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MBA, Ph.D in Management
Harvard university
Feb-1997 - Aug-2003
Professor
Strayer University
Jan-2007 - Present
ASCM 632 Homework #1 – Option 1
You have been hired as the new logistics manager for the Jones Company.
Executive management wants to understand where the company performance
stands in terms of organization financial results. They come to you to figure out
the ROA so they can understand how effective the logistics organization is in
using the assets to generate profit. You have to present your report to the
executive management team by the end of your third week in the company.
Your report will address what the key components are of a SPM and you will
create a SPM based on the below numbers.
Objectives:
1. To understand what a SPM is and what are the components of the SPM.
2. Be able to create a SPM based on a provide income statement and
balance sheet.
3. Explain how the SPM can be used to make effective logistics decisions.
Instructions: Using the reading provided concerning Strategic Profit Models and
the supplemental material, answer the below question and complete a Strategic
Profit Model for Jones Company. Cite sources and provide a reference page as
needed.
https://www.boundless.com/finance/textbooks/boundless-finance-textbook/analyzing-financialstatements-3/the-dupont-equation-roe-roa-and-growth-44/the-dupont-equation-220-3900/ What are the key components of the Strategic Profit Model? How can it be
used to examine the effect of logistics decisions?
Use the 2012 income statement and balance sheet below to complete a
Strategic Profit Model for Jones Company.
Income Statement 2012
Sales
Cost of Goods Sold
Gross Margin Jones Company
$200,000
$130,000
$ 70,000 Transportation Cost
Warehousing Cost
Inventory Carrying Cost
Other Operating Costs
Total Operating Costs
Earnings before interest and taxes
Interest
Taxes
Net Income
Balance Sheet 2012
Assets
Cash
Accounts Receivable
Inventory
Total Current Assets
Net Fixed Assets
Total Assets
Liabilities
Current Liabilities
Long-Term Debt
Total Liabilities
Shareholder’s Equity
Total Liabilities and Equity $6,000
$3,000
$1,000
$30,000
$40,000
$30,000
$11,000
$6,000
$13,000 $20,000
$35,000
$15,000
$70,000
$80,000
$150,000
$60,000
$30,000
$90,000
$60,000
$150,000
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