Part 1: Generalize how a breakeven point is calculated and summarize its purpose and function in organizational financial decision-making. Explore how managerial decision-making relating to fixed cost and variable cost issues might affect the breakeven point for an organization.
Part 2: Demonstrate how ROI is used to quantify organizational performance. Using the company reporting resources from prior weeks https://www.annualreports.com/ (Links to an external site.), compare and contrast ROI between two companies in the same field (example: Uber/Lyft, Samsung/Sony, Apple/IBM). Based on the ROI data obtained, explain why one company’s ROI is “better” than the other company’s ROI, and hypothesize how managerial decision-making factors within each organization may have impacted ROI.
Part 3: Complete the Woodbridge Manufacturing Case study in Fields Appendix E (pg. 279) that provides a comprehensive overview of using the discounted cash flow technique to analyze an investment opportunity. Based on the data provided in this case study and the calculated ROI, do you consider this company to be a good investment? What risk/opportunity areas should be considered to ensure continued ROI growth in the coming year/years?
The book is call “The Essentials of Finance and Accounting for Nonfinancial Managers” page 279 Woodbridge Manufacturing Case study in Fields Appendix E