Lavell started out mowing lawns in the neighborhood when he was 13 years old. He did such good work that, without advertising, his business grew steadily each year. After college, Lavell decided to continue the business as a full-time career. One of his concerns, however, is the number of hours he is putting in. Once school lets out, he finds himself working long hours nearly every day of the week. Although he has added workers, his business now handles mowing, trimming, and landscaping for residential, corporate, and nonprofit clients. He is considering adding managers but is no quite sure how to structure the organization. Lavell wants to focus on building the business rather than doing the daily work, so he knows a decentralized structure will be best. He has asked you to develop a potential organizational chart to help him envision the best way to organize the business. Describe the advantages to this approach as well as any concerns he should have.
Want to see the full answer?
Check out a sample textbook solutionChapter 9 Solutions
Principles of Accounting Volume 2
Additional Business Textbook Solutions
Cost Accounting (15th Edition)
Financial Accounting (11th Edition)
Horngren's Financial & Managerial Accounting, The Financial Chapters (Book & Access Card)
Intermediate Accounting
Horngren's Financial & Managerial Accounting, The Financial Chapters (6th Edition)
Managerial Accounting (4th Edition)
- Staci Valek began dabbling in pottery several years ago as a hobby. Her work is quite creative, and it hasbeen so popular with friends and others that she has decided to quit her job with an aerospace company andmanufacture pottery full time. The salary from Staci’s aerospace job is $3,800 per month.Staci will rent a small building near her home to use as a place for manufacturing the pottery. Therent will be $500 per month. She estimates that the cost of clay and glaze will be $2 for each finishedpiece of pottery. She will hire workers to produce the pottery at a labor rate of $8 per pot. To sell herpots, Staci feels that she must advertise heavily in the local area. An advertising agency states that it willhandle all advertising for a fee of $600 per month. Staci’s brother will sell the pots; he will be paid acommission of $4 for each pot sold. Equipment needed to manufacture the pots will be rented at a costof $300 per month.Staci has already paid the legal and filing fees…arrow_forwardMary's job position is being transferred to Lexington, Kentucky from Orlando, Florida. She andher husband George are currently renting their home in Orlando, but they have decided that they want to purchase a home in Lexington. Mary's annual salary is $48,500. George has also beenable to find employment in Lexington at a factory making $39,000 per year. Mary is a planner and has saved $6200 that she can use towards the down payment on the new house. Use the above information to answer the following questions. Round all answers to 2 decimal places. 1. To save the down payment, Mary deposited monthly in a savings account earning 2.5% compounded monthly. If it took Mary 5 years to save up the down payment,how much money was Mary depositing each month? 2. If Mary and George don't want to spend more than 15% of theirmonthly income on their house payment, what is the maximum monthly payment they can afford?arrow_forwardAli is considering the decision of whether or not to go and study a Master degree. He is currently working as an accountant in XYZ Company. He is thinking of getting a Master Degree, If he decided to study the Master Degree, he would expect to earn higher salary than his current one. On the other hand, the study of the Master Degree would force him to take unpaid leave from his current job. Furthermore, Ali recently purchased a new car. For Ali, the cost of the car is referred to as Select one: O a. Opportunity cost O b. Sunk cost O C. Differential revenue O d. Opportunity Revenue O e. Differential costarrow_forward
- Garth Grits works as an employee at Superior Foods, a local supermarket. As an employee, Garth earns $17 per hour and works 200 hours per month. Garth currently supplements his income with the interest he earns from having $30,000 in a savings account earning 5% annual interest. Instead of continuing to work for Superior Foods, Garth would like to start up his own dollar store called Just-a-Buck located in a strip mall close to his home. If Garth starts up Just-a-Buck, he would quit his job working for Superior Foods, and he would work full-time (200 hours per month) in his new business. To set up Just-a-Buck, Garth would have to use his $30,000 savings to buy the necessary equipment and make the appropriate renovations to the mall space he plans to rent. Garth hired an accountant who estimated the annual revenue and costs of Just-a-Buck as follows: Annual Store Sales $175000 Less Annual Expenses: Mall Rent (includes utilities) $10000 Cost of…arrow_forwardMary Helu and Jason Haynes recently graduated from the same university. After graduation they decided not to seek jobs at established organizations but, rather, to start their own small business hoping they could have more flexibility in their personal lives for a few years. Mary's family has operated Mexican restaurants and taco-trucks for the past two generations, and Mary noticed there were no taco-truck services in the town where their university was located. To reduce the amount they would need for an initial investment, they decided to start a business operating a taco-cart rather than a taco-truck, from which they would cook and serve traditional Mexican-styled street food. They bought a used taco-cart for $18,000. This cost, along with the cost for supplies to get started, a business license, and street vendor license brought their initial expenditures to $22,000. They took $5,000 from personal savings they had accumulated by working part time during college, and they borrowed…arrow_forwardChris currently works for a software development firm as a programmer / analyst and