Sea Soft Water Company

In: Business and Management

Submitted By lucywhite
Words 417
Pages 2
Case 1: Sea-Soft Water Company

The Sea-Soft Water Company distributes its water softeners to dealers upon their request. The contract agreement states that dealers may have 90 days to sell and pay for the softeners. Until the 90-day period is over, any softeners may be returned at the dealer's expense and with no further obligations on the dealer's part. If the water softeners are damaged while in the hands of a dealer, Sea-Soft agrees to accept the return of the damaged softeners with no obligation to the dealer. Past experience indicates that 75% of all softeners distributed on this basis are sold by the dealer. In June, 100 units are delivered to dealers at an average billed price of $800 each. The average cost of the softeners to sea-Soft is $600. Based on the expected sales, Sea-Soft reports profit of $15,000. Evaluate Sea-Soft's revenue recognition policy for its compliance with GAAP. What recommendations would you make?

Sea-Soft’s revenue recognition policy is not in compliance with GAAP. Based on the facts described above, Sea-Soft grants its dealers rights of return if they are unable to sell the water softeners within 90 days or the products are damaged. Because the return of merchandise can negate benefits of having made a sale, the seller must be able to make reliable estimate of future returns, and the right of return should be specified contractually as expiring on some future date.

According to SAB No. 101, revenue is recognized when “persuasive evidence of a sales arrangement exists; delivery of goods occurs through transfer of title and risk and rewards of ownership, the selling price is fixed or determinable and collectability is reasonably assured…” In this case, even thought a 25% of return within 90-day period can be estimated by Sea-Soft, there is still a high degree of uncertainty that the water softeners might be returned at a…...

Similar Documents

Chickens of the Sea

...CHICKENS OF THE SEA Not long ago, a friend once told me that he heard Jessica Simpson say on television, that a brand of canned tuna called “Chicken of the Sea” literally means, chickens that live in the sea. As we all know chickens cannot naturally live in the sea due to their physical deficiencies in water. In other words, the only way chickens could live under the sea is if the company invested billions into undersea chicken farms. For example, They could build giant undersea domes just like Sandy Peaches, in the hit kids television show “Spongebob Squarepants”. Furthermore the labeling itself states quite clearly that the food product contained in the tin is in fact tuna. Now, if the label didn’t say anything about tuna on the front It would be very easy to confuse the product with chicken, but that is not the case for this specific brand. In addition, tuna in general is very different from chicken in so many aspects, that it is really hard to confuse tuna with chicken. The textures, colors, and taste are so different that anyone who has ever eaten both tuna and chicken, could easily differentiate between the two products. Jessica Simpson’s statement is a falsehood that can be proven wrong with simple observation. First, chickens cannot live in the sea due to the fact that they have evolved on land for millions of years. Everything about their bodies have been finely tuned for living life on the surface of the world. Resulting in different organs compared to marine...

Words: 975 - Pages: 4

Healthy Spring Water Company

...HEALTHY SPRING WATER COMPANY Summary: The Healthy Spring Water Company sells bottled water, priced at $20 per 10 gallon bottles, to homes and offices. On average, the company sells about 2000 units per day. With its current pricing, the demand for the water is stable, but management is always looking for new ways to shake things up and increase profits. The company has thought about repositioning their water as a premium product, which would increase the unit price; and in return increase profit. If this idea goes the way the company predicts, they could charge 20% more for its water. Questions: 1. What is the maximum sales loss (in % and units) that Healthy Spring could tolerate before a 20% price increase would fail to make a positive contribution to its profitability? (That is, what is the basic break-even sales change?) Answer: 25% sales loss (1500 break-even sales change) -.20 divided .8 = .25 (12/20+.20=.8) __________________________________________________________________________________________________________________ 2. By how much would Healthy Spring's contribution increase if its sales declined by 15% following the price increase? Answer: -1.54 __________________________________________________________________________________________________________________ 3. In order for Healthy Spring to reposition itself as premium water, management believes that it will have to upgrade the packaging of its product. The company will deliver the water in......

