Link: http://www.cbc.ca/consumer/story/2008/09/11/credit-fees.html
Summary:
On September 11, 2008, the public was notified about credit card companies gouging retailers with transaction fees that cost $4.5 billion in 2007 - and the costs being trickled down to consumers. A newly formed group campaign called "Stop Sticking it to Us" was against the credit card companies, and gave us information about these companies. They estimated that nearly $2 of every $100 Canadians spent using credit cards went directly to Visa and MasterCard, and their issuing banks. Most of money comes from so-called "interchange fees" that Visa and MasterCard banks collect from merchants every time a credit or debit card is used to pay for a purchase. The fees vary depending on the type of card, the size of merchant, but the fees are calculated as a percentage of the transaction. The council pointed out that the interchange fees were not only a problem for merchants, but for consumers as well as the fees would eventually trickle down to them. The money earned from interchange fees goes to cover the cost of credit card incentive programs, corporate credit card benefits, and junk mail. A result and comparison of these types of fees having an impact on merchants and consumers was that "a member of the Stop Sticking it to Us campaign, in one month saw their processing fees.. increase by over $1200." Additional information that you might want to know is that the personal credit card fees increased from 1.6 to 1.7%, and business fees increased significantly.
Connections:
The connection I made between the article and chapter 14 is Credit Card Charges. When the merchant is paid by the consumer with a credit card, the credit card company such as Visa or MasterCard, gets a portion of the gross amount of the credit card transaction. This portion is accumulated by a certain percentage (in the article's case, 1.7%) , and the credit card company gets this amount of cash for every transaction received by a retailer from a consumer using their credit card. Another connection I made was that in both the article and chapter 14, it both noted that "credit cards are more cost-effective than handling cash, and are used so much in today's society that we can visualize a society without money - a cashless society".
Reflection:
After the article about credit card company fees being unreasonable, the day after, credit card company, Visa stated that its interchange rates were reasonable. After careful analysis, I have concluded that the fees charged by credit card companies are reasonable! I think they are reasonable because as today's society is using more and more credit cards instead of cash, companies can charge high prices, but still reasonable price as the demand for credit cards are rising instead of the use of cash. My opinion about the consumer's credit card charges rising by over $1200 can be bias as we only know HE is the only one that had his credit charges go up. Personally this is not an issue for me now as I do not use credit cards, but it might be an issue for me as i get older and start using a credit card. If the fees get too high, then it might be a problem we will want to resolve now! How high are you willing to pay for the use of credit cards?
Friday, November 21, 2008
Thursday, October 30, 2008
Accounting 12 - Chapter 12
Link: http://www.cbc.ca/consumer/story/2008/10/29/pe-gas-discounts.html
Summary:
Recently, on Prince Edward Island, Wilsons Fuel has been told by the provincial regulator to stop giving a two-cent-a-litre discount to consumers who pay cash for gasoline. The island regulator was responding to the complaints that the discounts at Wilsons Fuel was charging less than the regulated minimum price for gas. The area manger Doug MacDonald saw no problems in offering his discounts because he saw it similar to other gas stations such as Petro Points at Petro Canada, and Esso Extra Points at Esso. The reason why giving such a discount like the one at Wilsons Fuel is bad is because the discount lowers the prices of gas below minimum price, and it eliminates the charges that would otherwise go to the credit card company for the costumer using the credit card. In the recent ruling of this week, IRAC disagreed that the cash discounts is in the same category as other incentive programs (such as Petro Points), and ordered a stop. The Legislation allows incentives, but not direct cash discounts. Wilsons Fuel will have to find another way to offer its customers a discount.
Connections:
The connections I made between the article and chapter 12 is Cash Discounts. Wilsons Fuels was trying to give a discount to those who paid cash for gasoline, and it connects to how cash discounts are a reduction of the amount of a bill if payment is made on or before the discount date stated on the bill. In Wilsons Fuels' case, all they did was give a discount to their customers for paying cash, which is technically on time (Cash on Delivery).
