic Aid Make a Difference in Flow of Drugs? 1. The United States government spends nearly $100 million annually, working towards the goal of greatly reducing the drug flow into this country (Abbott 160). Compared to the $100 million the U.S. spends, the $3 to $5 billion the Latin American countries bring in each year from drug trafficking is quite unbalanced. While researchers agree drug crops create a source of income for a number of Latin American people, they disagree about whetherRead MoreThe United States And Latin American Relations1377 Words   |  6 PagesStates has been a heavily involved in Latin American affairs for a long time, and there is great controversy surrounding how good of a neighbor we have been. As the â€Å"Colossus of the North†, this country holds enormous power. The question is; have we used our power for good or for evil? At times, we have been generous to Latin American countries. We returned the Panama Canal to the Panamanians and created free trade with Mexico through NAFTA. However, the negative impact we have had outweighs the good.Read MoreThe Impacts of the War on Drugs1075 Words   |  4 Pages The War On Drugs has lasted many years, including before it was officially called â€Å"War On Drugs.† The prohibition of drugs first got its start in the late 1800’s with anti-opium laws, focusing on chinese immigrants. This was common with the first anti-drug laws. It entirely about scientific based facts on what the effects or risks of the drugs, rather who was associated with the use of the specific drugs. For example, the anti-cocaine laws in the early 1900’s were directed at black men, and theRead MoreCritical Analysis of a Published Article Essay1272 Words   |  6 PagesCritical analysis of a published article (1000 words) Saturday 10th October 2009 By Joana Wong This critical analysis is about an article that argues whether drugs should be legalized or not. It was published in The Observer, on Sunday the 6th of September 2009 and it is entitled Latin Americas backlash against US war on drugs by Ed Vulliamy in Tijuana, Rory Carroll in Caracas, Annie Kelly in Buenos Aires and Tom Phillips in Rio de Janeiro. It is a lengthy article, written in a Sunday newspaper

Biography of Ernest Hemingway Essay - 1257 Words

â€Å"They only want to kill when they’re alone. Of course, if you went in there you’d probably detach one of them from the herd, and he’d be dangerous (Hemingway).† This quote, from Hemingway’s The Sun Also Rises, was one of his many pieces of work that helped light the way for new authors. Hemingway believed that minimal details created a better story, leaving mysteries for readers to solve on their own. Hemingway described his style as the Iceberg Theory. Hemingway deserves to be in the literary canon because he is a master of diction, his stories are unique and original, and he developed a new writing style that many authors still use today. Ernest Hemingway was born on July 21, 1899 in Oak Park, Illinois. His mother was very†¦show more content†¦Hemingway portrays this image through his characters which can only be described as larger than life. â€Å"Typical characters, they are usually tough men, experienced in the hard world s they inhabit, and not given to emotional display or sensitive shrinking (Warren 3).† The best way to describe most of Hemingway’s characters would be the perfect image of a man. When confronted with a challenge, they would fight through or go down on their own terms. Hemingway’s characters where in a way the spitting image of him. In many of his books Hemingway’s characters followed a code, â€Å"If they are to be defeated, they are defeated upon their own terms; some of them have even courted their defeat (Warren 3).† When Hemingway grew older, he thought he was losing his ability to write. When the day finally came when he thought he had lost all his talent, he killed himself. Hemingway wanted to live his life like the characters he wrote about and decided to end his life before he become engulfed in failure or defeat (amsaw.org, 5). Hemingway had a very rough love life, often ending in divorce and heartbreak. His first heartbreak came during World War 1 when he fell in love with an English nurse who ended up leaving him for another man. Hemingway wrote about his pain in his book, A Farewell to Arms. Just like his experience, he â€Å"tells the story of a tragically terminated love affair between an American soldier and an English nurse,Show MoreRelatedErnest Hemingway: A Brief Biography 1210 Words   |  5 PagesErnest Hemingway was born in Oak Park, Illinois in 1899. He was a writer who started his career with a newspaper office in Kansas City when he was seventeen. When the United States got involved in the First World War, Hemingway joined with a volunteer ambulance unit in the Italian army. During his service, he was wounded, and was decorated by the Italian Government. Upon his return to the United States, he was employed by Canadian and American newspapers as a reporter, and sent back to EuropeRea d More Biography of Ernest Hemingway Essay3737 Words   |  15 PagesBiography of Ernest Hemingway Certainly there is no hunting like the hunting of man and those who have hunted armed men long enough and liked it, never really care for anything else thereafter. You will meet them doing various things with resolve, but their interest rarely holds because after the other thing ordinary life is as flat as the taste of wine when the taste buds have been burned off your tongue. (On the Blue Water in Esquire, April 1936) A legendary novelist, short-storyRead More Biography of Ernest Miller Hemingway Essay3798 Words   |  16 PagesBiography of Ernest Miller Hemingway Ernest Miller Hemingway was an American novelist, journalist, writer of short stories, and winner of the 1954 Nobel Prize for literature. He created a distinguished body of prose fiction, much of it based on adventurous life. He was born on July 21, 1899, the second of six children, in Oak Park, Ill., in a house built by his widowed grandfather, Ernest Hall. Oak Park was a Protestant, upper middle class suburb of Chicago. He died on July 2, 1961. EarlyRead MoreTaking a Look at Ernest Hemingway1167 Words   |  5 PagesErnest Hemingway Research Paper Ernest Hemingway was an extraordinary individual. There was a lot more to his life than most readers know about. His writing was influenced by the lifestyle that he led. Hemingway was an adventurous person that liked to live life to its fullest. Just like everyone, he made decisions that were both good and bad, and his decisions and actions shaped his writing style. Hemmingway found a great deal of success and his career was topped off with him being awarded theRead MoreThe Life of Ernest Hemingway Essay1191 Words   |  5 PagesErnest Hemingway â€Å"But man is not made for defeat, he said. A man can be destroyed but not defeated.† (Hemingway, 29). This is one of the lines that Ernest Hemingway uses in one of his books, titled, â€Å"The Old Man and The Sea.† It was published in 1952, and was awarded the Pulitzer Prize the following year. The story of an old fishermans journey, his long and lonely struggle with a fish and the sea, was considered to be the most popular of all his works. Fortunately for this well-known author, heRead More Ernets Hemingway Essay example1287 Words   |  6 Pages Ernest Hemingway I.nbsp;nbsp;nbsp;nbsp;nbsp;Introduction to Ernest Hemingway II.nbsp;nbsp;nbsp;nbsp;nbsp;Life and Times A.nbsp;nbsp;nbsp;nbsp;nbsp;Early Life 1.nbsp;nbsp;nbsp;nbsp;nbsp;Birth 2.nbsp;nbsp;nbsp;nbsp;nbsp;Parents 3.nbsp;nbsp;nbsp;nbsp;nbsp;Influences 4.nbsp;nbsp;nbsp;nbsp;nbsp;Siblings 5.nbsp;nbsp;nbsp;nbsp;nbsp;Hobbies B.nbsp;nbsp;nbsp;nbsp;nbsp;Adulthood 1.nbsp;nbsp;nbsp;nbsp;nbsp;War 2.nbsp;nbsp;nbsp;nbsp;nbsp;Influences 3.nbsp;nbsp;nbsp;nbsp;nbsp;MarriageRead MoreThe Clouded Life Of Ernest Hemingway2032 Words   |  9 PagesThe Clouded Life of Ernest Hemingway â€Å"Every man s life ends the same way. It is only the details of how he lived and how he died that distinguish one man from another,† (Hemingway). The details of Ernest Hemingway’s life are nothing short of remarkable. The dash between the dates on his gravestone more than distinguish him from the notable mid-century authors he competed with. The life and works of Hemingway has stimulated the minds of people all over the world for the last one-hundred and sixteenRead MoreA Farewell To Arms By Ernest Hemingway Analysis1694 Words   |  7 Pagesthe way they wish they could. One example of this is in Ernest Hemingway’s novel, A Farewell To Arms. The brave World War One ambulance driver, Frederic Henry, shares many traits with the esteemed author. It’s almost like he’s the Batman to Hemingway’s Bruce Wayne. Hemingway often wrote from experience, whether it was drawing upon his experience at a bullfight or even writing about his time spent on the Italian front (Ernest Hemingway Biography ~ World War I 1). He shares several experiences withRead MoreTo Let The Air In964 Words   |  4 Pageshousewife, the mother and the submissive doormat to more empowering trajectories. Many debatable issues surround women’s campaign of liberties including the broadly debated right to decide who has ultimate say in regards of getting an abortion. Ernest Hemingway wrote a story called, â€Å"Hills Like White Elephants† that conveyed the viewpoint of females centered around the topic . Well into character’s development the reader sees Jig’s ability to come to her own decision about the procedure and submit toRead MoreErnest Hemingway And Frederick Henry1754 Words   |  8 PagesErnest Hemingway and Frederick Henry: Author and Fictional Character, Alike yet Different It can be said that all fiction is autobiographical in that no matter how different from the author’s life experience it may be, marks of their life can be found in any of their works and characters. One such example is Ernest Hemingway’s A Farewell to Arms, which is largely based on Hemingway’s own personal life experiences. Frederick Henry, the main character in the story, experiences many of the same situations

