Accounting Analysis Essay

Michael Burton has recently been leased as the CEO of Tesca kit and boodle, Inc. Previously he had been the marketing manager for a large manufacturing company and had established a reputation for identifying juvenile consumer trends. Tesca Works Inc. is a California-based generator manufacturing company. The company is well known for manufacturing large, heavy generators at a reasonable be. One of its greatest achievements is that its generators can be easily modified or customized for different applications. Also, Tesca Works soon builds commercial appliances.The company is considering an expansion of its current product line to take refrigerator and maybe, sometime in the future, consumer appliances. Mr. Burton feels that due to high energy prices, consumers will be more automatic to consider purchasing new efficient appliances.See more Beowulf essay essayTesca Works Inc. is a California-based generator manufacturing company. The company is well known for its innovation a nd ability to produce high quality products at a reasonable cost. One of its greatest achievements is that its manufacturing processes are adaptable to other durable goods. Also, Tesca Works currently builds commercial appliances.Profile of Tesca Works Tesca Works, Inc. was established by the Smith brothers in 1880 as the Logging aphorism Company. The firm started manufacturing large steam saws to serve the logging assiduity which processed lumber. Their customers were construction companies that provided housing for the creation increase in California. The Smith brothers quickly realized that the times were changing. They started looking for the technologies that would keep them at the headland of their field of business. In 1915, the Smith brothers decided that they requisite to make generators as replacements for the saws. They realized that the logging industry was not viable anymore and that generators were starting to serve the same purpose.The company started making gene rators in the first 1940s. Tesca Works then opted to produce commercial appliances. It was an easy decision to make since the commercial appliances would use common land parts with the companys generators and the customers were local hospitals, schools, and governments. Starting in the 1950s the commercial appliances business accounted for round 50% of Tesca Works revenues.The Refrigerator Mr. Burton arranged a meeting with the firms top solicitude and the chief design and the chief manufacturing engineers to propose a new product. Mr. Burton presented an argument that more individuals in the linked State and Canada would be willing to purchase newer appliances because tribe are becoming more environmentally conscious. The new appliances are more efficient and environmentally friendly. Also, the recent increase in electricity costs seems to be long lasting. This is an opportunity to institute slew hooked on environmentally friendly appliances as he put it.The proposal under consideration is for the introduction of a new, energy star refrigerator. To distinguish Tesca Works from other manufacturers, the proposal included details ab prohibited the convenience, large shelves in the doors, high volume irrigate and ice dispensers, efficiency, and quietness of operation that need to be developed.Mr. Phillips and Mr. Lopez, the two engineers, enthusiastically and quickly pointed out that the needed technology could be based on the companys generators. The framework currently used for structure the generators can be modified to work for appliances at a low cost. The marketing vice president, Mr. Chen, pointed out that the marketing analysis could be done quickly and at a reasonable cost. At this point, Mr. Burton charged the participants in the meeting to produce a financial plan for the development and production of the refrigerator.Consumer Appliances Most people purchase appliances and keep them for a very long time or until they stop working. Some get t hem when they purchase a home and do not think about them.Recently, most power companies started educating people about the efficiency of new appliances and began offering rebates on the most efficient consumer models. These approaches increased public interest. This regenerate the publics interest in low power-consuming appliances.The Decision Three weeks later, the vice presidents presented the sales and cost forecasts shown in the exhibits. The information presented contains the cost of production, financing information, and warranty cost estimates. In addition, there were two options for the compressor in the refrigerators. The MC 004 is more expensive to install, but has a lower warranty cost. The TS L12 is cheaper to install, but has a higher(prenominal) warranty cost. Which compressor should be used?