Which of the following statements is true? An avoidable fixed production cost incurred before the split-off point in a joint process is relevant in a sell or process further decision. It is profitable to continue processing joint products after the split-off point if their total revenues exceed the joint costs. A balanced scorecard contains both customer and internal business process performance measures because improvements in internal business process should result in improvements in customer satisfaction. Incentive compensation for employees, such as bonuses, should be tied to balanced scorecard performance measures only if managers are confident that the performance measures are easily manipulated by those being evaluated If the balanced scorecard is correctly constructed, the performance measures should be independent of each other so that bad performance on one measure will not result in bad performance on another performance measure. If improvement in a performance measure on a balanced scorecard should lead to improvement in another performance measure but does not, then employees must work harder.

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter13: The Balanced Scorecard: Strategic-based Control
Section: Chapter Questions
Problem 23P: The following strategic objectives have been derived from a strategy that seeks to improve asset...
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Which of the following statements is true?

  1. An avoidable fixed production cost incurred before the split-off point in a joint process is relevant in a sell or process further decision.
  2. It is profitable to continue processing joint products after the split-off point if their total revenues exceed the joint costs.
  3. A balanced scorecard contains both customer and internal business process performance measures because improvements in internal business process should result in improvements in customer satisfaction.
  4. Incentive compensation for employees, such as bonuses, should be tied to balanced scorecard performance measures only if managers are confident that the performance measures are easily manipulated by those being evaluated
  5. If the balanced scorecard is correctly constructed, the performance measures should be independent of each other so that bad performance on one measure will not result in bad performance on another performance measure.
  6. If improvement in a performance measure on a balanced scorecard should lead to improvement in another performance measure but does not, then employees must work harder.
  7.  
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