Variable Cost and Contribution Margin Free Essays

string(47) " sale could well open a new marketing channel\." CHAPTER 12 PRICING DECISIONS AND COST MANAGEMENT 12-1The three major influences on pricing decisions are 1. Customers 2. Competitors 3. We will write a custom essay sample on Variable Cost and Contribution Margin or any similar topic only for you Order Now Costs 12-2Not necessarily. For a one-time-only special order, the relevant costs are only those costs that will change as a result of accepting the order. In this case, full product costs will rarely be relevant. It is more likely that full product costs will be relevant costs for long-run pricing decisions. 12-3Two examples of pricing decisions with a short-run focus: 1. Pricing for a one-time-only special order with no long-term implications. . Adjusting product mix and volume in a competitive market. 12-4Activity-based costing helps managers in pricing decisions in two ways. 1. It gives managers more accurate product-cost information for making pricing decisions. 2. It helps managers to manage costs during value engineering by identifying the cost impact of eliminating, reducing, or changing various activities. 12-5Two alternative starting points for long-run pricing decisions are 1. Market-based pricing, an important form of which is target pricing. The market-based approach asks, â€Å"Given what our customers want and how our competitors will react to what we do, what price should we charge? † 2. Cost-based pricing which asks, â€Å"What does it cost us to make this product and, hence, what price should we charge that will recoup our costs and achieve a target return on investment? † 12-6A target cost per unit is the estimated long-run cost per unit of a product (or service) that, when sold at the target price, enables the company to achieve the targeted operating income per unit. 2-7Value engineering is a systematic evaluation of all aspects of the value-chain business functions, with the objective of reducing costs while satisfying customer needs. Value engineering via improvement in product and process designs is a principal technique that companies use to achieve target cost per unit. 12-8A value-added cost is a cost that customers perceive as adding value, or utility, to a product or service. Examples are co sts of materials, direct labor, tools, and machinery. A nonvalue-added cost is a cost that customers do not perceive as adding value, or utility, to a product or service. Examples of nonvalue-added costs are costs of rework, scrap, expediting, and breakdown maintenance. 12-9No. It is important to distinguish between when costs are locked in and when costs are incurred, because it is difficult to alter or reduce costs that have already been locked in. 12-10Cost-plus pricing is a pricing approach in which managers add a markup to cost in order to determine price. 2-11Cost-plus pricing methods vary depending on the bases used to calculate prices. Examples are (a) variable manufacturing costs; (b) manufacturing function costs; (c) variable product costs; and (d) full product costs. 12-12Two examples where the difference in the costs of two products or services is much smaller than the differences in their prices follow: 1. The difference in prices charged for a telephone call, hotel room, or car rental during busy versus slack periods is of ten much greater than the difference in costs to provide these services. 2. The difference in costs for an airplane seat sold to a passenger traveling on business or a passenger traveling for pleasure is roughly the same. However, airline companies price discriminate. They routinely charge business travelers––those who are likely to start and complete their travel during the same week excluding the weekend––a much higher price than pleasure travelers who generally stay at their destinations over at least one weekend. 12-13Life-cycle budgeting is an estimate of the revenues and costs attributable to each product from its initial RD to its final customer servicing and support. 2-14Three benefits of using a product life-cycle reporting format are: 1. The full set of revenues and costs associated with each product becomes more visible. 2. Differences among products in the percentage of total costs committed at early stages in the life cycle are highlighted. 3. Interrelationships among business function cost categories are highlighted. 12-15Predatory pricing occurs when a business deliberately prices below its costs in an effort to drive competitors out of the market and restrict supply, and then raises prices rather than enlarge demand. Under U. S. laws, dumping occurs when a non-U. S. company sells a product in the United States at a price below the market value in the country where it is produced, and this lower price materially injures or threatens to materially injure an industry in the United States. Collusive pricing occurs when companies in an industry conspire in their pricing and production decisions to achieve a price above the competitive price and so restrain trade. 12-16(20–30 min. ) Relevant-cost approach to pricing decisions, special order. . Relevant revenues, $4. 00 ( 1,000$4,000 Relevant costs Direct materials, $1. 60 ( 1,000$1,600 Direct manufacturing labor, $0. 90 ( 1,000900 Variable manufacturing overhead, $0. 70 ( 1,000700 Variable selling costs, 0. 05 ( $4,000 200 Total relevant costs 3,400 Increase in operating income$ 600 This calculation assumes that: a. The monthly fixed manufacturing overhead of $150,000 and $65,000 of monthly fixed marketing costs will be unchanged by acceptance o f the 1,000 unit order. b. The price charged and the volumes sold to other customers are not affected by the special order. Chapter 12 uses the phrase â€Å"one-time-only special order† to describe this special case. 2. The president’s reasoning is defective on at least two counts: a. The inclusion of irrelevant costs––assuming the monthly fixed manufacturing overhead of $150,000 will be unchanged; it is irrelevant to the decision. b. The exclusion of relevant costs––variable selling costs (5% of the selling price) are excluded. 3. Key issues are: . Will the existing customer base demand price reductions? If this 1,000-tape order is not independent of other sales, cutting the price from $5. 00 to $4. 00 can have a large negative effect on total revenues. b. Is the 1,000-tape order a one-time-only order, or is there the possibility of sales in subsequent months? The fact that the customer is not in Dill Company’s â€Å"normal marketing channels† does not n ecessarily mean it is a one-time-only order. Indeed, the sale could well open a new marketing channel. You read "Variable Cost and Contribution Margin" in category "Essay examples" Dill Company should be reluctant to consider only short-run variable costs for pricing long-run business. 12-17(20–30 min. )Relevant-cost approach to short-run pricing decisions. 1. Analysis of special order: Sales, 3,000 units ( $75$225,000 Variable costs: Direct materials, 3,000 units ( $35$105,000 Direct manufacturing labor, 3,000 units ( $1030,000 Variable manufacturing overhead, 3,000 units ( $618,000 Other variable costs, 3,000 units ( $515,000 Sales commission 8,000 Total variable costs 176,000 Contribution margin$ 49,000 Note that the variable costs, except for commissions, are affected by production volume, not sales dollars. If the special order is accepted, operating income would be $1,000,000 + $49,000 = $1,049,000. 