AFM341 Study Guide - Final Guide: Balanced Scorecard, Strategy Map, Strategic Management

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lemonbeetle804

16 Dec 2018

School

University of Waterloo

Department

Accounting & Financial Management

Course

AFM341

Professor

Adeel Mahmood

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Document Summary

Balanced scorecard: improvements in the process perspective leads to improvements in the learning & Chapter 14 t or f: the balanced scorecard only includes quantitative measures. Answer: false: the balanced scorecard framework describes performance from four different perspectives based on the firm"s strategy to achieve shareholder value. In the business process perspective, the firm describes its objectives for impr ovements in tangible and intangible infrastructure. Answer: false: a strategy map depicts the cause and effect relationship between objectives across the balanced scorecard perspectives. Answer: true: when the firm"s value proposition meets or exceeds customers" requirements, customer satisfaction results in customer retention and new customer acquisition, which drives sales growth. Answer: true: besides presenting financial performance information to shareholders, the financial perspective provides information that can confirm the success of investments in learning and growth. Answer: true: network it changes the way that work is performed and decisions are made.

Related Questions

16. Which of the following is an advantage of standard costs?

a. Contribution to management control.

b. Promotion of greater economy and efficiency.

c. Simplification of the costing of inventories and reduction of clerical costs.

d. All of the above.

17. Which of the following is an objective of the customer perspective of a balanced scorecard?

a. Credit rating

b. Brand recognition

c. Percentage of defect-free products
d. Ethics violations

The objective of reducing waste refers to which perspective of a Balanced Scorecard?

a. Financial

b. Customer

c. Internal Process
d. Learning and Growth

coralmink309

Haglund Department Store is located in the downtown area of asmall city. While the store had been profitable for many years, itis facing increasing competition from large national chains thathave set up stores on the outskirts of the city. Recently thedowntown area has been undergoing revitalization, and the owners ofHaglund Department Store are somewhat optimistic that profitabilitycan be restored. In an attempt to accelerate the return ofprofitability, management of Haglund Department Store is in theprocess of designing a balanced scorecard for the company.Management believes the company should focus on two key problems.First, customers are taking longer and longer to pay the bills theyincur using the department storeâs charge card, and the company hasfar more bad debts than are normal for the industry. If thisproblem were solved, the company would have more cash to make muchneeded renovations. Investigations has revealed that much of theproblem with late payments and unpaid bills results from customersdisputing incorrect charges on their bills. These incorrect chargesusually occur because salesclerks incorrectly enter data on thecharge account slip. Second, the company has been incurring largelosses on unsold seasonal apparel. Such items are ordinarily resoldat a loss to discount stores that specialize in such distressitems. The meeting in which the balanced scorecard approach wasdiscussed was disorganized and ineffectively led-possibly becauseno one other than one of the vice presidents had read anythingabout how to build a balanced scorecard. Nevertheless, a number ofpotential performance measures were suggested by various managers.These potential performance measures are: a. Percentage of chargeaccount bills containing errors. b. Percentage of salesclerkstrained to correctly enter data on charge account slips. c. Averageage of accounts receivable. d. Profit per employee. e. Customersatisfaction with accuracy of charge account bills from monthlycustomer survey. f. Total sales revenue. g. Sales per employee. h.Travel expenses for buyers for trips to fashion shows. i. Unsoldinventory at the end of the season as a percentage of total cost ofsales. j. Courtesy shown by junior staff members to senior staffmembers based on surveys of senior staff. k. Percentage ofsuppliers making just-in-time deliveries. l. Sales per square footof floor space. m. Written -off accounts receivable (bad debts) asa percentage of sales. n. Quality of food in the staff cafeteriabased on staff surveys. o. Percentage of employees who haveattended the cityâs cultural-diversity workshop. p. Total profit.1. As someone with more knowledge of the balanced scorecard thanalmost anyone else in the company, you have been asked to build anintegreated blanced scorecard. In your scorecard, use onlyperformance measures listed previously. You do not have to use allof the performance measures suggested by the managers, but youshould build a balanced scorecard that reveals a strategy fordealing with the problems with accounts receivable and with unsoldmerchandise. Construct the balanced scorecard folliwng the formatused in Exhibit 12-5. Do not be concerned with whether a specificperformance measure falls within the learning and growth, internalbusiness process, customer, or financial perspective. However, usearrows to show the casual links between performance measures withinyour balanced scorecard and explain whether the perfroamcnemeasures should show increases or decreases. 2. Assume that thecompany adopst your balanced scorecard. After operating for a year,some performance measures show improvements, but not others. Whatshould management do next? 3. A. suppose that customers expressgreater satisfaction with the accuracy fo their charge accountbills but the performance measures for the average age of accoutnsreceivable and for bad debts do not improve. Explain why this mayhappen. b.

