Answer

Letter Concerning Deductibility

Your Name

Your Street Address

Your City, State Zip

February 14, 2021

Mr. Mason

Chief Executive Officer

Brickman, Inc.

Street Address

City, State Zip

Dear Mr. Mason:

I trust this letter finds you well. I am writing to you concerning the deductibility of the payments made to Mr. Don. I have outlined various facts, issues, conclusions, and reasoning concerning this matter.

Facts

Below are the identified facts

• The issue at hand comprises deductibility under Sec. 162 (a) of legal bribes and kickbacks as necessary and ordinary expenditures. An ordinary expenditure is one that individuals in given business practice and accept as usual, whereas necessary expenditure aids or is significant for your trade.
• Nobody witnessed the transactions between you and Mr. Don.
• Brickman, Inc. was the low bidder for the tender.
• The payments you made were legal under state law.

Issues

Below are the issues

• Since there were no witnesses or proof of payment, there is no evidence that you made payments to Mr. Don.
• Issuing kickbacks are ordinary in your trade, but since Brickman Inc. had the low bid, it would get the tender without giving the kickback. Therefore, the kickback was not necessary.
• The payment made was legal, and no evidence of coercion or threats from Mr. Don.

Conclusion

The deductibility of the payments you paid to Mr. Don is not possible. Meaning you, as a person or as Brickman Inc., cannot deduct the payments made to Mr. Don.

Reasoning

Based on Sec. 162 (a) (3), “no deduction shall be allowed under subsection (a) for any kickback, rebate, or bribe made by any provider of services …” you are not able to deduct the payments made to Mr. Don.

There is no evidence that you actually paid Mr. Don any money. The payments were usually through third parties, and you are not capable of linking it directly to Mr. Don, who can argue that he never received any payment from you. There is no proof of payment since the payments were through cash.

The law requires that expenditure made should be both ordinary and necessary. In your case, the expenditure was ordinary since it is a common trait to give kickbacks to get tenders. Since Brickman was the lowest bidder than the others, the tender should have been yours without giving any kickback, and the kickback was not significant in helping your business. From that logic, your expenditure was not necessary. Since your case does not meet both conditions for ordinary expenditure and necessary expenditure, you cannot deduct the payments made to Mr. Don.

Sincerely,

[Name]

47.QUESTION

Analysis of CPM Matrix for Disney    

Step 4: Prepare a CPM that includes the team’s company and two primary competitors.

Step 5: In 250-350 words, write a brief explanation of the findings and implications of the data identified in the CPM.

**I have already completed the CPM matrix for you to use as a reference. I have also attached a word document that includes more information about Disney from our book.

**This is our book we are using:
David, F. R., David, F. R., & David, M. E. (2020). Strategic management concepts and cases: A competitive advantage approach (17th ed.). New York, NY: Pearson Education. ISBN-13: 9780135203699

ANSWER

Analysis of Competitive Profile Matrix (CPM) for Disney

The competitive Profile Matrix (CPM) serves as a tool that compares companies and their rivals and reveals their relative weaknesses and strengths (David, David, and David, 2020). The table below shows the outcomes of the CPM for Disney:

Table I: Outcome of the CMP for Disney

In the above table, it can be noted that the critical success factors in the industry are advertising, market penetration, customer service, store location, research and development, employee dedication, and financial profit. Other CSFs in the industry are customer loyalty, market share, product quality, top management, and price competitiveness. Critical success factors (CSF) involve the primary areas that establish companies’ success within an industry. Disney’s primary competitors are Comcast and CBS. Bhattacharjee (2015) asserts that firms can succeed in an industry when they perform at their highest possible levels of excellence. Disney’s highest level of performance exist in the areas of market penetration, customer services, financial profit, customer loyalty, and market share, where the rating is 4 for each of these areas. However, the company has minor strength in the areas of product quality and price competitiveness, where the score each of these areas is 3. On the other hand, the firm has minor weakness in the areas of top management, employee dedication, store locations, and advertising, where the rating for each of these areas is 2. The company’s major weakness exists in the area of research and development, where the rating is 1. Nonetheless, the most significant CSFs for Disney’s success based on weighting are advertising (0.15), market penetration (0.13), customer service (0.07), financial profit (0.13), customer loyalty (0.08), product quality (0.08), top management (0.08), and price competitiveness (0.08).  Among these areas, Disney registers the highest level of performance in the areas of market penetration, customer service, financial profit, and customer loyalty. The company has minor strength in the area of product quality and price competitiveness. Disney has minor weakness in the areas of top management and advertising. The implication of these findings is that Disney should focus on improving the areas of product quality, price competitiveness, top management and advertising for the company to realize success in the industry. Moreover, more resources should be invested in the areas of advertising and top management relative to price competitiveness and product quality, where the company scores the lowest or is the weakest relative to its key rivals, CBS and Comcast.

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