Financial And Managerial Accounting
15th Edition
ISBN: 9781337902663
Author: WARREN, Carl S.
Publisher: Cengage Learning,
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Textbook Question
Chapter 28, Problem 4CMA
A sign of the successful implementation of a balanced scorecard is the presence of cause-and-effect relationships. An example of this success for a hotel is meeting the target of:
- a. decreasing a customer’s check-in time, which causes an increase in the number of implemented employee suggestions.
- b. increasing employee training hours, which causes employee compensation to increase.
- c. increasing profit, which causes an increase in employee job satisfaction ratings.
- d. receiving more 5-star ratings from customers, which causes an increase in profit.
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The following are a number of measures associated with the Balanced Scorecard.
Required:
1. Classify each performance measure as belonging to one of the following perspectives: financial, customer, internal business process, or learning and growth.
a. Number of new customers
b. Percentage of customer complaints resolved with one contact
C. Unit product cost
d.
Cost per distribution channel
e. Suggestions per employee
f.
Warranty repair costs
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Assume service scores for the area you manage, Harrah’s Metropolis hotel housekeeping, have declined over the past year. As part of the LEAN rollout at Metropolis, you and some of your front-line employees will participate in a kaizen event focused on improving guest-room housekeeping operations. What KPIs (key performance indicators) would you propose to track to determine whether the changes implemented through the kaizen effort actually improve performance?
Silver Lining Inc. has a balanced scorecard with a strategy map that shows that delivery time and the number of erroneous shipments are expected to affect the company’s ability to satisfy the customer. Further, the strategy map for the balanced scorecard shows that the hours from ordered to delivered affects the percentage of customers who shop again, and the number of erroneous shipments affects the online customer satisfaction rating. The following information is also available:
The company’s target hours from ordered to delivered is 40.
Every hour over the ordered-to-delivered target results in a 0.5% decrease in the percentage of customers who shop again.
The company’s target number of erroneous shipments per year is no more than 65.
Every error over the erroneous shipments target results in a 0.05 point decrease in the online customer satisfaction rating and an added future financial loss of $500.
The company estimates that for every 1% decrease in the percentage of customers who…
Chapter 28 Solutions
Financial And Managerial Accounting
Ch. 28 - How does a strategic performance measurement...Ch. 28 - What is the difference between a leading indicator...Ch. 28 - Prob. 3DQCh. 28 - How are strategic objectives and strategic...Ch. 28 - What do strategy maps show, and how do they add...Ch. 28 - Prob. 6DQCh. 28 - Prob. 7DQCh. 28 - Prob. 8DQCh. 28 - Prob. 9DQCh. 28 - Prob. 10DQ
Ch. 28 - 72 Inc. has developed a balanced scorecard with...Ch. 28 - Bluetiful Inc. has the following strategic...Ch. 28 - Moses Moonrocks Inc. has developed a balanced...Ch. 28 - Prob. 4BECh. 28 - Lonnies Shipping Co. is considering switching to...Ch. 28 - Henrys Cafe is a local restaurant that is growing...Ch. 28 - American Express Company is a major financial...Ch. 28 - Eat-n-Run Inc. owns and operates 10 food trucks...Ch. 28 - Prob. 4ECh. 28 - Apples Oranges Inc. is trying to become more...Ch. 28 - The following is the balanced scorecard for Smith...Ch. 28 - Prob. 7ECh. 28 - Coulson and Company is a large retail business...Ch. 28 - Rizzo Goal Inc. produces and sells hockey...Ch. 28 - Silver Lining Inc. has a balanced scorecard with a...Ch. 28 - Two departments within Cougar Gear Inc. are...Ch. 28 - Sunny Nights Inc. is completely powered by the...Ch. 28 - Instructions 1.Label each element of the balanced...Ch. 28 - Strategic initiatives and CSR Obj. 2, 4 Get...Ch. 28 - Hyperflash Inc. has a balanced scorecard that...Ch. 28 - Instructions 1.Based on the balanced scorecard and...Ch. 28 - Strategic initiatives and CSR Blue Skies Inc. is a...Ch. 28 - Eye Swear Inc. has a balanced scorecard that...Ch. 28 - Den-Tex Company is evaluating a proposal to...Ch. 28 - Prob. 2MADCh. 28 - Analyze CSR initiatives at Green Manufacturing...Ch. 28 - Prob. 1TIFCh. 28 - Blake McKenzie Tax Services is a company serving...Ch. 28 - Young Manufacturing Company is a startup...Ch. 28 - The fundamental concept behind strategic...Ch. 28 - Which of the following statements regarding the...Ch. 28 - The balanced scorecard provides an action plan for...Ch. 28 - Which of the following statements best describes...Ch. 28 - A sign of the successful implementation of a...
