Question 1

Which of the following is a potential advantage of decentralization?

Accepted Answer

A) Benchmarking 
B) Promotes goal congruence and coordination 
C) Provides feedback 
D) Provides training

Question 2

What is The Plastic Lumber Company's Outdoor Furniture Division profit margin?

Accepted Answer

A) 9.52% 
B) 20.00% 
C) 40.00% 
D) 200.00%

Question 3

The central reservation office at American Airlines is most likely treated as a(n)

Accepted Answer

A) cost centre. 
B) investment centre. 
C) profit centre. 
D) revenue centre.

Question 4

Which of the following perspectives from the balanced scorecard focuses on determining if customers are happy after the sale takes place?

Accepted Answer

A) Learning and growth perspective 
B) Internal business perspective 
C) Customer perspective 
D) Financial perspective

Question 5

Comparing actual results to the results of competitors and comparing actual results to industry standards would be an example of

Accepted Answer

A) promoting goal congruence and coordination. 
B) motivating managers. 
C) providing feedback. 
D) benchmarking.

Question 6

Which of the following aspects of a performance evaluation system best describes when a company's actual results are compared to the results of competitors?

Accepted Answer

A) Motivating unit managers 
B) Promoting goal congruence 
C) Benchmarking 
D) Communicating expectations

Question 7

What is the Tandem division's Return on Investment (ROI)?

Accepted Answer

A) 7.50% 
B) 12.00% 
C) 24.00% 
D) 200.00%

Question 8

What is the Entertainment Division's profit margin?

Accepted Answer

A) 11.11% 
B) 20.00% 
C) 48.00% 
D) 240.00%

Question 9

The laundry department for a Ritz-Carlton hotel is likely to be classified as a(n)

Accepted Answer

A) cost centre. 
B) investment centre. 
C) profit centre. 
D) revenue centre.

Question 10

Which of the following is a potential disadvantage of decentralization?

Accepted Answer

A) Benchmarking 
B) Duplication of costs 
C) Provides feedback 
D) Provides training

Question 11

Providing bonuses to subunit managers who achieve performance targets would be an example of

Accepted Answer

A) promoting goal congruence and coordination. 
B) motivating managers. 
C) providing feedback. 
D) benchmarking.

Question 12

What is the First Electronics Corporation cell phone division's profit margin?

Accepted Answer

A) 200.00% 
B) 15.00% 
C) 25.00% 
D) 30.00%

Question 13

The Hotel Division of Treasure Island Corporation had the following results last year.
  
Management's target rate of return is 14% and the weighted average cost of capital is 10%.Its effective tax rate is 35%.
Required:
1.Calculate the return on investment (ROI).
2.Calculate the residual income.
3.Calculate the Economic Value Added (EVA).

Accepted Answer

The answer of The Hotel Division of Treasure Island Corporation...

Question 14

Asset turnover is calculated as sales divided by total assets.

Accepted Answer

A) True 
 B)False

Question 15

The Frito-Lay division of PepsiCo is most likely treated as a(n)

Accepted Answer

A) cost centre. 
B) investment centre. 
C) profit centre. 
D) revenue centre.

Question 16

The Tandem division of the Great Adventures Cycles Company had the following results last year (in thousands).

Management's target rate of return is 10% and the weighted average cost of capital is 8%.Its effective tax rate is 40%.
What is the Tandem division's Economic Value Added (EVA)?

Accepted Answer

A) $136,000 
B) $152,000 
C) $280,000 
D) $288,000

Question 17

Which of the following perspectives from the balanced scorecard helps managers answer the question,"How do we look to shareholders?"

Accepted Answer

A) Learning and growth perspective 
B) Internal business perspective 
C) Customer perspective 
D) Financial perspective

Question 18

Operations is one factor of the internal business perspective of the Balanced Scorecard.

Accepted Answer

A) True 
 B)False

Question 19

Sarasota Corporation has operating income of $72,000,a profit margin of 12%,and asset turnover of 3.0.The return on investment (ROI)for Sarasota Corporation would be closest to

Accepted Answer

A) 1%. 
B) 4%. 
C) 36%. 
D) 120%.

Question 20

Which of the following financial performance measures can be used to compare potential projects of different sizes?

Accepted Answer

A) EVA 
B) Residual income 
C) ROI 
D) Operating income

Exam 11: Performance Evaluation and the Balanced Scorecard

Which of the following is a potential advantage of decentralization?

What is The Plastic Lumber Company's Outdoor Furniture Division profit margin?

The central reservation office at American Airlines is most likely treated as a(n)

Which of the following perspectives from the balanced scorecard focuses on determining if customers are happy after the sale takes place?

Comparing actual results to the results of competitors and comparing actual results to industry standards would be an example of

Which of the following aspects of a performance evaluation system best describes when a company's actual results are compared to the results of competitors?

What is the Tandem division's Return on Investment (ROI) ?

What is the Entertainment Division's profit margin?

The laundry department for a Ritz-Carlton hotel is likely to be classified as a(n)

Which of the following is a potential disadvantage of decentralization?

Providing bonuses to subunit managers who achieve performance targets would be an example of

What is the First Electronics Corporation cell phone division's profit margin?

Asset turnover is calculated as sales divided by total assets.

The Frito-Lay division of PepsiCo is most likely treated as a(n)

The Tandem division of the Great Adventures Cycles Company had the following results last year (in thousands) . Management's target rate of return is 10% and the weighted average cost of capital is 8%.Its effective tax rate is 40%. What is the Tandem division's Economic Value Added (EVA) ?

Which of the following perspectives from the balanced scorecard helps managers answer the question,"How do we look to shareholders?"

Operations is one factor of the internal business perspective of the Balanced Scorecard.

Sarasota Corporation has operating income of $72,000,a profit margin of 12%,and asset turnover of 3.0.The return on investment (ROI) for Sarasota Corporation would be closest to

Which of the following financial performance measures can be used to compare potential projects of different sizes?