TABLE C2.1 Market Data Case 2 The Allen and Gary Show Allen Construction and Gary and Sons Construction are fierce competitors. The pres ident of Allen is so excited about the growth that he is considering adding two new crews for the 2012 construction season. In 2011, Allen successfully won four out five jobs for which they have competed. Mr. Allen stated that he has revised the financial targets to account for the unexpected growth that they experienced in 2011. During the same period, Gary Construction won only one out of seven jobs. In 2010, Allen Construction and Gary and Sons Construction were successful bidders on the projects given in Table C2.1. The overhead for each firm is also given in Tables C2.2 and 23 Copyright 2012 WC en Anghts reserved Customer Number 101 101 101 101 101 101 101 101 101 101 102 102 102 102 103 103 103 105 105 107 107 109 109 109 109 109 110 110 110 110 112 112 112 118 Winning Bid (5) 109,000 167,200 72,600 134,700 108,600 141,700 77,000 193,458 119,900 63,700 91,700 122,000 99,100 88,700 147,100 78.000 97,100 118.900 132,800 87,600 123,700 111,200 76.300 104.700 112,346 137,600 141,000 92,600 108.200 111,700 178,800 133,400 117,100 80,800 Successful Bidder Gary Gary Allen Allen Allen Allen Allen Allen Allen Allen Allen Allen Allen Allen Gary Allen Allen Allen Alien Allen Allen Gary Gary Gary Gary Allen Allen Allen Allen Allen Allen Allen Gary Allen Total Direct Cost (5) 83,450 138,023 69,567 130,567 106.356 138,945 75,782 192,890 120,875 75,673 87,456 117,234 95,783 85,982 118,934 74,673 92.783 113,892 128,903 84,675 120,987 93.200 65,090 91,400 99,200 136,784 138,934 91,653 107,634 113.456 170,987 128,764 96,234 82,894 TABLE C2.2 Allen Construction Company Home Office Overhead Expenses TABLE C2.3 Gary and Sons Construction Company Home Office Overhead Expenses Overhead Management wages Estimating (part-time) Office Mgr./Sec/Acct. Payroll taxes (Mgt), 25% Hospitalization (5 families @ $500 per month) Office rent Telephone Postage Office supplies Legal Accounting Interest Travel (mileage) Mobile phone Pager-rental Association dues Marketing Estimating Cost of plans Overhead Management wages Estimating (Part-time) Office Mgr./Sec /Acct Payroll taxes (Mgr.), 25% Hospitalization (4 familles @ $500 per month) Office rent Telephone Postage Office supplies Legal Accounting Interest Travel (mileage) Mobile phone Pager-rental Association dues Marketing Estimating Cost of plans Case 2 The Alls and Car Show 447 Expense ($) 140,000 20,000 28,000 47,000 30,000 2,400 2,400 1,200 1,800 1,000 7,000 16,000 6,000 2.400 600 500 2,000 2.400 Expense (5) 140,000 20,000 18,000 44,500 24,000 2,400 1,200 350 450 750 4,000 3,890 2,430 650 600 500 3.500 1,800 Assignment Questions 1. Analyze the performance for each firm. Your analysis should be as thorough as possible given the data and your assumptions. 2. What are the strengths and weaknesses of each company? 3. Write a memo outlining your recommendations for each of the businesses. TABLE C2.1 Market Data Case 2 The Allen and Gary Show Allen Construction and Gary and Sons Construction are fierce competitors. The pres ident of Allen is so excited about the growth that he is considering adding two new crews for the 2012 construction season. In 2011, Allen successfully won four out five jobs for which they have competed. Mr. Allen stated that he has revised the financial targets to account for the unexpected growth that they experienced in 2011. During the same period, Gary Construction won only one out of seven jobs. In 2010, Allen Construction and Gary and Sons Construction were successful bidders on the projects given in Table C2.1. The overhead for each firm is also given in Tables C2.2 and 23 Copyright 2012 WC en Anghts reserved Customer Number 101 101 101 101 101 101 101 101 101 101 102 102 102 102 103 103 103 105 105 107 107 109 109 109 109 109 110 110 110 110 112 112 112 118 Winning Bid (5) 109,000 167,200 72,600 134,700 108,600 141,700 77,000 193,458 119,900 63,700 91,700 122,000 99,100 88,700 147,100 78.000 97,100 118.900 132,800 87,600 123,700 111,200 76.300 104.700 112,346 137,600 141,000 92,600 108.200 111,700 178,800 133,400 117,100 80,800 Successful Bidder Gary Gary Allen Allen Allen Allen Allen Allen Allen Allen Allen Allen Allen Allen Gary Allen Allen Allen Alien Allen Allen Gary Gary Gary Gary Allen Allen Allen Allen Allen Allen Allen Gary Allen Total Direct Cost (5) 83,450 138,023 69,567 130,567 106.356 138,945 75,782 192,890 120,875 75,673 87,456 117,234 95,783 85,982 118,934 74,673 92.783 113,892 128,903 84,675 120,987 93.200 65,090 91,400 99,200 136,784 138,934 91,653 107,634 113.456 170,987 128,764 96,234 82,894 TABLE C2.2 Allen Construction Company Home Office Overhead Expenses TABLE C2.3 Gary and Sons Construction Company Home Office Overhead Expenses Overhead Management wages Estimating (part-time) Office Mgr./Sec/Acct. Payroll taxes (Mgt), 25% Hospitalization (5 families @ $500 per month) Office rent Telephone Postage Office supplies Legal Accounting Interest Travel (mileage) Mobile phone Pager-rental Association dues Marketing Estimating Cost of plans Overhead Management wages Estimating (Part-time) Office Mgr./Sec /Acct Payroll taxes (Mgr.), 25% Hospitalization (4 familles @ $500 per month) Office rent Telephone Postage Office supplies Legal Accounting Interest Travel (mileage) Mobile phone Pager-rental Association dues Marketing Estimating Cost of plans Case 2 The Alls and Car Show 447 Expense ($) 140,000 20,000 28,000 47,000 30,000 2,400 2,400 1,200 1,800 1,000 7,000 16,000 6,000 2.400 600 500 2,000 2.400 Expense (5) 140,000 20,000 18,000 44,500 24,000 2,400 1,200 350 450 750 4,000 3,890 2,430 650 600 500 3.500 1,800 Assignment Questions 1. Analyze the performance for each firm. Your analysis should be as thorough as possible given the data and your assumptions. 2. What are the strengths and weaknesses of each company? 3. Write a memo outlining your recommendations for each of the businesses.