Question

1. Managers of an) center are evaluated based on measures such as ROI and residual income 2. Suboptimal decisions and duplication of resources are considered disadvantages of 3. A positive results when managers invest in projects that eam more than the hurdle rate perspective focuses on processes required to meet customer needs through measures such as on-time delivery and 4. The qualty 5. The states that managers should be held responsible only for what they can control 6. measures the economic wealth that is created when a company's after tax operating income exceeds its cost of capital 7. The perspective typically contains leading indicators, which are measures that reflect future performance 8. A change in the investment turnover ratio from 1.5 to 3.2 will the division's ROI 9. The maximum transfer price is the 10. Goal results when there is conflict between a manager and the organization as a whole

Answer 1

1. Managers of a Investment Center are evaluated based on measures such as ROI and residual income.

2. Suboptimal decisions and duplication of resources are considered disadvantages of Decentralization.

3. A positive Residual income results when manager invest in projects that earn more than the hurdle rate.

4. The Internal business perspective focuses on process required to meet customer needs through measures such as on time delivery and quality.

5. The Controllability priniciple states that manager should be held responsible only for what they can control.

6. Economic Value Added(EVA) measures the economic wealth that is created when a company's after-tax operating income exceeds it's cost of capital.

7. The Learning and growth perspective typically contains leading indicators, which are measures that reflect future performance.

8. A change in the investment turnover ratio from 1.5 to 3.2 will Increase the division's ROI.

9. The maximum transfer price is the External market price.

10. Goal Incongruence results when there is conflict between a manager and the organisation as a whole.