The Demise of Resources Unlimited

The Demise of Resources UnlimitedLeanne CraftContentBaseline ProfitsGas AccountsSalaries for Entry-Level ManagementWarding off BankruptcyAvoiding DiscriminationCorporate Management StyleAccounting PracticesProfit StructureLines of CommunicationBaseline ProfitsBaseline: 1.087 BillionBaseline: 803 Million

Gas AccountsCurrent trends in 198832 Gas Accounts64 Oil AccountsRatio being provisional for forecasting to stay with same trend.32:64 is 50%Stay with the same trend in 1990Trending in 1990We know there are 86 Oil accounts To stay with the same trend then 50% of 86 would need to be the number of gas accounts Gas Accounts in 1990 43 Gas Accounts

Salaries for Entry-Level ManagementThe mean for what we know. Currently we know 4 out of 5 salaries. $50,000$55,000$52,000$32,000If we assume this is entry levelThe salary would be about $47,000 for starting management.

Warding Off BankruptcyFacts:It takes 500 gas accounts to maintain cash flows for 30 days.If this was occurring frequently that would mean thousands were being transferred.Not knowing the actually amounts:Every 6 months 3000 accounts would need to be transferred and each year 6000 accounts would have to be transferred.If this occurred from 1990 to 1994 anywhere from 18-24 thousand accounts were transferred to keep the company afloat.

Avoiding DiscriminationWe know that the top three employees were getting paid $55,000$50,000$52,000The standard deviation for these is $2,516.61To be considered discrimination there would need to be two standard deviations from the mean of the top threeWe can see that the mean is $52,333.33 and we would then subtract $2516.61 x 2. This gives us $5033.22 and we would then subtract that from $52333.33 for a total of $47300.11.This would prove the case for discrimination and that it was happening.Column1Mean52333.33333Standard Error1452.966315Median52000Mode#N/AStandard Deviation2516.611478

Corporate Management StyleThe CEO of Resources Unlimited ignored the information that was given to him by accountants.This could be considered to be immoral or unethicalIn todays world on Wall Street this would have created things such as watermelon stocksThe CEO also had a discrimination claim on his record and could be considered sexist

Accounting PracticesThe accountants wanted to follow the rules of accountingWanted to only report things that would be accurate and not skewed to Wall StreetFollow the regulations of the GAAP

Profit StructureBecause baseline profits were skewed this caused problems when real figures came inBecause the company was publicly traded the numbers being reported needed to be spot on for reporting

Lines of CommunicationBetween CEO and AccountantsPoor or ignoredThe regulations were not setBetween CEO and EmployeesBiasedCaused discrimination issues

QuestionsThank You For Your Time