2. Whether McMahon’s decision to quote full price is correct depends on many factors. He is incorrect if the capacity would otherwise be idle and if his objective is to increase operating income in the short run. If the offer is rejected, San Carlos, in effect, is willing to invest $49,000 in immediate gains forgone (an opportunity cost) to preserve the long-run selling-price structure. McMahon is correct if he thinks future competition or future price concessions to customers will hurt San Carlos’s operating income by more than $49,000. There is also the possibility that Abrams could become a long-term customer. In this case, is a price that covers only short-run variable costs adequate? Would Holtz be willing to accept a $8,000 sales commission (as distinguished from her regular $33,750 = 15% ( $225,000) for every Abrams order of this size if Abrams becomes a long-term customer? 12-18(15-20 min. Short-run pricing, capacity constraints. 1. Per kilogram of hard cheese: |Milk (8 liters [pic] $2. 00 per liter) |$16 | |Direct manufacturing labor |5 | |Variable manufacturing overhead |4 | |Fixed manufacturing cost allocated | 6 | |Total manufacturing cost |$31 | | | | If Colorado Mountains Dairy can get all the Holstein milk it needs, and has sufficient production capacity, then the minimum price per kilo it should charge for the hard cheese is the variable cost per kilo = $16 + $5 + $4 = $25 per kilo. 2. If milk is in short supply, then each kilo of hard cheese displaces 2 kilos of soft cheese (8  liters of milk per kilo of hard cheese versus 4 liters of milk per kilo of soft cheese). Then, for the hard cheese, the minimum price Colorado Mountains should charge is the variable cost per kilo of hard cheese plus the contribution margin from 2 kilos of soft cheese, or, 25 + (2 [pic] $10 per kilo) = $45 per kilo That is, if milk is in short supply, Colorado Mountains should not agree to produce any hard cheese unless the buyer is willing to pay at least $45 per kilo. 12-19 (25–30 min. ) Value-added, nonvalue-added costs. 1. |Category |Examples | | |Value-added costs |a. Materials and labor for regular repairs |$800,000 | |Nonvalue-added cost s |b. Rework costs |$ 75,000 | | |c. Expediting costs caused by work delays |60,000 | | |g. Breakdown maintenance of equipment |55,000 | | |Total |$190,000 | |Gray area |d. Materials handling costs |$ 50,000 | | |e. Materials procurement and inspection costs |35,000 | | |f. Preventive maintenance of equipment |15,000 | | |Total |$100,000 | Classifications of value-added, nonvalue-added, and gray area costs are often not clear-cut. Other classifications of some of the cost categories are also plausible. For example, some students may include materials handling, materials procurement, and inspection costs and preventive maintenance as value-added costs (costs that customers perceive as adding value and as being necessary for good repair service) rather than as in the gray area. Preventive maintenance, for instance, might be regarded as value-added because it helps prevent nonvalue-adding breakdown maintenance. 2. Total costs in the gray area are $100,000. Of this, we assume 65%, or $65,000, are value-added and 35%, or $35,000, are nonvalue-added. Total value-added costs: $800,000 + $65,000 $ 865,000 Total nonvalue-added costs: $190,000 + $35,000 225,000 Total costs$1,090,000 Nonvalue-added costs are $225,000 ? $1,090,000 = 20. 64% of total costs. Value-added costs are $865,000 ? $1,090,000 = 79. 36% of total costs. |3. |Effect on Costs Classified as | | |Value-Added |Nonvalue-Added |Gray | |Program | | |Area | |(a) Quality improvement programs to | | | | |†¢ reduce rework costs by 75% (0. 5 ( $75,000) | |–$ 56,250 | | |†¢ reduce expediting costs by 75% | | | | |(0. 75 ( $60,000) | |– 45,000 | | |†¢ reduce materials and labor costs by 5% | | | | |(0. 5 ( $800,000) |–$ 40,000 |  Ã‚     Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   | | |Total effect |–$ 40,000 |–$101,250 | | | | | | | |(b) Working with suppliers to | | | | |†¢ reduce materials procurement and inspection costs by 20% (0. 0 ( $35,000) | | | | |†¢ reduce materials handling costs by 25% | | |–$ 7,000 | |(0. 25 ( $50,000) | | | | |Total effect | | |– 12,500 | |Transferring 65% of gray area costs (0. 5 ( | | |– 19,500 | |$19,500 = $12,675) as value-added and 35% | | | | |(0. 5 ( $19, 500 = $6,825) as nonvalue-added | | | | |Effect on value-added and nonvalue-added costs |–$ 12,675 |–$ 6,825 |+ 19,500 | | |–$ 12,675 |–$ 6,825 |$ 0 | |(c) Maintenance programs to | | | | |†¢ increase preventive maintenance costs by 50% | | | | |(0. 0 ( $15,000) | | |+$ 7,500 | |†¢ decrease breakdown maintenance costs by 40% | | | | |(0. 40 ( $55,000) | |–$ 22,000 |  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   | |Total effect | |– 22,000 |+ 7,500 | |Transferring 65% of gray area costs (0. 65 ( $7,500 = $4,875) as value-added and 35%| | | | |(0. 5 ( $7,500 = $2,625) as nonvalue-added | | | | |Effect on value-added and nonvalue-added costs |+$ 4,875 |+ 2,625 |– 7,500 | | |+$ 4,875 |–$  Ã‚  19,375 |$ 0 | |Total effect of all programs |–$ 47,800 |–$127,450 | | |Value-added and nonvalue-added costs calculated in requirement 2 | | | | |Expected value-added and nonvalue-added costs as a result of implementing these |865,000 |225,000 | | |programs | | | | | |$817,200 |$ 97,550 | | If these programs had been implemented, total costs would have decreased from $1,090,000 (requirement 2) to $817,200 + $97,550 = $914,750, and the percentage of nonvalue-added costs would decrease from 20. 64% (requirement 2) to $97,550 ? 914,750 = 10. 66%. These are significant improvements in Marino’s performance. 12-20(25(30 min. ) Target operating income, value-added costs, service company. 1. The classification of total costs in 2012 into value-added, nonvalue-added, or in the gray area in between follows: ValueGrayNonvalue-Total AddedAreaadded(4) = (1) (2) (3) (1)+(2)+(3) Doing calculations and preparing drawings 77% ? $390,000$300,300$300,300 Checking calculations and drawings 3% ? $390,000$11,70011,700 Correcting errors found in drawings 8% ? $390,000$31,20031,200 Making changes in response to client requests 5% ? $390,000 19,50019,500 Correcting errors to meet government building code, 7% ? $390,000 27,300 27,300 Total professional labor costs 319,800 11,700 58,500 390,000 Administrative and support costs at 44% ($171,600 ? $390,000) of professional labor costs 140,712 5,148 25,740 171,600 Travel 15,000 — 15,000 Total$475,512$16,848$84,240$576,600 Doing calculations and responding to client requests for changes are value-added costs because customers perceive these costs as necessary for the service of preparing architectural drawings. Costs incurred on correcting errors in drawings and making changes because they were inconsistent with building codes are nonvalue-added costs. Customers do not perceive these costs as necessary and would be unwilling to pay for them. Calvert should seek to eliminate these costs by making sure that all associates are well-informed regarding building code requirements and by training associates to improve the quality of their drawings. Checking calculations and drawings is in the gray area (some, but not all, checking may be needed). There is room for disagreement on these classifications. For example, checking calculations may be regarded as value added. 2. Reduction in professional labor-hours by a. Correcting errors in drawings (8% ? 7,500)600 hours b. Correcting errors to conform to building code (7% ? 7,500) 525 hours Total 1,125 hours Cost savings in professional labor costs (1,125 hours ? $52)$ 58,500 Cost savings in variable administrative and support costs (44% ? $58,500) 25,740 Total cost savings$ 84,240 Current operating income in 2012$124,650 Add cost savings from eliminating errors 84,240 Operating income in 2012 if errors eliminated$208,890 3. Currently 85% ? 7,500 hours = 6,375 hours are billed to clients generating revenues of $701,250. The remaining 15% of professional labor-hours (15% ? 7,500 = 1,125 hours) is lost in making corrections. Calvert bills clients at the rate of $701,250 ? 6,375 = $110 per professional labor-hour. If the 1,125 professional labor-hours currently not being billed to clients were billed to clients, Calvert’s revenues would increase by 1,125 hours ? $110 = $123,750 from $701,250 to $825,000 ($701,250 + $123,750). Costs remain unchanged Professional labor costs$390,000 Administrative and support (44% ? $390,000) 171,600 Travel 15,000 Total costs$576,600 Calvert’s operating income would be Revenues$825,000 Total costs 576,600 Operating income$248,400 12-21(25–30 min. Target prices, target costs, activity-based costing. 1. Snappy’s operating income in 2011 is as follows: | |Total for | | | |250,000 Tiles |Per Unit | | |(1) |(2) = (1) ? 