Question 1 Consider that ABC Company has two options: Option A: Sell the old equipment for $400,000 and purchase new equipment for $700,000. Operating costs are unchanged. Option B: Refurbish the old equipment for $200,000 and incur an additional $10,000 per year operating expense for ten years. Which option should ABC Company proceed?| Answer: Question 2 The case for Question 2 in the project (you should have read and understand about this case when you complete your project): Employee bonuses at American Interconnect (AI), a large communications firm, depend on meeting a number of targets, one of which is a revenue target. Some bonus is awarded to the group if it meets or exceeds its target revenue for the year. The bonus is also tied to meeting targets for earnings, employee satisfaction, hiring goals, and other specific objectives tailored to the group or manager. Al has several product development groups within the firm. Each is assigned the task of developing new products for specific divisions within the firm. Product developers, primarily engineers and marketing people, are assigned to a new product development team to develop a specific new product. Afterward, they are assigned to new development teams for a different division or are reassigned back to their former departments. Sometimes they become product managers for the new product. Product development teams take roughly 18 months to develop and design the product. For example, Network Solutions is one group of products Al sells. The employees in the product development group for Network Solutions receive part of their bonus based on whether Network Solutions achieves its revenue target for that year. It typically takes Al three years from the time a product development team is formed until the product reaches the market. Once a new product idea is identified and researched, a prototype must be built and tested. Finally, it is introduced. Another 18 months is required for approval, manufacturing design, further testing, and marketing. These functions are performed after the product development team has been reassigned Required: (a) From the case, Al is trying to provide incentives for product developers to increase firm revenues by developing new products the market wants. Is the incentive system working? (b) Explain your answer in (a). Question 4 (10 marks) In the project, the subject of balanced Scorecard is Pottery Store, a chain of retail stores that sells pottery, woodcarvings, and other craft items. In this question, think of Lulu Hypermarket, also retail stores but serving consumers goods. Required: With reference to Lulu Hypermarket, Name each quadrant of the balanced Scorecard below based on the 4 perspectives and give at least 2 examples for each quadrant: What is this quadrant known? What is this quadrant known? Examples: Examples: What is this quadrant known? What is this quadrant known? Examples: Examples
