Henry Spots a Problem at Sunshine O.J. (A)

Henry Franklin works at Sunshine O.J. (Sunshine), a three-year-old, fast-growing organic orange juice manufacturer near Charleston, South Carolina. Before his employment at Sunshine, Franklin worked for about two decades in his family's business, Franklin's Hardware. Franklin learned a great deal during his time in the hardware business and hopes to use some of his insights to help Sunshine, which has been struggling to become profitable. This A case introduces inventory generally and highlights differences between “last in, first out” (LIFO) and “first in, first out” (FIFO) accounting. Franklin's manager asks him to prepare a LIFO/FIFO analysis for Sunshine based on real data so that he can present it in a management meeting. Excerpt UVA-OM-1614 May 16, 2019 Henry Spots a Problem at Sunshine O.J. (A) Introduction Henry Franklin was already imagining the praise that would come from his new boss, Virginia Silverstein. The broad smiles, the calls from upper management congratulating him, the career fast track. He could see it all unfolding in his mind's eye. It wasn't every day that the new guy, the guy who didn't even graduate from college, had a chance to stand out like this. Franklin smiled as he pulled his Honda Civic into his usual parking spot at Sunshine O.J. (Sunshine), an organic orange juice manufacturer near Charleston, South Carolina. Sunshine was a relatively new player in the orange juice game—only three years old, but growing fast. The founders had seen an opportunity to steal market share from the entrenched leaders—Tropicana, Minute Maid, Florida's Natural, and Simply Orange—by sourcing their oranges from an organic farm in Brazil. The juice had won praise from critics for its creamy, low-acid flavor and healthy aftertaste. . . .