Principles of Cost Accounting
17th Edition
ISBN: 9781305087408
Author: Edward J. Vanderbeck, Maria R. Mitchell
Publisher: Cengage Learning
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Chapter 9, Problem 20Q
To determine
Explain the reason behind a company which should bother with a balanced scorecard approach to performance measurement.
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How would non-financial performance indicators help to improve the performance of the company? Explain in detail.
Which of the following statements is true?
A balanced scorecard consists of a report showing a performance measure such as ROI or residual income for all of the divisions in a company that generate profits.
If a strategy is not working, it should become evident on the balanced scorecard when some of the predicted effects don’t occur.
In essence, a balanced scorecard lays out a theory of how the company can take concrete actions to attain its desired outcomes. The strategy should seem plausible, but it should be regarded as only a theory.
Which of the following statements about the balanced scorecard approach is false?
It requires managers to focus on financial measures more than nonfinancial measures.
It looks at performance from the following perspectives: financial, customer, internal business, and learning and growth.
It helps balance short-term operating performance with long-term strategies.
It recognizes that traditional measures of performance are often not adequate to fully assess a company’s performance.
Chapter 9 Solutions
Principles of Cost Accounting
Ch. 9 - Give at least five examples of service...Ch. 9 - Prob. 2QCh. 9 - What factors help to explain the growth of service...Ch. 9 - What type of costing system do most service...Ch. 9 - What factors would you consider in deciding...Ch. 9 - Distinguish between a direct cost and an indirect...Ch. 9 - What are the elements of a cost performance...Ch. 9 - Prob. 8QCh. 9 - Why is it important for professional labor hours...Ch. 9 - Prob. 10Q
Ch. 9 - Explain how a budgeted income statement for a...Ch. 9 - What are the two main things that an...Ch. 9 - Prob. 13QCh. 9 - Prob. 14QCh. 9 - Explain the concept of a cost/benefit decision and...Ch. 9 - Prob. 16QCh. 9 - Prob. 17QCh. 9 - Prob. 18QCh. 9 - Prob. 19QCh. 9 - Prob. 20QCh. 9 - Prob. 21QCh. 9 - Prob. 22QCh. 9 - Prob. 23QCh. 9 - Prob. 24QCh. 9 - Compute the budgeted overhead rate for the coming...Ch. 9 - Compute the profit or loss on the job in (a)...Ch. 9 - Prepare a revenue budget for the year ending...Ch. 9 - Prepare a budgeted income statement for the month...Ch. 9 - Prepare a budgeted income statement for the month...Ch. 9 - Compute the budgeted overhead rates for each of...Ch. 9 - Prob. 7ECh. 9 - Prob. 8ECh. 9 - Compute the budgeted overhead rates for each of...Ch. 9 - From the following list of performance measures,...Ch. 9 - Luxe Inc., a chain of gasoline service stations,...Ch. 9 - Basic Inc., a chain of gasoline service stations,...Ch. 9 - Categorize each of the following quality costs as...Ch. 9 - Prob. 1PCh. 9 - 1. Prepare a cost performance report. 2. Compute...Ch. 9 - 1. Prepare a revenue budget. 2. Prepare a...Ch. 9 - 1. Prepare an Overhead budget. 2. Prepare an Other...Ch. 9 - Using the information for Crable and Tesch, the...Ch. 9 - Compute the budgeted overhead rate for each of the...Ch. 9 - Compute the budgeted overhead rate for each of the...Ch. 9 - Prob. 8PCh. 9 - Prob. 9PCh. 9 - Prepare a balanced scorecard, without numbers, for...Ch. 9 - Prepare a balanced scorecard for Delhi Dairies,...Ch. 9 - Prob. 12PCh. 9 - Prob. 13PCh. 9 - Prob. 1MC
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- Is there a way to prevent managers from focusing on accounting measures as performance measures?arrow_forwardWhich of the following statements regarding the balanced scorecard is not correct? a. It seeks to address the problems associated with traditional financial measures used to assess performance. b. The notion of value chain analysis plays a major role in the drawing up of a balanced scorecard. c. It relies on the perception of the users with regard to service provided. d. It is directly derived from scientific management theories.arrow_forwardWhy does the balanced scorecard include financial performance measures as well as measures of how well internal business processes are doing?arrow_forward
- Which of the following statements is true? I. A balanced scorecard consists of a report showing a performance measure such as ROI or residual income for all of the divisions in a company that generate profits. II. If a strategy is not working, it should become evident on the balanced scorecard when some of the predicted effects don't occur. III. In essence, a balanced scorecard lays out a theory of how the company can take concrete actions to attain its desired outcomes. The strategy should seem plausible, but it should be regarded as only a theory. Multiple Choice Both statements I and III are true. All of the statements are true. None of the statements are true. Both statements II and III are true.arrow_forwardDiscuss and give reasons as to why a business would want to use non-financial performance measures in addition to financial performance measures.arrow_forwardWhich of the following is NOT an example of a metric that companies are likely to use to measure some aspect of performance? a. Operating income b. CEO salary c. Cash flows d. Average employee tenurearrow_forward
- Looking from a managerial perspective, why would a firm use a balanced scorecard in evaluating performance? What benefits would be derived from the use of this measure? Please provide at least 2 references to back up your opinion.arrow_forwardExplain and give an example as to how a manager can manipulate the return on investment figure in the short run. Why are these manipulations bad for the company in the long run? Suggest some alternative performance evaluation and compensation schemes.arrow_forwardWhich of the following is not an objective used in the balanced scorecard approach? Customer Financial Vendor Learning and growtharrow_forward
- Which of the following does not describe a management control system? A. establishes a companys strategic goals B. implements a companys strategic goals C. monitors a companys strategic goals D. a system that only measures profitabilityarrow_forwardWhich of the following statements is false? A. The four dimensions of performance that are considered in a balanced scorecard are financial, customer, internal process, and learning and growth B. A balanced scorecard will include qualitative and quantitative measures. C. Stakeholders cannot include stockholders. D. A balanced scorecard is the compatibility between personal goals and the goals of the organization.arrow_forwardComponents of the organization that are demotivating for purposes of performance management are known as ______. A. business goals B. strategic plans C. uncontrollable factors D. incentivesarrow_forward
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Elements of cost | Direct and Indirect: Material, Labor, & Expenses; Author: Educationleaves;https://www.youtube.com/watch?v=UFBaj6AHjHQ;License: Standard youtube license