Summarize managerial accounting and recent business trends (Learning Objectives 1, 2, 3, 5)

One of your friends has taken a great interest in Australia and wants to import home decor items from Australia after college. He has not taken any business classes but has begun to read business newspapers and magazines to develop some business knowl¬ edge. He has several issues on which he would like your input. Discuss with him what you know about the following:

1. Your friend feels confident about his abilities to select marketable Australian home decor, but questions whether he should manage the company himself or hire someone to manage the company while he takes on the role of the chief buyer. He wonders what his role would be if he were the company manager as well.

2. He’s heard of financial and managerial accounting and wonders if they are the same thing.

3. Because you are taking an accounting class, he asks you to explain how to structure the financial arm of a large organization.

4. Your friend has high hopes for his company. He foresees his business growing into a chain of home decor stores, similar to Pier 1 Imports or Cost Plus World Market. To grow the business to this level, he will have to take the company public. He wants to know how SOX will affect a publicly traded company.
5. The business magazines often mention TQM and the ISO. He wants to know if TQM and the ISO 9001:2000 certification apply only to manufacturers.
6. Your friend also sees frequent references to JIT production. First, he would like to know what JIT is. Second, he wonders if it would apply to his business.
7. Your friend wonders if he should invest in e-commerce or depend solely on sales generated by foot traffic into his “brick-and-mortar” retail stores.