250,000 | |Revenues ($4 ( 250,000) |$1,000,000 |$4. 00 | |Purchase cost of tiles ($3 ( 250,000) |750,000 |3. 0 | |Ordering costs ($50 ( 500) |25,000 |0. 10 | |Receiving and storage ($30 ( 4,000) |120,000 |0. 48 | |Shipping ($40 ( 1,500) |60,000 |0. 24 | |Total costs |955,000 |3. 82 | |Operating income |$ 45,000 |$0. 18 | 2. Price to retailers in 2012 is 95% of 2011 price = 0. 95 ( $4 = $3. 80; cost per tile in 2012 is 96% of 2011 cost = 0. 96 ( $3 = $2. 88. Snappy’s operating income in 2012 is as follows: | |Total for | | | |250,000 Tiles |Per Unit | | |(1) |(2) = (1) ? 250,000 | |Revenues ($3. 80 ( 250,000) |$950,000 |$3. 0 | |Purchase cost of tiles ($2. 88 ( 250,000) |720,000 |2. 88 | |Ordering costs ($50 ( 500) |25,000 |0. 10 | |Receiving and storage ($30 ( 4,000) |120,000 |0. 48 | |Shipping ($40 ( 1,500) |60,000 |0. 24 | |Total costs |925,000 |3. 0 | |Operating income |$ 25,000 |$0. 10 | 3. Snappy’s operating income in 2012, if it makes changes in ordering and material handling, will be as follows: | |Total for | | | |250,000 Tiles |Per Unit | | |(1) |(2) = (1) ? 50,000 | |Revenues ($3. 80 ( 250,000) |$950,000 |$3. 80 | |Purchase cost of tiles ($2. 88 ( 250,000) |720,000 |2. 88 | |Ordering costs ($25 ( 200) |5,000 |0. 02 | |Receiving and storage ($28 ( 3,125) |87,500 |0. 35 | |Sh ipping ($40 ( 1,500) |60,000 |0. 4 | |Total costs |872,500 |3. 49 | |Operating income |$ 77,500 |$0. 31 | Through better cost management, Snappy will be able to achieve its target operating income of $0. 30 per tile despite the fact that its revenue per tile has decreased by $0. 20 ($4. 00 – $3. 80), while its purchase cost per tile has decreased by only $0. 12 ($3. 00 – $2. 88). 12-22 (20 min. ) Target costs, effect of product-design changes on product costs. 1. and 2. Manufacturing costs of HJ6 in 2010 and 2011 are as follows: 2010 2011 Per UnitPer Unit Total (2) = Total (4) = (1)(1) ? 3,500 (3)(3) ? 4,000 Direct materials, $1,200 ? 3,500; $1,100 ? 4,000$4,200,000$1,200$4,400,000$1,100 Batch-level costs, $8,000 ? 70; $7,500 ? 80 560,000 160 600,000 150 Manuf. operations costs, $55 ? 21,000; $50 ? 22,000 1,155,000 330 1,100,000 275 Engineering change costs, $12,000 ? 14; $10,000 ? 10 168,000 48 100,000 25 Total$6,083,000$1,738$6,200,000$1,550 3. [pic]= [pic] ? 90% = $1,738 ? 0. 90 = $1,564. 20 Actual manufacturing cost per unit of HJ6 in 2011 was $1,550. Hence, Medical Instruments did achieve its target manufacturing cost per unit of $1,564. 20 4. To reduce the manufacturing cost per unit in 2011, Medical Instruments reduced the cost per unit in each of the four cost categories—direct materials costs, batch-level costs, manufacturing operations costs, and engineering change costs. It also reduced machine-hours and number of engineering changes made—the quantities of the cost drivers. In 2010, Medical Instruments used 6 machine-hours per unit of HJ6 (21,000 machine-hours (3,500 units). In 2011, Medical Instruments used 5. 5 machine-hours per unit of HJ6 (22,000 machine-hours ( 4,000 units). Medical Instruments reduced engineering changes from 14 in 2010 to 10 in 2011. Medical Instruments achieved these gains through value engineering activities that retained only those product features that customers wanted while eliminating nonvalue-added activities and costs. 12-23(20 min. )Cost-plus target return on investment pricing. 1. Target operating income = target return on investment ( invested capital Target operating income (25% of $900,000)$225,000 Total fixed costs 375,000 Target contribution margin$600,000 Target contribution per room-night, ($600,000 ? 15,000) $40 Add variable costs per room-night 5 Price to be charged per room-night $45 Proof Total room revenues ($45 ( 15,000 room-nights)$675,000 Total costs: Variable costs ($5 ( 15,000)$ 75,000 Fixed costs 375,000 Total costs 450,000 Operating income$225,000 The full cost of a room = variable cost per room + fixed cost per room The full cost of a room = $5 + ($375,000 ? 15,000) = $5 + $25 = $30 Markup per room = Rental price per room – Full cost of a room = $45 – $30 = $15 Markup percentage as a fraction of full cost = $15 ? $30 = 50% 2. If price is reduced by 10%, the number of rooms Beck could rent would increase by 10%. The new price per room would be 90% of $45 $ 40. 50 The number of rooms Beck expects to rent is 110% of 15,000 16,500 The contribution margin per room would be $40. 50 – $5$ 35. 50 Contribution margin ($35. 50 ( 16,500)$585,750 Because the contribution margin of $585,750 at the reduced price of $40. 50 is less than the contribution margin of $600,000 at a price of $45, Blodgett should not reduce the price of the rooms. Note that the fixed costs of $375,000 will be the same under the $45 and the $40. 50 price alternatives and hence, are irrelevant to the analysis. 12-24(20(25 min. )Cost-plus, target pricing, working backwards. 1. Investment$8,400,000 Return on investment18% Operating income (18% ( $8,400,000)$1,512,000 Operating income per unit of XR500 ($1,512,000 ( 1,500)$1,008 Full cost per unit of XR500 (1,008 ? 0. 09)$11,200 Selling price (($11,200 + $1,008))$12,208 Markup percentage on variable cost ($1,008 ( $8,450)11. 93% Total fixed costs = (Full cost per unit – Variable cost per unit) ( Units sold = ($11,200 – $8,450) ( 1,500 units = $4,125,000 2. Contribution margin per unit = $12,208 – $8,450 = $3,758 Increase in sales = $10% ( 1,500 units = 150 units Increase in contribution margin = $3,758 ( 150 units =$563,700 Less: Advertising costs 500,000 Increase in operating income$ 63,700 Road Warrior should spend $500,000 in advertising because it increases operating income by $63,700. 3. |Revenues ($12,208 ? 1,400 units) |$17,091,200 | |Target full cost at 9% markup ($17,091,200 ? 1. 9) |$15,680,000 | |Less: Target total fixed costs ($4,125,000 – $125,000) | 4,000,000 | |Target total variable costs |$11,680,000 | |Divided by number of units | ? 1,400 units | |Target variable cost per unit |$ 8,342. 86 | 12-25(20 min. ) Life-cycle product costing. 1. [pic] Contribution margin per unit = Selling price – Variable cost per unit = $50 – $25 = $25 |Total fixed costs over |= |Design fixed costs |+ |Production fixed |+ |Marketing and distribution | |life of robot | | | |costs | |fixed costs | = $650,000 + $3,560,000 + $2,225,000 = $6,435,000 BEP in units = [pic] 2a. Option A: |Revenues ($50 [pic] 500,000 units) |$25,000,000 | |Variable costs ($25 [pic] 500,000 units) |12,500,000 | |Fixed costs | 6,435,000 | |Operating income |$ 6,065,000 | 2b. Option B: Revenues | | | Year 2 ($70 [pic] 100,000 units) |$ 7,000,000 | | Years 3 4 ($40[pic]600,000 units) | 24,000,000 | | Total revenues |31,000,000 | |Variable costs ($25 [pic] 700,000 units) |17,500,000 | |Fixed costs | 6,435,000 | |Operating income |$ 7,065,000 | Over the product’s life-cycle, Option B results in an overall higher operating income of $1,000,000 ($7,065,000 – $6,065,000). 12-26(30 min. )Relevant-cost approach to pricing decisions. |1. Revenues (1,000 c rates at $117 per crate) | |$117,000 | | |Variable costs: | | | | | Manufacturing |$35,000 | | | | Marketing | 17,000 | | | | Total variable costs | | 52,000 | | |Contribution margin | |65,000 | | |Fixed costs: | | | | | Manufacturing |$30,000 | | | | Marketing | 13,000 | | | | Total fixed costs | | 43,000 | | |Operating income | |$ 22,000 | Normal markup percentage: $65,000 ? $52,000 = 125% of total variable costs. 2. Only the manufacturing-cost category is relevant to considering this special order; no additional marketing costs will be incurred. Variable manufacturing cost per crate = $35,000 ? 1,000 crates = $35 per crate. The relevant manufacturing costs for the 200-crate special order are: Variable manufacturing cost per unit $35 ( 200 crates$ 7,000 Special packaging 3,000 Relevant manufacturing costs$10,000 Any price above $50 per crate ($10,000 ? 200) will make a positive contribution to operating income. Therefore, based on financial considerations, Stardom should accept the 200-crate special order at $55 per crate that will generate revenues of $11,000 ($55 ( 200) and relevant (incremental) costs of $10,000. The reasoning based on a comparison of $55 per crate price with the $65 per crate absorption cost ignores monthly cost-volume-profit relationships. The $65 per crate absorption cost includes a $30 per crate cost component that is irrelevant to the special order. The relevant range for the fixed manufacturing costs is from 500 to 2,000 crates per month; the special order will increase production from 1,000 to 1,200 crates per month. Furthermore, the special order requires no incremental marketing costs. 