Exam 11: Decentralization, Performance Evaluation, and the Balanced Scorecard

Fleming Inc. manufactures and sells wooden bookshelves. Which of the following steps in the manufacturing cycle would be considered non-value added time?

Which of the following situations is most likely to pose a problem for companies that use return on investment (ROI) as a measure of a manager's performance?

A local chain department store grants each of its store managers the authority to make buying decisions for their stores. Granting managers this kind of authority is found in which type of organization?

Which of the following statements regarding the balanced scorecard approach is false?

Hillary Todd, a manager for BEO Inc., has been told that her bonus this year will be based on the segment margin of her department. Hillary is most likely a:

A system of improvement based on a series of gradual and often small improvements is called:

Carson Inc. Carson Inc. had the following information available at the end of its current year: Refer to the Carson Inc. information above. What was Carson's asset turnover for the year?

What is a potential disadvantage of using ROI as a performance measure for management?

Which of the following is the correct formula to compute residual income?

Which of the following statements about quality costs is true?

ABC Inc. has the following information available for one of its divisions: If ABC requires a minimum return on its investments of 20%, what is their residual income?

A company has computed that their "margin" is .18. Which of the following statements is the best interpretation of these results?

You are the manager of a new restaurant in town. List one method that you might use as a measure of quality.

Which types of quality costs are incurred after a defective product is delivered to a customer?

Which of the following statements about managerial compensation is correct?

Thompson Ltd. has a division that generated $7,500,000 in sales and operating income of $1,500,000 on average operating assets of $3,500,000. The company's management team expects division managers to generate sufficient income to guarantee a minimum return of 20 percent. Required:

Which type of manager would be allowed to decide whether or not new manufacturing equipment should be purchased?

Costs that can not be traced or reasonably allocated to a particular segment are called:

Pennington Products Pennington Products has two product lines: R-100 and R-200. Revenue and cost information for each of the product lines are as follows: Pennington has common fixed expenses of $380,000 per year. Last year, the company produced and sold 35,000 units of R-100 and 25,000 units of R-200. Refer to the Pennington Products information above. What is the company's overall net income?

HNW Ltd. HNW Ltd. manufactures and sells food processors. A popular consumer magazine has recently evaluated food processors and has ranked HNW's processors as being of "poor quality". As a result, HNW's management team has begun to analyze all costs associated with their food processors in more detail, and the following data has been compiled: Refer to the HNW Ltd. information above. What are HNW's total external failure costs?