Management and Organizational Studies 3199Y Lecture 11: Solutions+-+Chapter+11

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 3199Y
• Professor: hawn

Document Summary

Present new line total (1) sales ,000,000 ,000,000 (2) operating income ,680,000 (3) operating assets ,250,000 ,000,000. 3. 00 (5) turnover (1) (3) (6) roi (4) (5) Thus, adding the new line would in- crease the company"s overall roi. Actual operating income ,680,000 $ 630,000 ,310,000. Residual income $ 892,500 $ 180,000 ,072,500 b. Under the residual income approach, stefan grenier would be inclined to accept the new product line, since adding the product line would increase the total amount of his division"s residual income, as shown above. Case 11-24: answers may differ concerning which category learning and growth, internal business processes, customers, or financial a particular per- formance measure belongs to. Written-off accounts receivable as a percentage of sales. Customer satisfaction with ac- curacy of charge ac- count bills. Percentage of sales clerks trained to correctly enter data on charge account slips. Unsold inventory at end of season as a percentage of total cost of sales.