Words: 575 - Pages: 3

Sea Venture

...“Sea Venture” In 1609 the Virginia Company had a decision to make. Continue business as usual and allow the settlers in Jamestown to slowly perish, and not recoup any money for its investors, or drum up more investors and send the single largest group of settlers the New World had seen. The decision that Thomas Smythe and the Virginia Company made would lead to the settlement of a new land, and save Jamestown. In February 1609, the Virginia Company acquired a new charter for Jamestown, the Second Charter of Virginia, from King James. The new charter not only restructured the Colony in the new world, but completely restructured the Virginia Company and gave them “full and absolute power and authority, to correct, punish, pardon, govern, and rule.” The new charter granted them this power in all of Virginia, as well as the on the seas to and from the new world. The charter prohibited breaking any English law in the colony, but otherwise “they, in their good discretion, shall think to be fittest for the good of the adventurers and inhabitants there” The restructuring of Virginia was also in the new charter, it expanded the colony from 10,000 square miles to over one million square miles. The first decision made by the Virginia Company was to send Sir Thomas Gates to Virginia as Governor. Admiral George Sommers was chosen to command the fleet, and England’s most renowned Captain, Christopher Newport, would sail the lead vessel. The Virginia Company rounded up investors......

Words: 2020 - Pages: 9

Factors That Influence the Reproduction of Sea Cucumbers

...echinoderm class Holothuroidea consists of sea cucumbers, which can be described as worm-like organisms with elongated, soft bodies. Like most echinoderms, holothuroids have 5 rows of tube feet along their bodies. These tube feet aid the animal in attachment, locomotion and respiration (Pearse et al. 1987). Within the class Holothuroidea, there are about 1250 species, and these are distributed among 200 genera (Smiley et al. 1991). There is much variety among the habitats in which sea cucumbers reside. Some species, like Cucumaria fallax, inhabit quiet, still waters, while others, such as C. miniata, are found in areas that are constantly swept by tidal currents (McEuen 1988). Some holothuroids are tropical reef dwellers (Uthicke 1997); others live in temperate or polar waters (Hamel and Mercier 1995). Even the depth at which these animals can be found varies greatly. Many species live within the intertidal zone, but a few sea cucumbers live deep in the ocean, some among hydrothermal vents (Smirnov et al. 2000). Regardless of the environment in which they are found, sea cucumbers have become highly adapted to life in that environment, especially in their reproductive cycles. Sea cucumbers can reproduce through sexual reproduction as well as asexual reproduction. Each mode of reproduction has several environmental factors that have been proposed to control its timing. This paper will first introduce the two types of reproduction found in sea cucumbers. I will then discuss some......

Words: 3737 - Pages: 15


...demand at the water refilling stations – water stores that sell purified water – is now increasing. The quality of purified water conforms with the national standards for drinking water and is even better than the quality of water produced by traditional water supply systems in terms of removed impurities. Over the years, as the demand for cleaner water becomes higher, the price of household water purifiers and bottled water has become prohibitive. Water refilling stations managed by private entrepreneurs offer a cheaper and more convenient solution to the public’s drinking water needs than bottled water or the use of household filters. At present, about 3,000 water refilling stations have proliferated nationwide. They sell purified water of comparable quality with bottled water at a lower price. For example, the current price per gallon of refilled purified water in Metro Manila ranges from P 50 to P 120 per 5-gallon container or about P 2.50 to P 6.00 per liter while the bottled water is sold at P 12.00 to P 25.00 per liter. Household filters, on the other hand, cost P 5,000 to P 25,000 per unit ( 1 US $ = P 56 in 2004). In Metro Manila, most of the water refilling stations are connected to the pipes of two concessionaires: Maynilad Water Company or Manila Water Company for their source of raw water while in other areas they opt to use private deep wells. The “potable water” supplied by the providers is then further purified by utilizing a combination of water......

Words: 1155 - Pages: 5

Soft Industry

...Historically, the soft drink industry has been profitable for a variety of reasons. The traditionally large share of market for Coca-Cola and Pepsi establishes a large barrier of entry for others to enter the market. This results in an ability to charge higher retails, and thus preserve margin. In addition, both the Coca-Cola Company and Pepsi have franchisee agreements or own their bottlers. This controls access of the distribution network to other beverage companies. Due to the size of these two market leaders in the soda pop business, their established source and distribution channels are extremely fine-tuned. Historically, the companies were able to dictate prices to their bottlers based upon bottling agreements. They were also able to prevent their bottlers from carrying competing brands, which could have possibly driven down the profitability of the major brand. In addition, the two main entrants benefit from economies of scale in negotiating best rates for the majority of their needs. Most of the raw materials needed to produce soda pop are basic commodities like color, flavor, caffeine, additives, sugar and packaging. This allows the companies more power to produce cheaply. From here, both companies control the concentrate, and "regularly raised concentrate prices, often by more than the increase in inflation" (Yoffie, Kim, 2011), further adding profitability to the category. Soda pop companies have maximized profits in another manner: through the manipulation of......

