Delta’s New Song: A Case on Cost Estimation In the Airline Industry Contents Question 1 2 Question 2 3 Question 3 4 Question 4 7 Question 5 8 Question 1 8 Question 2 9 Question 3 11 Question 4 13 Appendix 1 13 Appendix 2 19 Question 1 There are several possible factors that seem more relevant to be as a cost diver to estimate Delta’s salaries: * Available Ton Miles * Number of Departures(thousand) * Revenue Passenger Miles * Revenue Ton Miles *
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The Airline is one of the major industries in the world today and is majorly affected by Michael Porter’s Five Forces model. In case of the Airline industry‚ this is the most important force today‚ especially since the market is completely saturated. There are more service providers than needed in both local as well as international markets. The airlines are continually competing against each other in terms of prices‚ technology‚ in-flight entertainment‚ customer services and many more areas. One
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Prime cost. | B | Conversion cost. | C | Period cost. | D | Nonmanufacturing cost. | 2. | Prime cost and conversion cost share what common element of total cost? | A | Direct materials. | B | Direct labor. | C | Variable overhead. | D | Variable overhead. | 3. | On the Schedule of Cost of Goods Manufactured‚ the final Cost of Goods Manufactured figure represents: | A | the amount of cost charged to Work in Process during the period. | B | the amount of cost transferred
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1978‚ President Carter signed into law the Airline Deregulation Act. The purpose of the law was to effectively get the federal government out of the airline business. By allowing the airlines to compete for their customers’ travel dollars‚ was the thinking‚ that fares would drop and an increased number of routes would spring up. Expected Results The results of airline deregulation speak for themselves. Since the government got out of the airline business‚ not only has there been a drop in
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Chaos in the skies - the airline industry pre and post 9/11 Case Study Chaos in the skies- the airline industry pre and post 9/11 1. Introduction The terrorist attack on the New York World Trade Center and the Pentagon on September 11‚ 2001‚ when civilian planes were turned into guided missiles flown by suicide bombers driven by religious fundamentalism and hatred for the United States not only seared themselves into the consciousness of the American people‚ but into the economic and business
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US Airline Industry – Porter’s Five Forces The year 2011 was another dismal one for US airlines in terms of financial performance. Despite an increase in both passenger numbers and revenues for the year‚ profits were down on 2010. In total‚ US airlines earned net profits of about $0.4 billion‚ representing a net margin of less than 1%. The dire financial state of the industry was underlined by AMR (the parent of American Airlines) entering Chapter 11 bankruptcy in November 2011. This ended AMR’s
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American Airlines Marketing cases AMERICAN AIRLINES 1. Issues 2. American Airlines’ objectives 3. The airline industry 4. Market 5. Consumer needs 6. Brand image 7. Distribution system 8. Pricing 9. Marketing related strategies 10. Assumptions and risks 1- Issues The main issue of this case is the lack of profits of the airline industry‚ an industry that should be more than profitable due to the large amount of customers‚ the necessity of using airlines’ services and the high prices charged by most
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Strategy in the Market Place: Malaysia Airlines (MAS) has announced their new business plan for year 2012‚ aiming to restore their profitability on the premium sector‚ as to become the preferred premium carrier. (Business Plan‚ Our Way Forward‚ December 2011‚ page7) By achieving the vision as to become the preferred premium carrier‚ they will be launching a new regional premium airline. In the first half of 2012‚ they will launch new short-haul brand‚ flying an entirely new Boeing 737-800 fleet
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This paper evaluates the key financial challenges facing organizations in Risk Management‚ Managing International Acquisitions‚ and Managing Working Capital simulations. Secondly‚ an evaluation of Southwest Airlines (SWA) management of working capital and the optimal financial strategies employed is presented. Also evaluated are the potential improvements in financial performance along with long-term and short-term strategies. Lastly‚ considered in this paper is whether a merger or acquisition
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2-Variable Inequality Here is an example of a problem very similar to the one in the Week Three Assignment: Catskills Hammock Company can obtain at most 2000 yards of striped canvas for making its full size and chair size hammocks. A full size hammock requires 10 yards of canvas and the chair size requires 5 yards of canvas. Write an inequality that limits the number of striped hammocks of each type which can be made. (b) First I must define what variables I will be using in my inequality
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