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ACCT3002 Advanced Management Accounting- Social and Environmental Factors

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ACCT3002 Advanced Management Accounting

Task:

A. Calculate the annual running cost of the two plants, return on investment (ROI) and evaluate which seems more efficient from a financial perspective. [10 marks]

B. What social and environmental factors might you also consider in assessing which plant should be retained (please list 3 in total)? What would be your final recommendation? [5 marks]

C. Use lean principles to identify two (2) potential improvements to their business operations that could add value to the company and its customers. Clearly state the improvement and the value/benefit it could deliver. [5 marks]

Required: 

A. Determine the operating income for each division and for the company as a whole if the transfer price from Computer Services to Management Advisory Services is $45 per hour and the transfer price from Management Advisory Services to Computer Services is $60 per hour. [10 marks]

B. The manager of Computer Services has found another company willing to provide the same services as Management Advisory Services at $50 per hour. All of the employees in both units are guaranteed 40-hour work weeks. Currently, Management Advisory Services has idle capacity because of an economic downturn. Calculate the change in operating income for the entity as a whole if Computer Services uses outsourced services instead of using Management Advisory Services. [5 marks]

C. Recommend a transfer price policy that would provide incentives to use the internal services. Explain your recommendation. [5 marks]

Required:

A. Prepare a report addressed to the CEO at StarTV detailing your proposed new incentive and remuneration plans for the three main tiers (groups) of employees (executive, middle management & operations) to motivate them to better meet the strategic goals of the organisation?

Your report should include:
i. A discussion explaining to the CEO explaining the underlying principles that must be considered in drafting an incentive and remuneration package at StarTV. [5 marks]

ii. Identify potential goals for each group of employee aligned with the organisation’s strategy provided in the question. [5 marks]

iii. Provide a recommendation on the suggested incentive and remuneration structure and measures for each group of employees that aligns with the strategy of the organisation. [5 marks]

ACCT3002 Advanced Management Accounting

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