3. If the new customer is likely to remain in business, Burst should consider whether a strictly short-run focus is appropriate. For example, what is the likelihood of demand from other customers increasing over time? If Burst accepts the 200-crate special offer for more than one month, it may preclude accepting other customers at prices exceeding $55 per crate. Moreover, the existing customers may learn about Burst’s willingness to set a price based on variable cost plus a small contribution margin. The longer the time frame over which Burst keeps selling 200 crates of canned peaches at $55 a crate, the more likely it is that existing customers will approach Burst for their own special price reductions. If the new customer wants the contract to extend over a longer time period, Burst should negotiate a higher price. 12-27(25–30 min. )Considerations other than cost in pricing decisions. 1. |Guest nights on weeknights: | | |18 weeknights ? 100 rooms ? 0% = 1,620 | | |Guest nights on weekend nights: | | |12 weekend nights ? 100 rooms ? 20% = 240 | | |Total guest nights in April = 1,620 + 240 = 1,860 | | |Breakfasts served: | | |1,620 weeknight guest nights ? 1. 0 = 1,620 | | | 240 weekend guest nights ? 2. = 600 | | |Total breakfasts served in April = 1,620 + 600 = 2,220 | | |Total costs for April: | | |Depreciation |$ 20,000 | |Administrative costs |35,000 | |Fixed housekeeping and supplies |12,000 | |Variable housekeeping and supplies (1,860 ? $25) |46,500 | |Fixed breakfast costs |5,000 | |Variable breakfast costs (2,220 ? 5) | 11,100 | |Total costs for April |$129,600 | |Cost per guest night ($129,600 ? 1,860) |$69. 68 | |Revenue for April ($68 ? 1,860) |$126,480 | |Total costs for April | 129,600 | |Operating income/(loss) |$ (3,120) | 2. |New weeknight guest nights | | |18 weeknights ? 100 rooms ? 5% = 1,530 | | |New weekend guest nights | | |12 weeknights ? 100 rooms ? 50% = 600 | | |Total guest nights in April = 1,530 + 600 = 2,130 | | |Breakfasts served: | | |1,530 weeknight guest nights ? 1. 0 = 1,530 | | | 600 weekend guest nights ? 2. = 1,500 | | |Total breakfasts served in April = 1,530 + 1,500 = 3,030 | | |Total costs for April: | | |Depreciation |$20,000 | |Administrative costs |35,000 | |Fixed housekeeping and supplies |12,000 | |Variable housekeeping and supplies (2,130 ? $25) |53 ,250 | |Fixed breakfast costs |5,000 | |Variable breakfast costs (3,030 ? $5) | 15,150 | |Total costs |$140,400 | |Revenue [(1,530 ? $80) + (600 ? 50)] |$152,400 | |Total costs for April | 140,400 | |Operating income |$ 12,000 | Yes, this pricing arrangement would increase operating income by $15,120 from an operating loss of $3,120 to an operating income of $12,000 ($12,000 + $3,120 = $15,120). 3. The weeknight guests are business travelers who have to stay at the hotel on weeknights to conduct business for their organizations. They are probably not paying personally for their hotel stays, and they are more interested in the hotel’s location in the business park than the price of the stay, as long as it is reasonable. The demand of business travelers is inelastic. In contrast, the weekend guests are families who are staying at the hotel for pleasure and are paying for the hotel from their personal incomes. They are willing to consider other hotel options or even not travel at all if the price is high and unaffordable. The demand of pleasure travelers is elastic. Because of the differences in preferences of the weeknight and weekend guests, Executive Suites can price discriminate between these guests by charging $30 more on weeknights than on weekends and still have weeknight travelers stay at the hotel. 4. Executive Suites would need to charge a minimum of $35 per night for the last-minute rooms, an amount equal to the variable cost per room. Variable cost per room night = $25 per room night + $5 ? breakfasts = $35. Any price above $35 would increase Executive Suites operating income. 12-28 (25 min. ) Cost-plus, target pricing, working backward. 1. In the following table, work backwards from operating income to calculate the selling price |Sel ling price |$ 10. 14 (plug) | |Less: Variable cost per unit | 3. 75 | |Unit contribution margin |$ 6. 39 | |Number of units produced and sold | ? 00,000 units | |Contribution margin |$3,195,000 | |Less: Fixed costs | 3,000,000 | |Operating income |$ 195,000 | a)Total sales revenue = $10. 14 [pic] 500,000 units = $5,070,000 b)Selling price = $10. 14 (from above) Alternatively, |Operating income |$ 195,000 | |Add fixed costs | 3,000,000 | |Contribution margin |3,195,000 | |Add variable costs ($3. 75 ? 500,000 units) | 1,875,000 | |Sales revenue |$5,070,000 | [pic] )Rate of return on investment = [pic] d)Markup % on full cost Total cost = ($3. 75 [pic] 500,000 units) + $3,000,000 = $4,875,000 Unit cost = [pic] Markup % = [pic] Or [pic] |2. |New fixed costs |=$3,000,000 – $200,000 = $2,800,000 | | |New variable costs |= $3. 75 – $0. 60 = $3. 15 | | |New total costs |= ($3. 15 ? 500,000 units) + $2,800,000 = $4,375,000 | | |New total sales (5% markup) |= $4,375,000 [pi c] 1. 4 = $4,550,000 | | |New selling price |= $4,550,000 ? 500,000 units = $9. 10 | | |Alternatively, | | | |New unit cost |= $4,375,000 ? 500,000 units = $8. 75 | | |New selling price |= $8. 75 [pic] 1. 04 = $9. 10 | |3. |New units sold = 500,000 units ? 90% = $450,000 units | Budgeted Operating Income | |for the Year Ending December 31, 20xx | |Revenues ($9. 10 [pic] 450,000 units) |$4,095,000 | |Variable costs ($3. 15 [pic] 450,000 units) | 1,417,500 | |Contribution margin |2,677,500 | |Fixed costs | 2,800,000 | |Operating income (loss) |$ (122,500) | 12-29(40–45 min. ) Target prices, target costs, value engineering, cost incurrence, locked-in cost, activity-based costing. 1. |Old CE100 | |New CE100 | | | |Cost Change | | |Direct materials costs |$182,000 |$2. 20 [pic] 7,000 = $15,400 less |$166,600 | |Direct manufacturing labor costs |28,000 |$0. 50 [pic] 7,000 = $3,500 less |24,500 | |Machining costs |31,500 |Unchanged because capacity same |31,500 | |Testing costs |3 5,000 |(20% [pic] 2. 5 [pic] 7,000) ? 2 = $7,000 |28,000 | |Rework costs |14,000 |(See Note 1) |5,600 | |Ordering costs |3,360 |(See Note 2) |2,100 | |Engineering costs |21,140 |Unchanged because capacity same |21,140 | |Total manufacturing costs |$315,000 | |$279,440 | Note 1: 10% of old CE100s are reworked. That is, 700 (10% of 7,000) CE100s made are reworked. Rework costs = $20 per unit reworked ( 700 = $14,000. If rework falls to 4% of New CE100s manufactured, 280 (4% of 7,000) New CE100s manufactured will require rework. Rework costs = $20 per unit ( 280 = $5,600. Note 2 : Ordering costs for New CE100 = 2 orders/month ( 50 components ( $21/order = $2,100 Unit manufacturing costs of New CE100 = $279,440 ? 7,000 = $39. 92 2. Total manufacturing cost reductions based on new design= $315,000 – $279,440 = $35,560 Reduction in unit manufacturing costs based on new design= $35,560 ? 7,000 = $5. 08 per unit. The reduction in unit manufacturing costs based on the new design can also be calculated as Unit cost of old design, $45 ($315,000 ? 7,000 units) – Unit cost of new design, $39. 92 = $5. 08 Therefore, the target cost reduction of $6 per unit is not achieved by the redesign. 3. Changes in design have a considerably larger impact on costs per unit relative to improvements in manufacturing efficiency ($5. 08 versus $1. 50). One explanation is that many costs are locked in once the design of the radio-cassette is completed. Improvements in manufacturing efficiency cannot reduce many of these costs. Design choices can influence many direct and overhead cost categories, for example, by reducing direct materials requirements, by reducing defects requiring rework, and by designing in fewer components that translate into fewer orders placed and lower ordering costs. 12-30(25 min. )Cost-plus, target return on investment pricing. 1. Target operating income = Return on capital in dollars = $13,000,000[pic]10% = $1,300,000 2. |Revenues* |$6,000,000 | |Variable costs [($3. 50 + $1. 0)[pic]500,000 cases | 2,500,000 | |Contribution margin |3,500,000 | |Fixed costs ($1,000,000 + $700,000 + $500,000) | 2,200,000 | |Operating income (from requirement 1) |$1,300,000 | * solve backwards for revenues Selling price = [pic]$12 per case. Markup % on full cost Full cost = $2,500,000 + $2,200,000 = $4,700,000 Unit cost = $4,70 0,000 ? 500,000 cases = $9. 40 per case Markup % on full cost = [pic]27. 66% 3. Budgeted Operating Income | |For the year ending December 31, 20xx | |Revenues ($14 [pic] 475,000 cases*) |$6,650,000 | |Variable costs ($5 [pic] 475,000 cases) | 2,375,000 | |Contribution margin |4,275,000 | |Fixed costs | 2,200,000 | |Operating income |$2,075,000 | *New units = 500,000 cases[pic]95% = 475,000 cases Return on investment = [pic]15. 96% Yes, increasing the selling price is a good idea because operating income increases without increasing invested capital, which results in a higher return on investment. The new return on investment exceeds the 10% target return on investment. 