Reference no: EM13898828

Operations Management

The company has taken the following decisions for the purpose of various fares of the operations:

22B - 400miles - Regular Fare

23C - 340miles - Regular Fare

24D - 360miles - One-Month Sale

25E - 400miles - Two-Month Sales

On the basis of the overall analysis of the key business forms and the key expenses it can be said that the decision taken has been taken considering each and every item of expenses and that there is proper control over the expenses and the overall management of the expenses. It is understandable that the management has made the adjustment for the various prices and the various analysis of the key costs, and after the same the decision to make the fares and the overall expenses have been considered. We would consider each of the decisions individually to review the management intention and then bring a confirmation for the reason for such decisions.

Case 1 - The distance covered is sufficiently large and hence the costs would be spreadup. There is a general consideration for the economies of costs and that has found its relevance in this area. Hence regular fares can be charged to the guests accordingly.

Case 2 - In this instance also the distance covered is large. However there is also large number of passengers to share the overall costs and hence to ensure the benefit of the costs changes and the relative impact of the changes. There is a general consideration of the key costs and the key aspects of the enterprise on an overall manner.

Case 3 - Since the distance has reduced and so has the passengers, there has to be additional levy of the costs and the expenses accordingly to ensure that there is proper accounting and the privity to the contract is well ensured.

Case 4 - With the addition of the distance there is addition of passengers and also the overall form of management of the enterprise. It is therefore important for the concern to ensure proper management of those key concerns for proper accounting and proper control purpose. Hence the adequate approvals are required for this purpose and hence the same would be required for the purpose of proper allowance consideration.