Reflection:
I myself do not see any differences between giving a discount for paying cash for gasoline and giving incentives at other gas stations like Petro Points at Petro Canada. Either way, they both reduce the prices of gasoline and is a plus for the consumers. I agree with Doug MacDonald point of view, who said what they were trying to do was offer that money (from credit card charges) back to the customer, which the customers would have to pay to the credit card companies for using their credit card otherwise. Finally, relating to the discounts on gas prices, I believe that regulations for gas prices should not be so strict because gas prices are high enough as it is, and a few cents off per litre will not hurt anybody. What world has it become where money has became the main thought of the world?
Summary:
Recently, on Prince Edward Island, Wilsons Fuel has been told by the provincial regulator to stop giving a two-cent-a-litre discount to consumers who pay cash for gasoline. The island regulator was responding to the complaints that the discounts at Wilsons Fuel was charging less than the regulated minimum price for gas. The area manger Doug MacDonald saw no problems in offering his discounts because he saw it similar to other gas stations such as Petro Points at Petro Canada, and Esso Extra Points at Esso. The reason why giving such a discount like the one at Wilsons Fuel is bad is because the discount lowers the prices of gas below minimum price, and it eliminates the charges that would otherwise go to the credit card company for the costumer using the credit card. In the recent ruling of this week, IRAC disagreed that the cash discounts is in the same category as other incentive programs (such as Petro Points), and ordered a stop. The Legislation allows incentives, but not direct cash discounts. Wilsons Fuel will have to find another way to offer its customers a discount.
Connections:
The connections I made between the article and chapter 12 is Cash Discounts. Wilsons Fuels was trying to give a discount to those who paid cash for gasoline, and it connects to how cash discounts are a reduction of the amount of a bill if payment is made on or before the discount date stated on the bill. In Wilsons Fuels' case, all they did was give a discount to their customers for paying cash, which is technically on time (Cash on Delivery).
Reflection:
I myself do not see any differences between giving a discount for paying cash for gasoline and giving incentives at other gas stations like Petro Points at Petro Canada. Either way, they both reduce the prices of gasoline and is a plus for the consumers. I agree with Doug MacDonald point of view, who said what they were trying to do was offer that money (from credit card charges) back to the customer, which the customers would have to pay to the credit card companies for using their credit card otherwise. Finally, relating to the discounts on gas prices, I believe that regulations for gas prices should not be so strict because gas prices are high enough as it is, and a few cents off per litre will not hurt anybody. What world has it become where money has became the main thought of the world?
Sunday, October 5, 2008
Accounting 12 - Chapter 11
Link: http://www.cnn.com/2008/WORLD/asiapcf/10/05/china.milk/index.html
Summary:
An event that occurred in Hong Kong, China, was candy filled high levels of melamine. Basically the article is about how the Hong Kong authorities on Sunday October 5, 2008 have announced that two recalled candy products made by British confectioners, Cadbury had high levels of melamine. What is melamine, you ask? Melamine is a white chemical crystalline compound (C3H6N6) used in making melamine resins, and to bolster apparent protein levels in diluted or poor-quality milk. Melamine has been recently been found in the Chinese-made milk products that have sickened nearly 53,000 children in China, killing four. So far, countries have banned the import of Chinese milk products, or anything that contains milk from China. Last week, Cadbury recalled all of its Chinese-made candy products after tests have shown they contained amounts of melamine. Spokesman Tony Bilsborough said they took the action because, "no level of melamine is appropriate". The test results of their products showed that their Dairy Milk Hazelnut Chocolate contained 25 times the acceptable 2.5 ppm (parts per million) amount of melamine, and their Dairy Milk Cookies Chocolate contained more than twice the legal limit of melamine. The same melamine has been used in milk a month ago in an attempt to sell more of it, and in order to fool quality checks. So far, authorities have arrested 40 people in connection with the scandal, including two brothers who could face the death penalty if convicted.