12-31(20 min. )Cost-plus, time and materials, ethics. 1. As shown in the table below, Garrison will tell Briggs that she will have to pay $460 to get the air conditioning system repaired and $440 to get it replaced. |COST |Labor |Materials |Total Cost | |Repair option (5 hrs. [pic] $30 per hr. $100) |$150 |$100 |$250 | |Replace option (2 hrs. [pic] $30 per hr. ; $200) | 60 | 200 | 260 | |   | | |   | |PRICE (100% markup on labor cost; 60% markup on materials) |Labor |Materials |Total Price | |Repair option ($150 [pic] 2; $100 [pic] 1. 6) |$300 |$160 |$460 | |Replace option ($60 [pic] 2; $200 [pic] 1. 6) | 120 | 320 | 440 | 2. If the repair and replace options are equally effective, Briggs will choose to get the air conditioning system replaced for $440 (rather than spend $460 on repairing it). 3. RC Mechanical will earn a greater contribution toward overhead in the repair option ($210 = $460 – $250) than in the replace option ($180 = $440 – $260). Therefore, Garrison will recommend the repair option to Briggs which is not the one she would prefer. Recognizing this conflict, Garrison may even present only the repair option to Ashley Briggs. Of course, he runs the risk of Briggs walking away and thinking of other options (at which point, he could present the replace option as a compromise). The problem is hat Garrison has superior information about the repairs needed but his incentives may cause him to not reveal his information and instead use it to his advantage. It is only the seller’s desire to build a reputation, to have a long-term relationship with the customer, and to have the c ustomer recommend the seller to other potential buyers of the service that encourages an honest discussion of the options. The ethical course of action would be to honestly present both options to Briggs and have her choose. To have their employees act ethically, organizations do not reward employees on the basis of the profits earned on various jobs. They also develop codes of conduct and core values and beliefs that specify appropriate and inappropriate behaviors. 12-32(25 min. )Cost-plus and market-based pricing. 1. California Temps’ full cost per hour of supplying contract labor is Variable costs$13 Fixed costs ($168,000 ? 84,000 hours) 2 Full cost per hour$15 Price per hour at full cost plus 20% = $15 ( 1. 20 = $18 per hour. 2. Contribution margins for different prices and demand realizations are as follows: | | |Contribution Margin per | | | | |Variable Cost per Hour |Hour |Demand in Hours |Total Contribution | |Price per Hour |(2) |(3) = (1) – (2) |(4) |(5) = (3) ? 4) | |(1) | | | | | |$16 |$13 |$3 |124,000 |$372,000 | |17 |13 |4 |104,000 |416,000 | |18 |13 |5 |84,000 |420,000 | |19 |13 |6 |74,000 |444,000 | |20 |13 |7 |61,000 |427,000 | Fixed costs will remain the same regardless of the demand realizations. Fixed costs are, therefore, irrelevant since they do not differ among the alternatives. The table above indicates that California Temps can maximize contribution margin ($444,000) and operating income by charging a price of $19 per hour. 3. The cost-plus approach to pricing in requirement 1 does not explicitly consider the effect of prices on demand. The approach in requirement 2 models the interaction between price and demand and determines the optimal level of profitability using concepts of relevant costs. The two different approaches lead to two different prices in requirements 1 and 2. As the chapter describes, pricing decisions should consider both demand or market considerations and supply or cost factors. The approach in requirement 2 is the more balanced approach. In most cases, of course, managers use the cost-plus method of requirement 1 as only a starting point. They then modify the cost-plus price on the basis of market considerations—anticipated customer reaction to alternative price levels and the prices charged by competitors for similar products. 12-33Cost-plus and market-based pricing. 1. Single rate = [pic] $11. 91 per test-hour (TH) Hourly billing rate for HTT and ACT = $11. 91[pic]1. 45 = $17. 27 2. Labor and supervision = [pic]= $4. 64 per test-hour Setup and facility costs = [pic]= $503. 275 per setup-hour Utilities = [pic]= $36. 80 per machine-hour (MH) 3. |HTT |ACT |Total | |Labor and supervision |$295,104 |$196,736 |$ 491,840 | |($4. 64? 63, 600; 42,400 test-hours)1 | | | | |Setup and facility cost |100,655 |301,965 |402,620 | |($503. 275? 200; 600 setup-hours)2 | | | | |Utilities | 184,000 | | | |($36. 80? ,000; 5,000 machine-hours)3 | |184,000 |368,000 | |To tal cost |$579,759 |$682,701 |$1,262,460 | |Number of testing hours (TH) |? 63,600 TH |? 42,400 TH | | |Cost per testing hour |$9. 12 per TH |$ 16. 10 per TH | | |Mark-up | ? 1. 45 | ? 1. 5 | | |Billing rate per testing hour |$ 13. 22 per TH |$ 23. 35 per TH | | | | | | | 1106,000 test-hours [pic] 60% = 63,600 test-hours; 106,000 test-hours[pic]40% = 42,400 test-hours 2800 setup-hours ? 25% = 200 setup-hours; 800 setup-hours ? 75% = 600 setup-hours 310,000 machine-hours ? 50% = 5,000 machine-hours; 10,000 machine-hours ? 50% = 5,000 machine-hours The billing rates based on the activity-based cost structure make more sense. These billing rates reflect the ways the testing procedures consume the firm’s resources. 4. To stay competitive, Best Test needs to be more efficient in arctic testing. Roughly 44% of arctic testing’s total cost [pic] occurs in setups and facility costs. Perhaps the setup activity can be redesigned to achieve cost savings. Best Test should also look for savings in the labor and supervision cost per test-hour and the total number of test-hours used in arctic testing, as well as the utility cost per machine-hour and the total number of machine hours used in arctic testing. This may require redesigning the test, redesigning processes, and achieving efficiency and productivity improvements. 12-34(25–30 min. )Life-cycle costing. 1. Total Project Life-Cycle Costs | |Variable costs: | | | Metal extraction and processing ($100 per ton ? 50,000 tons) |$5,000,000 | |Fixed costs: | | | Metal extraction and processing ($4,000 ? 24 months) |96,000 | | Rent on temporary buil dings ($2,000 ? 7 months) |54,000 | | Administration ($5,000 ? 27 months) |135,000 | | Clean-up ($30,000 ? 3 months) |90,000 | | Land restoration |475,000 | | Selling land | 150,000 | |Total life-cycle cost |$6,000,000 | 2. Projected Life Cycle Income Statement | |Revenue ($150 per ton [pic] 50,000 tons) |$7,500,000 | |Sale of land (plug after inputting other numbers) |500,000 | |Total life-cycle cost | (6,000,000) | |Life-cycle operating income ($40 per ton ? 50,000 tons) |$2,000,000 | Mark-up percentage on project life-cycle cost = [pic] [pic] = 33? % 3. |Revenue ($140 per ton [pic] 50,000 tons) |$7,000,000 | |Sale of land | 400,000 | |Total revenue |$7,400,000 | |Total life-cycle cost at mark-up of 33? % |$5,550,000 | |($7,400,000 ? 1. 33333) | | |New Life would need to reduce total life-cycle costs by |$ 450,000 | |($6,000,000 – $5,550,000) | | |Check | | |Revenue |$7,000,000 | |Sale of land |400,000 | |Total life-cycle cost |(5,550,000) | |Life-cycle operating income |$1,850,000 | |Mark-up percentage = [pic]= 33? | | 12-35  (30 min. ) Airline pricing, considerations other than cost in pricing. 1. If the fare is $500, a. Air Eagle would expect to have 200 business and 100 pleasure travelers. b. Variable costs per passenger would be $65. c. Contribution margin per passenger = $500 – $65 = $435. If the fare is $2,100, a. Air Eagle would expect to have 180 business and 20 pleasure travelers. b. Variable costs per passenger would be $175. c. Contribution margin per passenger = $2,100 – $175 = $1,925. Contribution margin from business travelers at prices of $500 and $2,100, respectively, follow: At a price of $500: $435 ? 200 passengers = $ 87,000 At a price of $2,100: $1,925 ? 180 passengers= $346,500 Air Eagle would maximize contribution margin and operating income by charging business travelers a fare of $2,100. Contribution margin from pleasure travelers at prices of $500 and $2,100, respectively, follow: At a price of $500: $435 ? 100 passengers= $43,500 At a price of $2,100: $1,925 ? 20 passengers= $38,500 Air Eagle would maximize contribution margin and operating income by charging pleasure travelers a fare of $500. Air Eagle would maximize contribution margin and operating income by a price differentiation strategy, where business travelers are charged $2,100 and pleasure travelers $500. In deciding between the alternative prices, all other costs such as fuel costs, allocated annual lease costs, allocated ground services costs, and allocated flight crew salaries are irrelevant. Why? Because these costs will not change whatever price Air Eagle chooses t How to cite Variable Cost and Contribution Margin, Essay examples