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- The following if-then statements were taken from a Balanced Scorecard: a. If employee capabilities increase, then process time decreases. b. If process time decreases, then customer retention will increase. c. If customer retention increases, then market share will increase. d. If market share increases, then revenues will increase. Required: 1. Identify the lead and lag variables, and explain your reasoning. 2. Discuss the implications of Requirement 1 for the financial and learning and growth perspectives. 3. Using the first if-then statement, explain the concept of double-loop feedback.arrow_forwardConsider the following quality improvement strategy as expressed by a series of if-then statements: If real-time feedback information capabilities improve, then post-sales service time will improve. If post-sales service time improves, then post-sales service quality will increase. If post-sales service quality increases, then customer satisfaction will increase. If customer satisfaction increases, then market share will increase. If market share increases, then sales will increase. If sales increase, then profits will increase. Required: 1. Prepare a strategy map that shows the cause-and-effect relationships of the quality improvement strategy (see Exhibit 13.10 for an illustrative example). 2. Explain how the quality improvement strategy can be tested.arrow_forwardDescribing the balanced scorecard and identifying key performance indicators for each perspective Consider the following key performance indicators, and classify each according to the balanced scorecard perspective it addresses. Choose from financial perspective, customer perspective, internal business perspective, or learning and growth perspective. a. Number of employee suggestions implemented b. Revenue growth c. Number of on-time deliveries d. Percentage of sales force with access to real-time inventory levels e. Customer satisfaction ratings f. Number of defects found during manufacturing g. Number of warranty claims h. Return on investment i. Variable cost per unit j. Percentage of market share k. Number of hours of employee training l. Number of new products developed m. Yield rate (number of units produced per hour) n. Average repair time o. Employee satisfaction p. Number of repeat customersarrow_forward
- A hotel has the following organizational goal: Increase employee satisfaction. Which one of the following is the best performance measure of the organizational goal? O A. turnover rate of hotel employees O B. overall rating on employee service on guest satisfaction survey O C. percent of guests writing complaints about employees OD. number of new employees trained Click to select your answer. act Us I search 70 hparrow_forwardClassify the performance measures below into the most likely balanced scorecard perspective itrelates to. Label your answers using C (customer), P (internal process), I (innovation and growth), or F(financial). Customer wait timearrow_forwardUSA Airlines uses the following performance measures. Classify the performance measures belowinto the most likely balanced scorecard perspective it relates to. Label your answers using C (customer),P (internal process), I (innovation and growth), or F (financial). Flight attendant training sessions attendedarrow_forward
- Which of the following is a balanced scorecard performance measure. Employee learning and growth Customer satisfaction Business process improvements All of these are performance measuresarrow_forwardClassify the performance measures below into the most likely balanced scorecard perspective itrelates to. Label your answers using C (customer), P (internal process), I (innovation and growth), or F(financial). Employee sustainability training sessions attendedarrow_forwardUSA Airlines uses the following performance measures. Classify the performance measures belowinto the most likely balanced scorecard perspective it relates to. Label your answers using C (customer),P (internal process), I (innovation and growth), or F (financial). Accidents or safety incidents per mile flownarrow_forward
- Question TWO (а) The owner of a hotel wants to introduce a Balanced Scorecard (BSC). She has seen that similar hotels have already started to implement the BSC. The main concern for the hotel is employee turnover. Employee turnover is increasing and the owner believes this may be affecting the performance of the hotel. Required Prepare a short memo to the owner evaluating the potential benefits for staff of implementing a Balanced Scorecard. (b) Some management accountants believe the BSC may not actually improve financial performance? Required Evaluate the conceptual and practical limitations of the BSC. This a broad question requiring a range of issues to be raised.arrow_forwardClassify each of the following performance measures into the balanced scorecard perspective to which it relates: financial perspective, internal operations perspective, learning and growth perspective, or customer perspective. A. Number of improved products B. Time from packaging to delivery or display C. Production costs D. Number of customer suggestions E. Sales mix revenues F. Number of repeat customersarrow_forwardInstructions 1. Based on the balanced scorecard and the following descriptions of the predicted relationships between strategic objectives, draw the scorecards strategy map. a. Training employees effectively and reducing employee turnover can both be expected to improve returns processing and reduce shipping errors. b. Both improving returns processing and reducing shipping errors can be expected to delight the customer. c. Delighting the customer can be expected to increase market share. 2. Based on the balanced scorecard and the following descriptions of the predicted relationships between performance metrics, draw the scorecards measure map. a. Median training hours per employee and average employee tenure will both influence hours from returned to refunded and number of erroneous shipments. b. Both hours from returned to refunded and number of erroneous shipments will affect percentage of customers who shop again and online customer satisfaction rating. c. Both percentage of customers who shop again and online customer satisfaction rating will influence the companys market share. 3. Label each element of the balanced scorecard.arrow_forward
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