Dell Analysis Managerial Accounting

When we look at Dell Corporation’s 10-K filing, we can see what business strategy Dell intends to utilize. Dell uses direct customer sales combined with a successful manufacturing and supply chain management to compete successfully in the marketplace. The company relies on consumer intimacy and product leadership consumer value position. This is evidenced by their determination to provide the best value to the customer, the direct interaction with consumers and single point of contact for problem solving.

There are numerous risk factors Dell faces that can threaten the ability to satisfy stockholder expectations. One factor that Dell has no control over is the general economy. If the economy is tight consumer will put off spending money on updating technology in favor of more necessary purchases. Dell must retain its competitive advantage allowing them to continue offering advanced technology at low prices. Dell must review anticipated estimates of profit margins by product and geographical area. Managing product transitions is a key to successfully meeting stockholder expectations.

The Sarbanes-Oxley Act of 2002 affected the disclosures that must be included in Dell’s 10-K report. If there is any need for a change in the accounting process or procedures there needs to be a note included in the 10-K submitted to the SEC. Any discrepancies or disagreements between the auditors and Dell need to be disclosed. By providing this information to potential investors it gives full disclosure for the investors to make their decision.

Dell is a merchandiser because they focus on providing low cost products to the consumers. According to the information contained in the 10-K Dell controls all aspects of production, research, marketing and selling of their products. They do not need to employ outside manufacturers or merchandisers to sell their product.

Direct inventory costs are costs associated with producing the product. Such expenses as power...