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Management Accounting & Strategic Management

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MANAGEMENT ACCOUNTING

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You can often access financial information for most of the companies listed in the Dow-Jones Industrial Average by going to that company's website and looking for the Annual Report, often listed in the Investor Relations or Investor Info section. If you cannot find the information needed, try obtaining the financial information on file with the Securities and Exchange Commission by going to the SEC's information website- http://www.sec.gov/edgar.shtml .

Find the most recent annual financial statement information for the Safeway Corporation - http://www.safeway.com/IFL/Grocery/Home and the General Electric Corporation (GE) -http://www.ge.com/ . Based on your review of the most recent Statement of Cash Flows for each company, answer the following:

1. Ascertain whether Safeway and GE use the direct or indirect method of presenting operating activities.
2. Each site lists the last three years statement of cash flows. Determine the direction or trend of the overall cash flow position - and the direction or trend of each of the three activities (operating, investing, and financing) for both corporations.
3. From the items listed in the three parts of the statement, determine the reasons for the changes or trends.
4. Compare Safeway's cash flow statement with GE's in terms of the items in each and the "bottom line" results.

STRATEGIC MANAGEMENT
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What is a value proposition? For each of these brands, articulate your perception of their key value proposition:
Caterpillar earth mover
Apple iPod
Wii home gaming system*
McDonald's hamburgers
FedEx overnight delivery service

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Consider the concept of the value chain. Identify a firm that you believe does an especially good job of investing in elements in the value chain in order to gain higher profit margins versus competition. Which two or three elements in the value chain does that firm handle especially well? For each of those elements, what do they do that is better than their competition?

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The response addresses the queries posted in 715 words with references.

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// In this section, there will be a discussion on the use of indirect method of cash flow statement by the companies to present their financial statements. There will be focus on trends of cash flows among three different activities of cash flows statement.//

Safeway Company uses the indirect method to present cash flow changes in operating activities. General Electric Company also uses the indirect method to present cash flow changes in operating activities. The cash flow trends in General Electric Company in case of operating, investing and financing are fluctuating because there was an increase in cash flow in 2010, whereas in 2011 there is a decrease in cash flows (Financial Statements, 2012). It means there is no increasing and decreasing trend, rather fluctuating over the periods. In the case of Safeway Company, there is an increasing trend in operating activities of cash inflows, whereas increasing trends of cash flows in case of investment and financing activities. The causes of changes in the trend of cash flows in cash flow statement of Safeway Company are capital expenditures, purchase of stock, and changes in current liabilities. In the case of General Electric Company, the major causes of changes in trends are provision for losses on GECS financing activities, ...

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