Which statements about residual income is false I. an evaluation havng a positive residual income may result to the detriment of the division being evaluated but always to the best interest of the entire firm II. residual income does not consider a firm's cost of acquiring investment capital III. Residual income is a peso measure, not a percetage measure A. II only B. I only C. I and II D. II and III E. I and III
Which statements about residual income is false I. an evaluation havng a positive residual income may result to the detriment of the division being evaluated but always to the best interest of the entire firm II. residual income does not consider a firm's cost of acquiring investment capital III. Residual income is a peso measure, not a percetage measure A. II only B. I only C. I and II D. II and III E. I and III
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter10: Decentralization: Responsibility Accounting, Performance Evaluation, And Transfer Pricing
Section: Chapter Questions
Problem 20E: The key difference between residual income and EVA is that EVA a. uses the actual cost of capital...
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Which statements about residual income is false
I. an evaluation havng a positive residual income may result to the detriment of the division being evaluated but always to the best interest of the entire firm
II. residual income does not consider a firm's cost of acquiring investment capital
III. Residual income is a peso measure, not a percetage measure
A. II only
B. I only
C. I and II
D. II and III
E. I and III
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