1. Which of the following is NOT an action company co-managers can take to help meet or beat the investor-expected increases in the company’s stock price in upcoming years?
- Making its company practice to issue additional shares of stock each year and use the proceeds to pay down the debt outstanding until the company’s debt-equity percentages reach 20% or lower for debt and 80% or more for equity
- Increasing annual dividend payments to shareholders most every year
- Making it a frequent management practice to allocate a portion of internal cash flows from operations to repurchasing shares of the company’s common stock
- Putting increased attention on boosting operating profits in all four geographic regions –the resulting growth in operating profits companywide will act to increase total net profits and EPS; higher earnings per share are an important driver of the company’s stock price
- When the company’s stock price drops because of unexpectedly weak company performance in the prior year but is expected to recover and rise in the next several decision rounds opting to borrow money preferably in the form of 1-year loans from the Global Community Bank (but not so much as to impair the company’s credit rating) and using the borrowed funds to repurchase outstanding shares of common stock
2. Which of the following is NOT an action company co-managers can take that has good potential for increasing the company’s average ROE and helping the company meet or beat the investor expected ROE targets in upcoming years?
- Pursuing efforts to boost total operating profits in all four geographic regions — the resulting growth in operating profits companywide will increase total net profits (a company’s net profi tare the numerator in calculating the company’s ROE)
- Paying a small annual dividend to shareholders (less than $0.50 per share) which is increased annually by about $0.05 per shares; a small but growing dividend provides the company with more cash to fund capital expenditures and/or pay down bank borrowings ahead of schedule
- Using a portion of the company’s internal cash flows from operations for the next several years to repurchase shares of common stock
- Borrowing money from the Global Community Bank (preferably in the form of a 1-year loan that can be fully or mostly repaid the following year) and using the proceeds to repurchase outstanding shares of common stock: such action makes considerable financial sense when the company’s stock price is expected to rise substantially in future years and/or when unexpectedly weak company performance in the prior year causes a drop in its stock price
- Increasing annual dividend payments to shareholders (because all net profits not paid out as dividends are treated as retained earnings and because bigger retained earnings have the effect of increasing shareholders equity
3. Which one of the following is NOT a way to improve the P/Q rating of a company’s brand of action-capture cameras?
- Adding one or two more extra performance features
- Increasing the image sensor size and the resolution of the LCD display screen
- Increasing expenditures for camera R&D
- Spending several more dollars on the camera housing and on included accessories
- Increasing the number of models in the company’s lineup of multi-featured cameras
4. If a company pays each camera PAT member a base wage of $21,000, thereby resulting in base wages of $84,000 per 4-person PAT, and if camera PATs work an average of 2,000 hours per year to assemble 3,000 cameras annually, it follows that
- the hourly base wage cost for a PAT to assemble a camera would be $30.00 and that the labor cost of assembling a camera at overtime would be $60.00 per PAT.
- the hourly base wage cost for a PAT to assemble a camera would be $28.00 and that the labor cost of assembling a camera at overtime would be $42.00 per PAT.
- the hourly base wage cost for a PAT to assemble a camera would be $24.00 and that the labor cost of assembling a camera at overtime would be $36.00 per PAT.
- the hourly base wage cost for a PAT to assemble a camera would be $10.50 and that the labor cost of assembling a camera at overtime would be $15.75 per PAT.
- the hourly base wage cost of assembling a camera would be $28.00 and that the labor cost of assembling a camera at overtime cannot be determined from the available information due to the lack of information about compensation payments for assembly quality incentives. perfect attendance bonuses, and the cost of fringe benefit packages
5. Actions that can lead to higher labor productivity in assembling cameras/drones do NOT include
- increasing the annual bonus for perfect attendance paid to cameraidrone PAT members from $800 to $875.
- reducing the number of camera/drone models being assembled.
- boosting the minimum number of cameras/drones that camera/drone PATs are expected to assemble each week — such failure to achieve the weekly quota in as many as 4 weeks a year constitutes automatic disqualification for year-end perfect attendance bonuses.
- increasing total annual compensation per camera/drone PAT member by a minimum of 2% and a maximum of 5% annually.
- increasing annual expenditures to train camera/drone PATs in best practice assembly methods and ways to improve productivity from S2.000 per PAT to $2,250 per PAT
6. The website prices virtually all companies in the industry charge Asia-Pacific buyers for UAV drones are likely to be higher than the website prices they charge UAV drone buyers in North America
7. After each decision round, company managers should make a point of examining the information on p. 2 of the Company Operating Report that concerns the company’s profitability in the action camera segment in each geographic region because
8. Which one of the following actions helps boost a company’s image rating/brand reputation?
9. Which of the following combinations of actions will likely provide the LEAST competitive benefits in helping a company catch the eye of action camera shoppers. significantly boost overall buyer appeal for its cameras versus rival brands, and cause more camera shoppers to purchase its brand instead of rival brands in each of the four geographic regions?
10. If a company earns net income of $40 million in Year 8, has 10 million shares of common stock outstanding, pays a dividend of $1.00 per share, and has annual interest costs of $10 million,
11. Which one of the following is NEITHER an advantage or disadvantage of shifting to roboticsassisted camera assembly methods?
12. The industry-low, industry-average, and industry-high cost benchmarks on pp. 6-7 of each issue of the Camera & Drone Journal
13. If a company adds 60 new workstations at a cost of $75,000 each and also spends $20 million for addition space in its camera/drone assembly facilities to accommodate more workstations, then its annual depreciation costs will rise by
14. Which of the following is NOT an action that can help boost a company’s credit rating? In answering this question, you may wish to consult the Help section for page 5 of the Camera &
Drone Journal and read the discussion pertaining to “The Credit Rating Measures.”
15. The benefits of pursuing a strategy of social responsibility and corporate citizenship include
16. Which one of the following represent the MOST important/helpful results from the latest decision round that company managers need to review/study in order to guide their strategic moves and decisions to improve their company’s competitiveness and overall company performance in the upcoming decision round?
17. Which one of the following actions helps increase a company’s EPS?
18. A company’s managers should give serious consideration to changing from a low-cost/low price strategy for action cameras to a different strategy in the 4 regional markets for action cameras when
19. If your company earns an ROE of 20% at a time when the investor-expected ROE target is 25% and if the instructor-determined weight for achieving the ROE target is worth 20 points, then your company’s ROE score on the Investor Expectations scoring standard will be
20. Which one of the following is NOT an attractive way to reduce the design, assembly, marketing, and other costs per action-capture camera sold in an effort to achieve a sizable low-cost competitive advantage over rivals?