earns a net salary of $65,000 per year. She is also contemplating opening her own firm (Bit-By-Bit Solutions, Inc.) and is keenly aware of the intense level of competition in her geographic market. If she opens her own firm, she will have to quit her job and use her accumulated savings of $60,000 to secure an office (1 year lease), furniture, and the necessary productive capital (PC's, Servers, Software, etc) (Note: The furniture and productive capital are purchased outright and not leased or rented). Her accumulated savings are currently earning 8 percent per year in a money market growth fund. Given her knowledge of the geographic market in which she would operate, she believes that she can secure and maintain a total of 15 accounts (firms that she produces software and consults for) at an average monthly rate of $15,000 per account per month. In order to adequately service these 15 firms, she will…arrow_forward
- Ahmed is considering his plans for the coming weekend. He is currently working as a marketing specialist in a big advertising company. He normally spends the weekend with family but this weekend he is thinking of going on a camping trip that would cost him about $1,900. At the same time, his manager asked him whether he can help during the weekend and the company will be willing to pay him an overtime bonus of $1,000. If Ahmed goes on the camping trip, he can manage to provide a number of quick consultancy services that would earn him around $2,500. If Ahmed decided to go on the camping trip what would be the incremental income of that decision ($)? O a. 600 O b. 1,000 O c. 2,500 O d. None the given answers e. 1,900arrow_forwardAhmed is considering his plans for the coming weekend. He is currently working as a marketing specialist in a big advertising company. He normally spends the weekend with family but this weekend he is thinking of going on a camping trip that would cost him about $1,000. At the same time, his manager asked him whether he can help during the weekend and the company will be willing to pay him an overtime bonus of $2,500. If Ahmed goes on the camping trip, he can manage to provide a number of quick consultancy services that would earn him around $1,900. If Ahmed decided to go on the camping trip what would be the incremental cost of that ?($) decision 900 .a O 1,900 .b O 2,500 .CO None of the given answers 1,000 e Oarrow_forwardStaci Valekbegan dabbling in pottery several years ago as a hobby. Her work is quite creative, and it has been so popular with friends and others that she has decided to quit her job with an aerospace company and manufacture pottery full time. The salary from Staci’s aerospace job is $3,800 per month. Staci will rent a small building near her home to use as a place for manufacturing the pottery. The rent will be $500 per month. She estimates that the cost of clay and glaze will be $2 for each finished piece of pottery. She will hire workers to produce the pottery at a labor rate of $8 per pot. To sell her pots, Staci feels that she must advertise heavily in the local area. An advertising agency states that it will handle all advertising for a fee of $600 per month. Staci’s brother will sell the pots; he will be paid a commission of $4 for each pot sold. Equipment needed to manufacture the pots will be rented at a cost of $300 per month. Staci has already paid the legal and fi ling fees…arrow_forward
- Between his freshman and sophomore years of college, Jack takes a job as ticket collector at a local movie theatre. Moviegoers purchase a ticket from a separate employee outside the theatre and then enter through a single set of doors. Jack takes half their ticket, and they proceed to the movie of their choice.Besides trying to earn enough money for college the next year, Jack loves to watch movies. One of the perks of working for the movie theatre is that all employees are allowed to watch one free movie per day. However, in the employee handbook it states that friends and family of employees are not allowed to watch free movies. In addition, employees must pay full price for all concession items.Soon after starting work at the theatre, Jack notices that most other employees regularly bring their friends and family to the movie without purchasing a ticket. When Jack stops them at the door to ask for their ticket, they say, “Jack, no one really follows that policy. Just be cool and let…arrow_forwardAli is currently working as a human resource manager for a company and earns a good salary. He is planning to pursue a Master of Business Administration (MBA) degree. He recently received an offer from University Awhich included the cost of tuition fees. If decided to go for the MBA study, his company would stop paying his salaryAt the same time, if Ali completed his MBA degree, he would earn a higher salary than his current one Furthermore, Ali has recently purchased an apartment in the city and moved in For when considering whether or not to go for the MBA studythe extra salary to be received after the MBA study is referred to as: Sunk cost. b. Incremental cost. c. None of the given answers , d Incremental revenue . Opportunity cost.arrow_forwardAli is currently working as a human resource manager for a company and earns a good salary. He is planning to pursue a Master of Business Administration (MBA) degree. He recently received an offer from University A, which included the cost of tuition fees. If Ali decided to go for the MBA study, his company would stop paying his salary. At the same time, if Ali completed his MBA degree, he would earn a higher salary than his current one. Furthermore, Ali has recently purchased an apartment in the city and moved in. For Ali, when considering whether or not to go for the :MBA study, the cost of tuition fees is referred to as .None of the given answers .a O .Opportunity cost b O Sunk cost .c O Incremental revenue .d O Incremental cost .e O hp 10 ho 6. 7 8 9. %3D { P. Y 9. H. Karrow_forward
- Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College