Nora Helmer of in Ibsens A Dolls House Dolls Hou Essay Example For Students

Nora Helmer of in Ibsens A Dolls House Dolls Hou Essay se essaysNora Helmer of A Dolls House Nora Helmer in a A Dolls House is a women ahead of her time. In order to protect her children from a false life, she inflicts tragedy upon herself by leaving everything she has by walking away. She puts herself in this tragic situation by not being honest. Nora lies to herself and the ones she cares about. Before she leaves her life is not her own person she is carrying on life as a role. Making others happy, instead of herself. A Dolls House by Henrik Isben is about a young woman and her life. The main characters name is Nora Helmer. She is married to a bank manager named Trovald. In the early years of their marriage just after their first child Trovald becomes ill. Doctors say that he will not live unless he goes abroad immediately. Nora takes it upon herself and borrows two hundred and fifty pounds from a money leader named Krogstad. She was dishonest with Trovald and said her father gave it to her. It was illegal because she forged her dying fathers signature on the document. Nora was unlike most women of her time period. Most women would be afraid to do the things Nora did. In the end of the play A Dolls House after the truth has been discovered about Nora she makes a very courageous decision. It was not heard of for a woman to leave her family , but Nora did. She did this because she knew if she stayed with the children it would not be fair for them. She was not best mother for her children even though she loved them like ant mother loves her children. When we learn that the model for Nora was intelligent and ambitious everything falls in to place. There is no need to wonder about motivation or changes of character sudden revelations (Hardwick). Nora is very wise in many of her ways. She planned to perform a dance at a ball just to dictract Trovald. When all the truth is discovered at the end of the play things become very tense between Nora and Trovald. In the raging depate over the morality of Noras behavior , however, it is all too easy to neglect Trovalds dramatic function in the play (Kashdam). After the ball, Trovalts rage and anger, e calls Nora a hypocrite, liar, and a criminal. He says she has no religion, morality, or sence of duty. Then as always he confesses his love to her and wants to take care of her. In the final dramatic scene of the play she explains to Trovalt that she feels like his little doll in a doll house. She leaves and wants no contact with Trovalt or children. Nora wants to begin a new life. All through out her marriage, she was not who she wanted to be, she was the perfect image of a wife. She walks away feeling excited, yet inside, is full of tragedy, and full of pride.

Innovation Business Education in Emerging Markets

Question: Discuss about theInnovation for Business Education in Emerging Markets. Answer: Introduction Variations make things beautiful and interesting. The idea not only applies in every aspects of life and that includes business as well. Once a businessperson makes innovation and brings positive changes, in the business, the business will soar high. Companies bring innovation for various reasons. Some does not want the business to be monotonous, while some want to rectify past failures and mistakes (Amit, Zott, 2012). However, the path of innovation is not easy. The company has to face certain issues and barriers. The company has to overcome the issues and brings in the changes in the organization. It is important that the organizations plan the innovation intelligently (Schaltegger, Ldeke-Freund, Hansen, 2012). If the innovation is brought after some problems faced by the company, the organization should take extra care and before any innovation in the organization (Onetti, Zucchella, Jones, McDougall-Covin, 2012). The following report will mainly evaluate the functions of Toyota in the art of New Zealand. It will look into the changes brought into by Toyota, the innovation model followed by Toyota. The barriers that came in the path of the innovation and the process of overcoming the issues will also be studied. The write-up will help the readers in knowing the importance of innovation and the issues that will come in the path of innovation. Issues that will Influence Performance Toyota has been facing issues regarding the recall from the New Zealand market ("About Toyota", 2016). In the year 2015, 420 vehicles were recalled from the market, which included Voltz and Pronard models that were manufactured in the year 2001 and 2004 ("Precautionary recalls announced for Toyota vehicles", 2016). The model had to be recalled mainly because of the faulty airbags. The models were dated to be recalled in the year 2013. However, Toyota stopped the certain models when they found there are still chances of recall due to the same reason. The vehicles had to recall mainly because of the faulty spiral cable, seat rail, steering column bracket for the new vehicles that have been introduced in the market by Toyota. The new models that were affected are the RAV4, Prado, Gulux, Belta, Ist, Ractis, Vitz and Yaris. Toyota Ractis is one of the imported models that are being affected due to the faulty parts ("Toyota New Zealand issues recall for 420 vehicles - Business - NZ Herald News", 2016). The part that is affected in the imported models is the drain outlet. Toyota has taken measures to give the customers proper services so that do not have to face any issue in the future. Toyota has understood if they had evaluated the problems beforehand and has taken measures that do not have to recall any of the vehicles. However, to handle the customers, Toyota has sent the notification letter to the customers and advised them to contact the dealer. The repair will be free for the customers and will be done within duration of one to three hours. Innovation to Tackle the Issues As Toyota has been facing issues, it is time for the company to implement innovations in their models as well as their business. The electric car is one of the famous ventures of Toyota that it could implement in New Zealand. The models of Toyota has been facing issues and had to be recalled due to the faulty parts from the market of New Zealand. Toyota has already made a bad impression on the minds of the people due to the faulty parts in the models for which they had to recall the cars. The electric cars will be environmental friendly and will help the company to maintain their environmental sustainability. To implement the innovation, Tuckers innovation model will help the organization to implement the products in a better manner. Figure 1: Tuckers innovation model (Source: Tucker, 2001) The tuckers innovation model talks about the fact that innovation is a continuous process. The model talks about eight building blocks of innovation. The blocks are: Innovation strategy and definition Leading and championing innovation Resource allocation Developing innovation skills Management rewards and metrics Cultivating the culture Involving the whole enterprise Collaborating with the customers and stakeholders The electric cars will be the innovation strategy for the change that Toyota will be making in the market. However, if Toyota wants to launch a new model, the company should know the techniques and should be a champion in that innovation. To implementation the new types of car, the resources should be allocated well. Toyota needed to hire people who know the mechanism well as these kinds of people will help the organization to innovate the new products. The employees need to be rewarded once the new product will launched in the market (Halme, Lindeman, Linna, 2012). The management should reward the employees who will be the main force behind the work and they should. Innovation the product and launching it in the market will not help the organization, they should keep a constant follow up on the performance of the products in the market (Bock, Opsahl, George, Gann, 2012). The entire organization should be involved in the launch of the electric car. The employees who are not directl y involved in the project should take part in the innovation so that they are regularly updated with the happenings in the company (Boons, Ldeke-Freund, 2013). Educating the entire population of the organization will help the organization for facing the future challenges. To launch a new product, the issues that will rise are in the financial part (Amit, Zott, 2012). The company will need interested stakeholders who will help the organization in the launching of the car. The new car will help in attracting