Words: 957 - Pages: 4


...StrategicmanagementBottled water industry in 2006 Case 2. Summary• 1) Dominant Economic Features• 2) Drivers of change• 3) 5 porters analysis• 4) Key success factors• 5) Strategic group map• 6) Recommendations 3. 1)Dominant economic features1) Market Size and 2) Scope of compétitive Growth Rate: rivalry : 4. 3) Number of rivals : 5) Distribution channels :• Nestlè • wholesale clubs• Coca-Cola • supermarkets• Pepsi • discount stores• Groupe Danone • food store• Suntory Water Groups • supercenters 6) Pace of technological4) Number of buyers change. No one buyer accounts for a significant fraction of 7) Degree of product overall market demand. différentiation 8) Vertical integration 5. 2) Drivers of change:• Increase in environmental concerns• Convenience and portability• The profit margins in the industry are very lucrative• To facilitate entry into carious parts of the globe many companies enter into strategic alliances 6. 3) 5 porters analysis 7. The threat of substitute product• Other type of drinks : Soft drink, milk, Tea, Soda• Innovative products like vitamin water and flavored water.Those products are more and more popular andthat’s why they can be considerate as a real threat. HARD! 8. The threat of the new entrant• Biggest competitors have the majority of the global market.• Only competitors that are able to provide important quantities of bottles water with a cheap price will be able to enter this market. DIFFICULT! 9. The bargaining power of suppliers• Due to...

Words: 447 - Pages: 2

Soft Drinks

...Soft drinks are enormously popular beverages consisting primarily of carbonated water, sugar, and flavorings. Nearly 200 nations enjoy the sweet, sparkling soda with an annual consumption of more than 34 billion gallons. Soft drinks rank as America's favorite beverage segment, representing 25% of the total beverage market. In the early 1990s per capita consumption of soft drinks in the U.S. was 49 gallons, 15 gallons more than the next most popular beverage, water. The roots of soft drinks extend to ancient times. Two thousand years ago Greeks and Romans recognized the medicinal value of mineral water and bathed in it for relaxation, a practice that continues to the present. In the late 1700s Europeans and Americans began drinking the sparkling mineral water for its reputed therapeutic benefits. The first imitation mineral water in the U.S. was patented in 1809. It was called "soda water" and consisted of water and sodium bicarbonate mixed with acid to add effervescence. Pharmacists in America and Europe experimented with myriad ingredients in the hope of finding new remedies for various ailments. Already the flavored soda waters were hailed as brain tonics for curing headaches, hangovers, and nervous afflictions. Pharmacies equipped with "soda fountains" featuring the medicinal soda water soon developed into regular meeting places for local populations. Flavored soda water gained popularity not only for medicinal benefits but for the refreshing taste as well. The market......

Words: 5213 - Pages: 21

There Will Come Soft Rain

..."August 2026: There Will Come Soft Rains" By Lasse Lundqvist What would the world look like in the future, if nuclear bombs were dropped in the United States of America? One option for that answer is to find I the short story “There will come soft rains - August 2026” by Ray Bradbury. This essay will deal with the human technology development, which is a threat for the. Nevertheless, the nature will always recover from the destruction of technology. Through the narrative we get to know the routine of the everyday life in an empty house, with the only purpose of serving the gods; the humans. The story takes place in the year 2026, and mankind has invented a house that is capable of working on its own. In the town of Allendale, a house stands alone in a city of rubble an ash. The city is the outcome of an exploded nuclear bomb and lies in ruins. The atmosphere is very cold due to the lack of humanity, but the narrator manages to make the reading experience energetic by giving the robots human characteristics. “An aluminium wedge scraped them into the sink, where hot water whirled them down a metal throat which digested and flushed them away to the distant sea.”(Bradbury l.20 p.1). By using the word “digested” the story becomes more alive. With its humanlike features, the house has become controlling and demanding. Everything has to be done in an exact point of time. All the tasks the house has, must be carried out to the fullest. “In the kitchen the breakfast stove…......

