管理会计代写 Wellington Regional Events Corporation (WRE).

Wellington Regional Events Corporation (WRE).

管理会计代写 I would advise against that. The $1,100,000 in facility depreciation at the Lambton Quay (Central Wellington) location is misleading

Wellington Region

Financial Performance

Events Coordination Centres

Total               Porirua           Newlands         Lambton

Quay

(Central

Wellington)

_________

*Includes building rental expense for the Porirua, and Newlands locations and building depreciation for the Lambton Quay (Central Wellington) location.

• Local administrative expenses are the administrative expenses incurred at the event coordination centres. ^Regional administrative expenses are allocated to the events coordination centres based on sales.  管理会计代写

¥Corporate administrative expenses are charged to segments of the company such as the Wellington Region and the events co-ordination centres at the rate of 9.5% of their sales.

Upon seeing this report, Ms Mahan summoned Foon Chang for an explanation.  管理会计代写

Mahan:Lambton Quay (Central Wellington)  previous year, did it?

Chang:No, the Lambton Quay (Central Wellington) facility has had a nice profit every year since it opened six years ago, Lambton Quay (Central Wellington) lost a big contract this year.

Mahan:Why?  管理会计代写

Chang:One of our national competitors entered the local market and bid very aggressively on the       contract.  We  could  not  afford  to  meet  the  bid.  Lambton  Quay  (Central Wellington)       particularly their facility expenses     are just too high. When Lambton  Quay  (Central Wellington)  lost the  contract, we had to  lay off a  lot  of employees, but we could not reduce the fixed costs of the Lambton Quay (Central

Mahan:Wellington) facility.

Chang:Why is Lambton Quay (Central Wellington)            facility than either Porirua or Newlands and yet its facility expense is higher.

Mahan:The problem is that we are able to rent suitable facilities very cheaply at Porirua and Newlands. No such facilities were available at Lambton Quay (Central Wellington); we had them built. Unfortunately, there were big cost overruns. The contactor we hired was inexperienced at this kind of work and in fact went bankrupt before the project was completed. After hiring another contractor to finish the work, we were way over budget.

Chang:The large depreciation charges on the facili have much competition at the time and could charge premium prices.  管理会计代写

Mahan:Well,Lambton Quay (Central Wellington) facility will obviously have to be shut down.Its business can be shifted to the other two events coordination centres in the region.

Chang:I would advise against that. The $1,100,000 in facility depreciation at the Lambton Quay (Central Wellington) location is misleading, that facility should last indefinitely with proper maintenance, and it has no resale value; there is no other commercial activity around Lambton Quay (Central Wellington).  管理会计代写

Mahan:What about the other costs at Lambton Quay (Central Wellington)?  管理会计代写

Chang:If we shifted Lambton Quay (Central Wellington)events coordination centres  save anything on direct labour or variable overhead costs. We might save $90,000 or so in local administrative expense, but we would not save any regional administrative expense and corporate headquarters would still charge us 9.5% of our sales as corporate administrative expenses.  In addition, we would have to rent more space in Porirua and Newlands in order to handle the work transferred from Lambton Quay (Central Wellington); that would will cost us something to move the  equipment  from  Lambton  Quay (Central Wellington)  to Porirua  and Newlands. And the move will disrupt service to clients.

Mahan:I  understand  all  of that,  but  a  money-losing  events  coordination  centre  on  my performance report is completely unacceptable.

Chang:And if you shut down Lambton Quay (Central Wellington), you are going to throw some loyal employees out of work. unfortunate, but we have to face hard business realities.  管理会计代写

Chang:And you would have to write off the investment in the facilities at Lambton Quay (Central Wellington).

Mahan:I can explain a write-off to corporate headquarters; hiring an inexperienced contractor to build the Lambton Quay (Central Wellington) of my events coordination centres. Lambton Quay (Central Wellington) has to go. At the next  corporate board meeting, I  am  going to recommend the  Lambton  Quay (Central Wellington) facility be closed.

Required:  管理会计代写

Write a report to the management of the Wellington Regional Events Corporation (WRE) advising and recommending if the Lambton Quay (Central Wellington) events coordination centre should be closed with appropriate academic arguments, citations and using financial evidence (summary calculation) where appropriate. In your report answer requirements 1, 2 and 3 to inform your arguments and propose suitable recommendation/s. Use headers and sub- headers (you can use sub-sub-header under the  sub-header) to ensure the flow of logical arguments.  Round all calculations to the nearest dollar.

Note: Your report should be based on sound academic reasoning with evidence / citations from academic journals, explaining and analysing the major concepts  on which you base your arguments and the corresponding calculations. Include only the most important calculations as a check figure in your report. Provide detailed calculations in the appendix and when including check figure calculations in your content, remember to refer to the appendix for detailed calculations.  管理会计代写

Requirements to address in your report:

1. 1.Basedon the financial perspective only and from the standpoint of the Wellington Regional Events Corporation (WRE) should Lambton Quay events coordinating centre be closed down.  Discuss and analyse the financial advantage and/or disadvantages of closing  the  Lambton  Quay  (Central  Wellington)  events  coordinating  centre  and redistributing its work to other events coordinating centres in the region? Explain with supportive analysis and check figures from calculations.


2. Analyseand  discuss  using  constructive  academically  based  arguments  and  your calculations why might it be in Manu Mahan  -interest to shut down the Lambton Quay (Central Wellington) facility? Do you think Manu Mahan is conducting herself in an ethical fashion? Explain and analyse using academic arguments.  管理会计代写


3. 3.Whatinfluence should the depreciation on the facilities at Lambton Quay (Central Wellington) have on prices charged by Lambton Quay (Central Wellington) for its services? Discuss and analyse, making sure you include the check figure calculations.

Based on the discussion and analysis of the above 3 issues provide suitable recommendation/s to the management of WRE.

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