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    Software giant Amcott posted a year end operating loss of $3. Million of which $1. Million stemmed out of its foreign language. Amcott decided to use $20 million of its retained earnings to purchase 3-year rights to Magicword, a software package that converts generic word processor files saved as French text into English. First year sales revenue was $7 million, but thereafter sales were halted pending a copyright suit filed by foreign Inc.

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    Headline 32 1

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    sghvicky
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    Software giant Amcott posted a year end operating loss of $3. Million of which $1. Million stemmed out of its foreign language. Amcott decided to use $20 million of its retained earnings to purchase 3-year rights to Magicword, a software package that converts generic word processor files saved as French text into English. First year sales revenue was $7 million, but thereafter sales were halted pending a copyright suit filed by foreign Inc.

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    Software giant Amcott posted a year end operating loss of $3. Million of which $1. Million stemmed out of its foreign language. Amcott decided to use $20 million of its retained earnings to purchase 3-year rights to Magicword, a software package that converts generic word processor files saved as French text into English. First year sales revenue was $7 million, but thereafter sales were halted pending a copyright suit filed by foreign Inc.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    4K views5 pages

    Headline 32 1

    Uploaded by

    sghvicky
    Software giant Amcott posted a year end operating loss of $3. Million of which $1. Million stemmed out of its foreign language. Amcott decided to use $20 million of its retained earnings to purchase 3-year rights to Magicword, a software package that converts generic word processor files saved as French text into English. First year sales revenue was $7 million, but thereafter sales were halted pending a copyright suit filed by foreign Inc.

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    Headline

    Amcott loses $3.5 million; Manager Fired

    Facts and figures

    Software giant Amcott posted a year end operating loss of $3.5 million of which $1.7 million stemmed out of its foreign language Earlier at interest rates 7 percent Amcott decided to use $20 million of its retained earnings to purchase 3-year rights to Magicword, a software package that converts generic word processor files saved as French text into English

    Report contd

    First year sales revenue was $7 million, but thereafter sales were halted pending a copyright infringement suit filed by Foreign Inc. Amcott lost suit and paid damages of $1.7 million Ralph, the Amcott manager was fired He claimed that he had predicted the projected annual sales of $7 million per year for three years and blamed it on the attorney of the company

    Objective of this case


    To identify why Ralph was fired? Managers Role Microeconomic tools required

    Calculation of the Value of the Project Magic word


    TR in $ 7 (1+r)t 1.07 TR/ (1+r)t 6.542056

    7 7

    1.1449 1.225043
    Total value of predicted sales in 3 years

    6.114071 5.714085

    18.37021

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