Words: 975 - Pages: 4

Disasters at Sea

...out oil into the water. Oil spills can have other motives behind them as well such as terrorists may create an oil spill to send a message. There are also illegal oil dumpers, who will deposit their crude oil (waste) into the ocean instead of decomposing it and spending the required money to do so. Below is a picture of an oil tanker leaking out oil. [pic] Exxon Valdez was the “largest oil spill to occur in the world,”* and the crisis began on March 23, 1989. The location was in Prince William Sound in Alaskan shore. Then of course there is the question of how it happened, the people on the Exxon Valdez ship had identified icebergs and decided to take a different route to get around them. Unfortunately the oil tanker crashed into shallow water, this area is actually called the Bligh Reef, but because of the hit the tanker had about 10 million gallons of crude oil into the reef. To help you really picture how much exactly that is, visualize about “125 Olympic sized swimming pools.”* Comparing this to other American oil spills this leak was enormous. The table below shows worldwide major oil calamities (not including Exxon Valdez), and none of them are in the US. [pic] The ways an oil spill can be dealt with are numerous. You can set up a boom around the tanker which is leaking the oil-this collects oil off the water and will absorb any oil that flows around it. On the other hand there are skimmers, which are used for removing oil off the water also, and have......

Words: 1561 - Pages: 7


...Analysis: Bottled Water Causal Analysis: Bottled Water Ashlie Delaney Galen College of Nursing Bottled water has been around for centuries. While the aqueous solution in the bottle is imperative to your health, there are drawbacks to that liquid gold. And the package it rests in. Let us start of with a little history. One of the oldest discoveries of bottled water dates back to 1450 BC. There were murals painted the walls of ancient pharaohs tombs depicted canteens filled of the liquid. The Roman’s built one of the very first water transporting system. In 1767 water was first bottled in America under curative properties. Mineral water from New York was bottled commercially somewhere in the early 1800’s. In 1820, the popular Sarasota Springs sold their first bottled water. In the early times of commercially bottled water, it was marketed as a luxury drink to the wealthy and famous. It takes around 17 million barrels of oil to produce the plastic water bottles in The United States of America. Like bottled water, fossil fuels are harvested from locations around the world, processed, shipped and the consumed. Bottled water wastes a lot of fossil fuels. The burning of oil and other fossil fuels emits global warming pollution into the atmosphere. The price of bottled water is higher than the price of tap water, but in many instances, the water quality is the same. There is even a chance that an expensive bottle of water is just purified municipal tap water. The theory......

Words: 1101 - Pages: 5


...Water is a molecule comprised of two hydrogen atoms (positively charged), and an oxygen atom (negatively charged)- bonded together by shared electrons. It is a V-shaped polar molecule, which gives water a high degree of polarity. In addition, water molecules are naturally strong, due to the interactions occurring between the hydrogen atoms, known as hydrogen bonding. Specifically, hydrogen bonding in water, accounts for some of its unique properties; such that it is denser in its liquid state than in its solid state (ice floats on water). Water is also the only substance that occurs naturally as a solid, liquid, or gas, and covers about 70% of the Earth’s surface (U.S. Geological Survey, 2000). Water is a very broad topic, and highly crucial to life on Earth. It is important to mention the movement of water throughout the planet, the usages of water, and the underlying scarcity of water. The Hydrologic cycle, more commonly known as the water cycle, is the movement of water between the Earth’s oceans, atmosphere, and land. There is continuous evaporation of water; uptake of water vapor into the atmosphere; precipitation onto the ocean and land surfaces; and the net atmospheric transport of water from land areas to the ocean. Essentially, the water cycle is the means of how the Earth’s constant supply of water is being recycled. It is imperative that this cycle exists, so that water is able to reach plants and animals; provide nutrients and sedimentary movements......

