Question 1: In the context of this course, you will be asked to address the issues/questions below for The Container Store, www.containerstore.com. When addressing the issues/questions, be sure to do so in the context of this course and The Container Store. You have been appointed as the special assistant to the CEO, William Tindell, who has asked you to address the following five situations:
a) Lynn University needs new office chairs for its new building. The purchasing director at Lynn University has inquired about the “Flat Bungee Office Chair with Arms.” The regular price is $199 but the sales price is currently $149. The purchasing director has asked if 100 of these chairs could be purchased for $110. Discuss whether or not this would be feasible, as the full cost of the chairs is $130.
b) The Container Store currently sells a “Bento Salad Bowl,” which it is currentlymanufacturing in South Carolina. A representative from a company in Vietnam is offering to sell them for 15% less than the manufactured cost.
Discuss the issues that you would consider in deciding whether or not to accept. this order.
c) The CEO wishes to develop an incentive plan for the store managers. Before this is put into place, the CEO wishes you to make sure that budgeting in the stores is done correctly. He has asked you to submit a document discussing the key points that you have learned in MBA 640. Be as thorough as possible.
d) The Container Store has only used absorption costing. The CEOhas asked you to explain the merits of using variable costing under certain circumstances.
e) The CEO has asked you to explain how target costing would be used in The Container Store’s pricing policies.