Oriole Furniture, Inc. (A)
5 Pages Posted: 21 Oct 2008
This case first describes, in general terms, a fairly typical annual budgeting process for a division of a company. It then depicts, as of the end of May, the division's actual performance compared with where it should be. Based on where the division's results stand as of the end of May, students are asked to generate ideas regarding what to do during the remaining seven months in order to make budget.
Rev. Jun. 17, 2009
ORIOLE FURNITURE, INC. (A)
Bernard Mente, vice president of the Rattan Furniture Division of Oriole Furniture, Inc., was faced with a difficult decision in mid-June. He was wondering what he should do in light of his division's failure to meet sales and profit goals during the first five months of the year. Despite the recession, the division had managed to meet the sales and profit budget for the first three months, but the deepening recession had severely affected the results of the following two months.
Oriole Furniture, Inc., was a 30-year old distributor of high-quality, imported furniture. The company was organized into four divisions: Teakwood, Antiques, Rosewood, and Rattan. Four centralized staff departments were organized to support the product groups: finance and control, marketing, purchasing, and engineering. Each of the four product divisions was a profit center.
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Keywords: budgeting profit planning
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