Guillermo Furniture Store Scenario
Asia Walton
June 04, 2011
Karen Young

Guillermo Furniture Store Scenario
The Guillermo Furniture Store was successful at their manufacturing plant in Sonora, Mexico in the 1980s. However, within a decade the company had competition internationally. Also, a large retailer opened headquarters in Sonora where Guillermo leading manufacturing plant is located. Thus the changes occurring surrounding the Guillermo company created an increase of costs in labor and material. Thus, causing profits margin to reduce at the Company. To stay at a successful business pace, Guillermo had with three options: have automaton production, become a distributor or set apart its product(University of Phoenix, 2009).
Before deciding which option to undergo Guillermo must consider budgets and performance reports and how they can are used in the decision making procedure. Also Guillermo must take in to account of ethical and unethical ethics influences in accounting decisions. Finally Guillermo needs to know what accounting information is best when implanting the decision process. Planning and control are the two decisions that the company needs to undergo.
A budget is a numerical countenance that is planned. A performance report entails feedback of comparative results, and also highlight its variances (Burgstahle et al, 2008, p. 10). Guillermo can use budget and performance to be very helpful. If Guillermo chooses to sell the retardant stain the company can compare its cost of product value and labor to forecast a more profitable income. Budgeting can also be an option to use when determining the profit by becoming a distributor.
Performance reports can ensure proportional numbers the company is up against. Using the income information report, the company has calculated the expected net income before taxes
“The purpose of ethics in business is to direct business men and women to abide by a code of conduct that facilitates, if not...