ochrewolf963

Please help me answer the following questions:
1. Management accounting:
A) is both retrospective, providing feedback about past operations,and also prospective, incorporating forecasts and estimates aboutfuture events.
B) is primarily oriented to external stakeholders.
C) must be consistent with rules formulated by the FinancialAccounting Standards Board (FASB).
D) provides information that is generally available only on aquarterly or annual basis.

2. Management accounting information is BEST described as:
A) providing a signal that something is wrong.
B) identifying and helping to explain what is wrong.
C) simply summarizing information, but giving no indication thatanything is wrong.
D) measuring overall organizational performance.

3. Which of the following would be MOST helpful for a top managerof a company?
A) profitability report of the company
B) information to monitor hourly and daily operations
C) number of customer complaints
D) operating expense summary reported by department

4. The Balanced Scorecard is said to be "balanced" because itmeasures:
A) short-term and long-term objectives.
B) financial and nonfinancial objectives.
C) internal and external objectives.
D) All of the above are correct.

5. The ________ perspective of the Balanced Scorecard asks, "How issuccess measured by our shareholders?"
A) learning and growth
B) customer
C) financial
D) shareholder

6. Defect rates for products and yield percentages in manufacturingare measures of quality included in the ________ perspective of theBalanced Scorecard.
A) financial
B) production
C) process
D) internal

7. The purpose of the Balanced Scorecard is BEST described ashelping an organization:
A) develop customer relations.
B) mobilize employee skills for continuous improvements inprocessing capabilities, quality, and response times.
C) introduce innovative products and services desired by targetcustomers.
D) translate an organization's mission, vision, and strategy into aset of performance measures that help to implement thestrategy.

8. The FIRST step in developing strategic objectives for theBalanced Scorecard is:
A) defining the long-run financial objectives.
B) identifying the target customer.
C) articulating the organization's vision.
D) select objectives for the customer value proposition.

9. Identify the BEST description of the Balanced Scorecard'scustomer perspective. To achieve our firm's vision andstrategy:
A) How do we lower costs?
B) How do we motivate employees?
C) How can we obtain greater profits?
D) How does the company intend to attract, retain, and deepenrelationships with targeted customers by differentiating itselffrom competitors?

10. Fixed costs:
A) may be either direct or indirect costs.
B) vary with production or sales volume.
C) include parts and materials used to manufacture a product.
D) can be adjusted in the short run to meet actual demands.

11. Which of the following describes a variable cost?
A) Variable cost are always indirect costs.
B) Variable costs increase in total when the actual level ofactivity increases.
C) Variable costs include most personnel costs and depreciation onmachinery.
D) Variable costs can always be traced directly to the costobject.

12. Cost-volume-profit analysis is used PRIMARILY bymanagement:
A) as a planning tool.
B) for control purposes.
C) to establish a target net income for next year.
D) to attain extremely accurate financial results.

13. The break-even point is the level at which revenues:
A) equal fixed costs.
B) equal variable costs.
C) equal fixed costs minus flexible costs.
D) equal variable costs plus fixed costs.

14. Cost-volume-profit analysis assumes all of the followingEXCEPT:
A) all costs are purely variable or fixed.
B) units manufactured equal units sold.
C) total variable costs remain the same over the relevantrange.
D) total fixed costs remain the same over the relevant range.

AFM341 Study Guide - Final Guide: Balanced Scorecard, Strategy Map, Strategic Management

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