Connections:
The connections I made between the article and chapter 11 is Merchandise Returns and Allowances, and COGS. People who have found the product unsatisfactory or unhealthy in this case, can get a refund on the product that they bought which has to do with returns and allowances. With vast amounts of the useless candy, chocolate, and milk which will have to be included on the income statement as COGS (goods that are lost, broken, or stolen), the company will have a large amount of returns and allowances that they will have to give back to their customers, and because of the possible law suits that may occur, I predict Cadbury will go out of business.
Reflection:
Although the article talks a lot about how China has had melamine in two companies now (one in milk products, and one in candy products), the article or other news stories does not talk about any law suits that the people in China have against the companies. I think this is idiotic because if this happened in Canada two times within a month, the people in Canada would be outraged! The comparison I make between Canada's government and China's government is that Canada thinks lives are precious, and China's government thinks lives are not precious because of the gigantic population of people in China. If Canada or the United States were to make a move saying that what China is doing is wrong (which we will not), China would cut off all exports to Canada or the United States. When will China's government finally make a stop to the poor products the companies in China are making?
Summary:
An event that occurred in Hong Kong, China, was candy filled high levels of melamine. Basically the article is about how the Hong Kong authorities on Sunday October 5, 2008 have announced that two recalled candy products made by British confectioners, Cadbury had high levels of melamine. What is melamine, you ask? Melamine is a white chemical crystalline compound (C3H6N6) used in making melamine resins, and to bolster apparent protein levels in diluted or poor-quality milk. Melamine has been recently been found in the Chinese-made milk products that have sickened nearly 53,000 children in China, killing four. So far, countries have banned the import of Chinese milk products, or anything that contains milk from China. Last week, Cadbury recalled all of its Chinese-made candy products after tests have shown they contained amounts of melamine. Spokesman Tony Bilsborough said they took the action because, "no level of melamine is appropriate". The test results of their products showed that their Dairy Milk Hazelnut Chocolate contained 25 times the acceptable 2.5 ppm (parts per million) amount of melamine, and their Dairy Milk Cookies Chocolate contained more than twice the legal limit of melamine. The same melamine has been used in milk a month ago in an attempt to sell more of it, and in order to fool quality checks. So far, authorities have arrested 40 people in connection with the scandal, including two brothers who could face the death penalty if convicted.
Connections:
The connections I made between the article and chapter 11 is Merchandise Returns and Allowances, and COGS. People who have found the product unsatisfactory or unhealthy in this case, can get a refund on the product that they bought which has to do with returns and allowances. With vast amounts of the useless candy, chocolate, and milk which will have to be included on the income statement as COGS (goods that are lost, broken, or stolen), the company will have a large amount of returns and allowances that they will have to give back to their customers, and because of the possible law suits that may occur, I predict Cadbury will go out of business.
Reflection:
Although the article talks a lot about how China has had melamine in two companies now (one in milk products, and one in candy products), the article or other news stories does not talk about any law suits that the people in China have against the companies. I think this is idiotic because if this happened in Canada two times within a month, the people in Canada would be outraged! The comparison I make between Canada's government and China's government is that Canada thinks lives are precious, and China's government thinks lives are not precious because of the gigantic population of people in China. If Canada or the United States were to make a move saying that what China is doing is wrong (which we will not), China would cut off all exports to Canada or the United States. When will China's government finally make a stop to the poor products the companies in China are making?
Wednesday, October 1, 2008
The New Seating Changes
The financial accounting 12 group has invaded the accounting 12's personal space and they shall regret it because all actions shall be made to PROCECUTE them (Jason,Kyron,and Cameron). They have moved from the window seats to directly infront of me and my companions. This is an outrage! I hope they see this......
SAVE MEEEEEEEE!!!!
-P. Ngo
SAVE MEEEEEEEE!!!!
-P. Ngo
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