Exam 8: Performance Evaluation for Decentralized Operations

Income from operations for Division L is $250,000, total service department charges are $400,000 and operating expenses are $2,750,000.What are the revenues for Division L?

Which of the following expenses incurred by the sporting goods department of a department store is a direct expense?

An activity base is used to charge service department expenses.Match each of the following activity bases with the appropriate department a-h. -Number of advertising campaigns

What will the income of the Super Division be after all service department allocations?

How much will Division 6's income from operations increase?

The sales, income from operations, invested assets, and residual income for each division of Marcus Company are as follows: Determine the minimum rate of return for invested assets.

Income from operations for Division H is $220,000, and income from operations before service department charges is $975,000.As a result,

Miller's Quarter Horse Company has sales of $4,500,000.It also has invested assets of $2,500,000 and operating expenses of $3,800,000.The company has established a minimum rate of return of 7%. a What is Miller's profit margin? b What is the investment turnover? c What is the rate of return on investment? d What is Miller's residual income?

Match each definition that follows with the term a-e it defines. -Earned by profit centers

Which of the following is a measure of a manager's performance working in an investment center?

The profit center income statement should include only controllable revenues and expenses.

Ralston Company has income from operations of $75,000, invested assets of $360,000, and sales of $790,000. Use the DuPont formula to calculate the rate of return on investment, and show a the profit margin, b the investment turnover, and c rate of return on investment.Round the profit margin percentage to two decimal places and the investment turnover to three decimal places.

Division A reported income from operations of $975,000 and total service department charges of $675,000.As a result,

The profit margin is the

The ratio of sales to invested assets, which is also a factor in the DuPont formula for determing the rate of return on investment, is called

An activity base is used to charge service department expenses.Match each of the following activity bases with the appropriate department a-h. -Number of miles

Match each of the following phrases as describing a an advantage, b a disadvantage, or c neither of decentralization. -Internal price wars

How much service department cost will be allocated to the Micro Division?

Which of the following is not one of the common types of responsibility centers?

The best measure of managerial efficiency in the use of investments in assets is