Exam 10: Flexible Budgets and Performance Analysis

Emerich Corporation keeps careful track of the time required to fill orders.The times recorded for a particular order appear below: The manufacturing cycle efficiency (MCE)was closest to:

The Jenkins Division recorded operating data as follows for the past year: For the past year,the return on investment was:

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

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?

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?

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

Baad Industries is a division of a major corporation.Last year the division had total sales of $20,440,000,net operating income of $1,860,040,and average operating assets of $7,000,000. The division's turnover is closest to:

The Jenkins Division recorded operating data as follows for the past year: For the past year,the minimum required rate of return was:

Fruchter Corporation keeps careful track of the time required to fill orders.The times recorded for a particular order appear below: The throughput time was:

Faas Wares is a division of a major corporation.The following data are for the latest year of operations: Required: a.What is the division's return on investment (ROI)? b.What is the division's residual income?

All profit centers are responsibility centers,but not all responsibility centers are profit centers.

Given the following data: The residual income would be:

Aguilera Industries is a division of a major corporation.Data concerning the most recent year appears below: The division's turnover is closest to:

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.

Jolin Corporation keeps careful track of the time required to fill orders.The times recorded for a particular order appear below: The delivery cycle time was:

Throughput time is the amount of time required to process raw materials into completed products.

The Consumer Products Division of Mickolick Corporation had average operating assets of $450,000 and net operating income of $38,700 in August.The minimum required rate of return for performance evaluation purposes is 10%. What was the Consumer Products Division's residual income in August?

Operating assets include cash,accounts receivable,and inventory but not any depreciable fixed assets.

Manufacturing Cycle Efficiency (MCE)is computed as:

Koogle Corporation uses residual income to evaluate the performance of its divisions.The company's minimum required rate of return is 13%.In August,the Commercial Products Division had average operating assets of $530,000 and net operating income of $76,700.What was the Commercial Products Division's residual income in August?