Provide an analysis of the three territories of Jason Ltd

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Reference no: EM133133312

Question - You have been provided with the profitability analysis of Jason Ltd, which has been extracted from the latest reports submitted by the company's Great Britain sales territories.

 

England £000

Wales £000

Scotland £000

Total £000

Sales

800

900

800

2500

Variable costs

(356)

(418)

(488)

(1262)

Fixed costs

(156)

(208)

(348)

(712)

Profit/ (Loss)

288

274

(36)

526

Jason Ltd conducted a special study on the activities and profitability of its Great Britain territories and obtained the following information:

1. £248,000 of Scotland fixed costs and all variable costs are avoidable.

2. £100,000 of Scotland fixed costs are unavoidable if the Scotland territory is discontinued.

Required -

1. Provide an analysis of the three territories of Jason Ltd and advice the company if it should keep Scotland territory open or discontinue Scotland.

2. Assuming the company decides to discontinue Scotland territory, discuss all the implications for cost management and growth within the organisation. Will there be any implication for value-chain management?

Reference no: EM133133312

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