the customers who have drifted away due to the faulty car parts in the Toyota models. The electric car will be help in the sustainability of the environment, as it will not use petrol. It is expected that the people who are living in the country will accept it even after the issues if faulty parts. Implementation of the Innovation The implementation of the new innovation of the electric car model in the New Zealand market was not that easy as the customers were not familiar with this type of vehicle so there was some type of risks. The company Toyota has entered the marketed with the premium quality luxurious electric vehicles and standard range of vehicles. The main advantage that the company Toyota possessed is a house of best expertise in the Research and Development laboratories. The labs have developed powerful batteries for the cars and latest re charging technology, which is a very important thing that will help the company to gather a large market share for the product (Alon, Jones, McIntyre, 2013). The main motive of Toyota is to make this car more popular as there as there will be lower pressure on the conventional resources like the fossil fuel. The pollution emitted by the cars will also be minimized in the process. The company Toyota to make the use of the electric cars common among people has de cided on building a network of charging stations around the world. The recharge will help to deliver charge of 200 miles for half an hour (Toda, Salazar, SaitoÃÅ'„, 2013). The main reason for this is that the there are charging stations that take several hours to charge. The customer who has purchased the product was wooed by this innovation, as there was no need for them to visit the gas station. The cost of recharging the car was just a few dollars. The electric cars also needed a single gear for driving at all type of speeds, which was undoubtedly powerful, and surprising (Clausen, Ten Hompel, Meier, 2014). There is a need of gasoline and there is no emitting of polluted gases. It is expected that the whole process of manufacturing until the time of the disposal the electric cars they tend to produce 40% lesser carbon ozone and carbon dioxide than that of the conventional cars. Since the company has come with an innovative model, there is a greater possibility that it wo uld be receiving subsidies by the government due to their innovative idea and promotion (Toda, Salazar, SaitoÃÅ'„, 2013). The company has studied from the market research that New Zealand market has a huge demand for the electric cars. There is a no need for the customers to make huge maintenance cost (Tellis, 2013). There is a no need for the customers to lubricate the engine from time to time so that the engine functions properly. Identification of the Barriers in Path of Innovation: The innovation by Toyota was not that easy as there are a number of barriers that the company has to confront in order to achieve success in the New Zealand market. The company undoubtedly possessed excellent innovation methods yet it was difficult for it to make a position in the market of electric cars (Caldwell, 2012). Some of the renowned branded car companies like General Motors, BMW, Mercedez Benz, Ford and Tesla Motors dominate the electric car market. The expertise that Toyota Company had was not same as that of rival companies. This has made it difficult to market the products to the customers (Michelini, 2012). Apart from the designing the model of the electric cars, there is a need for the development of the electric fuelling stations in almost in all the famous locations and the remote places where the customers drive with their cars. When the customers they drive for a long trip and there is no charge in the car a lack of fuel station will keep the passenger stranded (Ferrara LaMeau, 2012). The electric cars are not much in demand by the younger population as they are more fascinated by the fuel based powered engines. It is expected by them that the use of the electric cars have lesser performance than that of the fuel-enriched cars (Ferrara LaMeau, 2012). The electric cars would not give the speed that is provided by the fuel-based engines. The electric cars are only based on the electricity as a source of power. There is a need for the customers to make their decision of purchases prior to making the investment. The electricity is not freely available but there is some cost that is incurred by the purchasers on electricity. The innovation of the electric cars is undoubtedly great but the mileage that the car provides is not that great. The electric cars have a limited range and speed. The maximum speed ranges from 50 to 100 miles and there is a need to recharge them again and again. Driving for the purpose of long distances is no suitable for this type of cars (McCrorey, 2012). There is a need for overcoming this setback. The recharge time is also longer in the electric vehicle. The electric cars take 4 to 6 hours to recharge fully unlike the fuel cars that recharges within a couple of minutes from the time of recharge. Thus, with innovation of the electric car model, the company Toyota faces a number of innovations disadvantage. Overcoming the Barriers The company Toyota has a number of barriers that they have to overcome. The company needs to hire excellent expertise men so that they are able get the maximum advantage from the innovation. Hiring of the expertise can be done when they are given a much higher salary than that of the other competitor organization like the company General Motors, Ford and BMW. The company Toyota should not only invest in the manufacturing of the cars but also invest in the building up of the fuel station in a number of locations. The customers will then be eager to buy this car but the only fear that they posses is that is they run out of charge where they get to charge their electric cars. The company Toyota should treat developing the Electric stations and electric cars complementary so that they are able to attract more number of customers for their product. The main aim of the company Toyota is to attract the demand of the younger population of New Zealand as they have immense craze for different models of the cars but the only thing that the company should do is to increase the power of the electric cars as this the factor that the young customers they look out for. The battery of the cars must be powerful like that of the fuel-efficient cars (May, 2012). The electric cars manufactured by Toyota is based only on electricity which is a disadvantage for the company as they would be getting customers who prefer only electric cars. The electric cars should also have the option of fuel. This will help in attracting all range of customers. The availability of electricity is not always certain so keeping the availability of both the energy-based option will be able to give more number of customers. This would satisfy the all type of customer demand. The company Toyota should collaborate with the government so that they are able to provide efficient cars (McCrorey, 2012). The cars manufactured will have the government sanction and this will help in increasing the demand of the customers. The authenticity by the government is a guarantee, which the customers consider in buying the product (Macaulay, 2012). There is a need for the company Toyota to set up after sales services for the cars sold. The service centers should be available in all the main cities of New Zealand. There should be provision of free services for the whole one year after the purchase of the electric services. All sorts of damage need to be covered under the after sales service of the customers. Conclusion Innovation is an integral part of the business. There is a need for all company to understand that with innovation to gain success. Incorporating innovation in business is very important, as there is a need for the company is change as per the demand of the customers and the changing environment. The company Toyota before the implementation of innovation in the product must consider the review of the customers. The company Toyota had a very rough journey in New Zealand as there are feedbacks from the customers regarding the faulty steering, seat rail, spiral cable in many of the cars. This has resulted in the loss of a large market share in New Zealand. The company Toyota also wanted to revive itself in the New Zealand car market so they have come up with the strategy of incorporating the Tucker innovation model in the manufacturing of the electric car. The innovation model will be able to help in the efficient allocation of the resources for the company Toyota. This would help in co llaborating the stakeholders and the customers. 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