This assignment we will explore the issue of trade-offs with mode of transport, transportation costs andshipment availability. We are working for the supply chain for wheat flour producing company. Happy Wheat Cereal is currently operating two packaging plants, located on in Calgary and second in Toronto. Students will only need to look at one movement, and only one segment of the supply chain: between the mill and the two packaging plants.The flourmill produces 500,000 metric tons offlour per year and produces flour at a steady pace.70% of the flour is shipped to commercial bakeries and food processors. This part of the supply chain is not examined in this exercise.The remaining 30% of the flour is destined for the retail market, and is shipped by the mill to the Happy Wheat Cereal packaging plants. Two-thirds of the shipments go to the Calgary plant, and one-third goes to Toronto.The shipment from the mill to the packaging centres is done in bulk, by rail. Each rail car holds 80 tonnes of flour.With the current ordering process ordering single car loads and the possible cost savings, Happy Wheat Cereal’s supply and purchasing manager are interested in understanding the total cost transportation if they decided to order in lot sizes of:a) once a year b) twice a year or c) three times a year.If the mill decides to ship flour in multiple car shipments, and if the shipments have to be unloaded within 12 hours after arrival, it will have to build bulk storage facilities, and will have to absorb the carrying costs of that inventory. With these costs factored in, the annual carrying cost of the flour will be 25% of the value of product. •The wholesale value of the flour is $350 per tonne•Lead time is 20 daysbetween orders and delivery•Happy Wheat Cereal is forecasting the demand 200,000 (Note: you need to figure out the distribution for Toronto and Calgary Plants) •Happy Wheat Cereal’s annual carrying costs is at 25%the value of the product•Happy Wheat Cereal has also calculated there variable order cost to be $500per orderGeneral RefUnitKilogramsPick up NotificationShip TimeLTL1 Case802hrs5 daysLTL2Pallets2,0001 day10 daysLTL4 Pallets4,0001 day10 daysTL10 Pallets10,0001 day10 daysRailSingle Car80 5 day5 daysRail25 Cars2,00010 day10 daysRail50 Cars4,00017 days10 daysRail100 Cars8,0003 weeks10 daysInstructions:1.Calculate the dimensional weight of the items below.(2 marks)2.Calculate the chargeable weight of the items below and apply the appropriate rate.(2 marks)3.List the total charge for each method of shipment.(2 marks)4.Calculate the savings per metric tonne with multi-car shipments(4 marks)5.How many times per year will Happy Wheat Cereal place an order of size Q”? Calgary? Toronto?(4)6.Using the data from the EOQ formula, what quantity provides the most efficient delivery? Calgary? Toronto?(4)7.Taking a look at Holding vs Ordering inventory, what are a few learning points from this activity? (2)

Black swan event has markets in flap

The Australian share market has suffered its worst week since the global financial crisis as fear over the rapid spread of coronavirus wiped more than $200 billion from company values.

A week-long selling spree intensified yesterday as the nation’s key stock market benchmark, the ASX 200, plunged 3.3 per cent to 6441.2 points. The rout — the biggest one-day drop in 4½ years — wiped $65.1 billion from the value of the nation’s 200 biggest listed companies.

It took the week’s losses to $210.1 billion and plunged the market into an official correction. The market touched a record high of 7162.4 points late last week but has been sold off every day since, shedding 10.1 per cent in total.

This week’s fall is the biggest since October 2008, when the local bourse plunged by more than 15 per cent after the collapse of US investment bank Lehman Brothers sent a shockwave through the global financial system. Investors across the globe have hit the sell button this week as COVID-19 has flared in Asia, Europe and the Middle East.

“It’s been unbelievable,” Wilson Asset Management chair Geoff Wilson said. “The major question now is, are we heading into a bear market?” Mr Wilson, who manages $3 billion in funds, has increased his cash holdings from 12 per cent to 20 per cent this week by selling shares as a defensive measure.

Montgomery Investment Management chief investment officer Roger Montgomery said COVID-19 was a “black swan” event — a major global disruption that had blindsided investors at a time stock prices were at record highs.

The ASX 200 surged 18.4 per cent in 2019 — its best year in a decade — and jumped another 7.2 per cent this year before the virus sparked panic on markets.

Required

I. Montgomery Investment Management chief investment officer Roger Montgomery said COVID-19 was a “black swan” event’. Why do you think Covid-19 was labelled as a black swan event?

II. What accounting theories can be applied to the discussion reported in the article?

Part B

Ethical question Assume you are the manager of the accounts division and you are aware that all staff members of the division are working under workload pressure. Staff members are currently working from home due to the Covid Pandemic. Most of the staff members are single or married with no children. However, one junior staff member, Kathy, who is a single mum has two children of primary school age. Due to the recent lock down, the children are being home schooled. As a result, Kathy is missing some important meetings and cannot attend to her full workload. This has put additional pressure on other staff members’ workloads. This issue has been raised in a staff meeting by her colleagues, bringing more stress to Kathy. You understand that due to financial hardships Kathy has to work fulltime. What you should do?

Required

How do you think this situation should have been handled? Discuss the ethical dilemma presented by this case using the ethical decision-making framework (model) given below or another model that you know.

An ethical decision making framework using Utilitarian and Rights Theories

• Identify the ethical issue(s).

• Determine the affected parties and identify their rights.

• Determine the most important rights.

• Develop alternative courses of action.

• Determine the likely consequences of each proposed course of action.

• Assess possible consequences including an estimation of the greatest good for the greatest number.

• Determine whether the rights framework would cause any action to be eliminated.

• Decide on an appropriate course of action.