Words: 1471 - Pages: 6

Sea Otters

...Sea Otters Article #1 This aquatic member of the weasel family is found along the coasts of the Pacific Ocean in North America and Asia. The sea otter spends most of its time in the water but, in some locations, comes ashore to sleep or rest. Sea otters have webbed feet, water-repellent fur to keep them dry and warm, and nostrils and ears that close in the water. Sea otters often float at the water's surface, lying on their backs in a posture of serene repose. They sleep this way, often gathered in groups. Otters sometimes float in forests of kelp, or giant seaweed, in which they entangle themselves to provide anchorage in the swirling sea. These aquatic otters do more than sleep while floating on their backs. They are often seen with a clam or mussel and a rock that has been deftly snared from the ocean floor. Otters will place the rock on their chests, and repeatedly smash the shellfish against it until it breaks open to reveal the tasty meal inside. They also dine on such aquatic creatures as sea urchins, crabs, squid, octopuses, and fish. Sea otters are the only otters to give birth in the water. Mothers nurture their young while floating on their backs. They hold infants on their chests to nurse them, and quickly teach them to swim and hunt. Sea otters are meticulously clean. After eating, they wash themselves in the ocean, cleaning their coat with their teeth and paws. They have good reason to take care of their coats—it helps them to remain waterproof...

Words: 1578 - Pages: 7

Water Bottling Company

...Nurrific Water Bottling Company Tamikia Washington Argosy University Table of Contents Introduction to Marketing 6 MARKETING 6  The Marketing Mix 6  PRICE 6  PRODUCT 7  PLACE 7  PROMOTION 7  The Marketing Environment 7 Marketing and its relationship with other functional areas of business 8 RESEARCH AND DEVELOPMENT 8  Human Resource 8  Customer service 9  Planning 9 Goals and Objectives 9  Planning Gap 9 Ethics in Marketing 10 Market Research 10 Research methods & Data Mining 10 Market Research Process 11 Consumer Behavior 11 B2C vs. B2B 11 Marketing to B2B 11 Marketing to B2C 11 Consumer Decision Making Process 12 Factors Affecting B2C and B2B consumer behavior 12 Market Segmentation 12 Market Segmentation Concepts 12  Behavioral 12  Demographic 12  Geographic 12 PRODUCT 13 o Core product 13 o Actual product 13 o Augmented product 13 Product life cycle 13 o Introduction Stage 13 o Growth Stage 13 o Maturity Stage 13 o Decline Stage 14 BSC model 14 Services Marketing 14  Price determination and Pricing Strategies 14  Supply 14  Demand 15 Competition 15  Objectives and Strategies 15 o Price skimming 15 o Price penetration 15 Distribution channel 16  Logistical arm 16  Marketing arm 17 Length and width 17 Direct and indirect 17 o Direct channels 17 o Indirect channel 17 Verbal & Horizontal channel conflict 17  Verbal......

Words: 4227 - Pages: 17

South China Sea

...Indonesian Strategy on the South China Sea By Ferry Akbar PASARIBU/SESPARLU Batch 54 Indonesia never had any overlapping claim on the South China Sea, even though one of its chains of Islands, namely Natuna Island, is located at its southern end. The 1957 Juanda Declaration stipulated that Indonesia as an archipelagic country, and accordingly Natuna Island had been declared as its baseline. The last administration had even registered it at the United Nations in 2009 without receiving any dissenting opinions by any countries. During the Soeharto administration, Indonesia had made it clear on its official map that it had 200 nautical mile Exclusive Economic Zone (EEZ) drawn from its outmost chains of Islands, including Natuna Island. Therefore, the Minister of Foreign Affairs of the time, especially during the period of Professor Mochtar Kusumaatmadja in the office in the 1980s, had been working around the clock to ensure that Indonesian position was accepted by the region and beyond. Even China’s Minister of Foreign Affairs, Mr Qian Qichen later in 1995 had agreed with his counterpart the Minister of Foreign Affairs of Indonesia at the time, Mr Ali Alatas that both countries did not have any overlapping claim over Natuna Island and its surrounding areas. In the period of 1990 – 2000, China conducted the so-called soft diplomacy with regard to the issue of South China Sea. It apparently worked hard to win the confidence of ASEAN, especially of some of its members......

Words: 1965 - Pages: 8

Serviettes | Web Apps | The Walking Dead No Man's Land premium