Assignment+One - Management C31 Summer Term, 2010...

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Management – C31 Summer Term, 2010 Assignment One The Case Allan and Bella run a large store selling art and high-end home furnishings. Their store is called The Good Life. They have no formal agreement in place but they routinely refer to one another as “partner.” When the business was first started Allan did the majority of work in getting it established while Bella contributed a greater share in the capital. Since then, however, they have both shared equally in the profits of the business and have worked similar numbers of hours each week. Bella has two young children and for some time her husband was staying home with them. Last year, however, he returned to work and so Bella needed to spend more time at home with her kids. As a result, she began working fewer hours. Allan was not able to keep up the store alone and so he and Bella agreed to hire his nephew, Verne, to work some hours in the shop. Paying Verne was a bit of a problem because the store wasn’t doing very well. At first they agreed that Verne would receive a straight 20% commission on everything he sold. In practice, however, it became difficult to separate his sales from the rest. So instead they did a rough calculation to determine the break- even point for the store and Verne now receives 20% of all profit beyond this point. Some months Verne receives nothing but other months he does quite well.
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Assignment+One - Management C31 Summer Term, 2010...

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