Exam 11: Performance Measurement in Decentralized Organizations

The Portland Division's operating data for the past two years is as follows: The Portland Division's margin in Year 2 was 150% of the margin for Year 1. The sales for Year 2 were:

(Multiple Choice)

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Question 41

A manufacturing cycle efficiency (MCE)ratio close to 1.00 is desirable because this is the ratio of value-added time to throughput time.

(True/False)

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Question 42

Which of the following would be an argument for the use of net book value in the computation of operating assets in return on investment calculations?

(Multiple Choice)

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Question 43

Residual income is the net operating income that an investment center earns above the minimum required return on the investment in fixed assets.

(True/False)

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Question 44

Aguilera Industries is a division of a major corporation.Data concerning the most recent year appears below: The division's return on investment (ROI)is closest to:

(Multiple Choice)

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Question 45

If operating income is $60, 000, average operating assets are $240, 000, and the minimum required rate of return is 20%, what is the residual income?

(Multiple Choice)

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Question 46

Ebsen Corporation keeps careful track of the time required to fill orders.Data concerning a particular order appear below: The delivery cycle time was:

(Multiple Choice)

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Question 47

Daab Products is a division of a major corporation.The following data are for the most recent year of operations: The division's return on investment (ROI)is closest to:

(Multiple Choice)

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Question 48

The following data pertain to operations at Quick Incorporated: The wait time for this operation would be:

(Multiple Choice)

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Question 49

Move time is considered value-added time.

(True/False)

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Question 50

Return on investment is superior to residual income as a means of measuring performance because it encourages managers to make investment decisions that are more consistent with the interests of the company as a whole.

(True/False)

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Question 51

Return on investment (ROI)equals margin multiplied by turnover.

(True/False)

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Question 52

When used in return on investment (ROI)calculations, operating assets do not include investments in land held for future use and investments in other companies.

(True/False)

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Question 53

The West Division of Frede Corporation had average operating assets of $700, 000 and net operating income of $120, 800 in December.The minimum required rate of return for performance evaluation purposes is 16%. What was the West Division's minimum required return in December?

(Multiple Choice)

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Question 54

Hardenburg Corporation keeps careful track of the time required to fill orders.The times required for a particular order appear below: Required: a.Determine the throughput time.Show your work! b.Determine the manufacturing cycle efficiency (MCE), Show your work! c.Determine the delivery cycle time.Show your work!

(Essay)

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Question 55

The Jenkins Division recorded operating data as follows for the past year: For the past year, the turnover used in ROI calculations was:

(Multiple Choice)

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Question 56

The Portland Division's operating data for the past two years is as follows: The Portland Division's margin in Year 2 was 150% of the margin for Year 1. The average operating assets for Year 2 were:

(Multiple Choice)

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Question 57

Ok Corporation keeps careful track of the time required to fill orders.Data concerning a particular order appear below: The manufacturing cycle efficiency (MCE)was closest to:

(Multiple Choice)

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Question 58

Brandon, Inc.has provided the following data for last year's operations: Brandon's return on investment (ROI)is:

(Multiple Choice)

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Question 59

Land held for possible plant expansion would not be included as an operating asset when computing return on investment (ROI).

(True/False)

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Question 60

Showing 41 - 60 of 115

Exam 11: Performance Measurement in Decentralized Organizations

The Portland Division's operating data for the past two years is as follows: The Portland Division's margin in Year 2 was 150% of the margin for Year 1. The sales for Year 2 were:

A manufacturing cycle efficiency (MCE)ratio close to 1.00 is desirable because this is the ratio of value-added time to throughput time.

Which of the following would be an argument for the use of net book value in the computation of operating assets in return on investment calculations?

Residual income is the net operating income that an investment center earns above the minimum required return on the investment in fixed assets.

Aguilera Industries is a division of a major corporation.Data concerning the most recent year appears below: The division's return on investment (ROI)is closest to:

If operating income is $60, 000, average operating assets are $240, 000, and the minimum required rate of return is 20%, what is the residual income?

Ebsen Corporation keeps careful track of the time required to fill orders.Data concerning a particular order appear below: The delivery cycle time was:

Daab Products is a division of a major corporation.The following data are for the most recent year of operations: The division's return on investment (ROI)is closest to:

The following data pertain to operations at Quick Incorporated: The wait time for this operation would be:

Move time is considered value-added time.

Return on investment is superior to residual income as a means of measuring performance because it encourages managers to make investment decisions that are more consistent with the interests of the company as a whole.

Return on investment (ROI)equals margin multiplied by turnover.

When used in return on investment (ROI)calculations, operating assets do not include investments in land held for future use and investments in other companies.

The West Division of Frede Corporation had average operating assets of $700, 000 and net operating income of $120, 800 in December.The minimum required rate of return for performance evaluation purposes is 16%. What was the West Division's minimum required return in December?

The Jenkins Division recorded operating data as follows for the past year: For the past year, the turnover used in ROI calculations was:

The Portland Division's operating data for the past two years is as follows: The Portland Division's margin in Year 2 was 150% of the margin for Year 1. The average operating assets for Year 2 were:

Ok Corporation keeps careful track of the time required to fill orders.Data concerning a particular order appear below: The manufacturing cycle efficiency (MCE)was closest to:

Brandon, Inc.has provided the following data for last year's operations: Brandon's return on investment (ROI)is:

Land held for possible plant expansion would not be included as an operating asset when computing return on investment (ROI).

Managerial Accounting and Cost Concepts

Cost-Volume-Profit Relationships

Job-Order Costing

Variable Costing and Segment Reporting: Tools for Management

Activity-Based-Costing: a Tool to Aid Decision Making

Differential Analysis: the Key to Decision Making

Capital Budgeting Decisions

Profit Planning

Flexible Budgets and Performance Analysis

Standard Costs and Variances

Pricing Products and Services

Profitability Analysis

Least Squares Regression Computations

Activity-Based Absorption Costing

the Predetermined Overhead Rate and Capacity

Super-Variable Costing

Abc Action Analysis

the Concept of Present Value

Income Taxes and the Net Present Value Method

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Transfer Pricing

Service Department Charges

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