Management AccoUnting - TUgas Mandiri 02 – ROI, RI & Balanced

scorecard

Nama : Rut Miranda Lumbantobing Nilai :

NIM : 2019104817

TUgas dikUmpUlkan hari Selasa, 27 April 2020 !!!

I. Pilih Jawaban yang paling tepat! Dan lengkapi jawaban kalian dengan
rumus dan cara pengerjaannya!

1. The top management at Amore Corp, a manufacturer of computer games, is attempting to

recover from a flood that destroyed some of their accounting records. The main computer
system was also severely damaged. The following information was salvaged:

Alpha Division Beta Division Gamma Division

Sales $7,000,000 (a) $2,500,000
Net operating income $5,500,000 $1,100,000 $ 1,200,000
Operating assets (b) (c) $1,600,000
Return on investment 0.26 .15 (d)
Return on sales (e) .1 0.5
Investment turnover (f) (g) 1.5

What is the value of the operating assets belonging to the Alpha Division (b)?
A) $12,500,000
B) $21,153,846
* Net Operating Income: $5.500.000 / 0.26 Total Value of the Operating Assets: $ 21.153.846
C) $26,923,077
D) $1,820,000

2. Bouvous Corp has two regional offices. The data for each are as follows:

Maryland New Jersey

Revenues $293,000 $298,000
Operating assets 2,900,000 4,700,000
Net operating income1,200,000 1,200,000

What is the return on investment for the New Jersey Division?

A) 6.3%
B) 25.5%
C) 41.4%
D) 19.2%

*Return on Investment: $ 1.200.000 / $ 4.700.000 Book Value Current Value Book Value Current
Value Bleach $325.000 $300.000 $130.000 $175.000 Cleanser $415.000 $365.000 $120.000

December 8, 2020 1
 Management AccoUnting - TUgas Mandiri 02 – ROI, RI & Balanced
scorecard

$130.000 Total Return on Investment: 0,2553 x 100% = 25,53% (Pembulatan 25,5%

December 8, 2020 2
3. The Cybertronics Corporation reported the following information for its Cyclotron Division:

Revenues $2,300,000
Operating costs 1,700,000
Operating assets 1,100,000

Income is defined as operating income.

What is the Cyclotron Division's return on investment?
A) 35.3%
B) 70.6%
C) 27.3%
D) 54.5%
* Income Return on Investment Cyclotron: $ 600.000 ($ 2.300.000 - $ 1.700.000) / $
1.100.000 = 0.5454 Total Income Return on Investment Cyclotron: 0.5454 x 100% = 54,54%
(Pembulatan 54,5%)

4. Zenith Corporation's net income is $80,000. What is the return on investment if the
amount of the investment is $510,000?
A) 18.60%
B) 13.56%
C) 15.69%
D) 27.12%
* Amount of Investment Zenith: $ 80.000 / $510.000 = 0.15686 Total Amount of Investment:
0.15686 x 100% = 15.686% (Pembulatan 15,69%)

5. Care Inc., has two divisions that operate independently of one another. The financial data
for the year 2015 reported the following results:

North South
Sales $6,000,000 $5,000,000
Operating income 1,900,000 1,600,000
Taxable income 1,600,000 750,000
Investment 16,000,000 10,000,000

The company's desired rate of return is 10%. Income is defined as operating income.
What are the respective return-on-investment ratios for the North and South Divisions?
A) 16.00% and 11.88%
B) 10.00% and 7.50%
C) 11.88% and 16.00%
D) 7.50% and 10.00%
* North Divisions of Care Inc: $ 1.900.000 / $ 16.000.000 = 0.11875 x 100 = 11.875
(Pembulatan 11.88%)
South Divisions of Care Inc: $ 1.600.000 / $ 10.000.000 = 0.16 x 100 = 16%
Join North and South Divisions: 11.88% and 16%

6. Care Inc., has two divisions that operate independently of one another. The financial data
for the year 2015 reported the following results:

North South
Sales $6,000,000 $5,000,000
 Operating income 1,900,000 1,800,000
Taxable income 1,500,000 800,000
Investment 14,000,000 11,000,000

The company's desired rate of return is 10%. Income is defined as operating income.
What are the respective residual incomes for the North and South Divisions?
A) $60,000 and $100,000
B) $300,000 and $60,000
C) $300,000 and $100,000
D) $500,000 and $700,000

* North Divisions of Care Inc: $ 1.900.000 – (0.1 x $ 14.000.000) (0.1 > 10/100) =
$500.000
South Divisions of Care Inc: $ 1.800.000 – (0.1 x $ 11.000.000) = $ 700.000
Total Amount in North and South Divisions is $ 500.000 and $ 700.000

7. Care Inc., has two divisions that operate independently of one another. The financial data
for the year 2015 reported the following results:

North South
Sales $6,000,000 $5,000,000
Operating income 1,700,000 1,300,000
Taxable income 1,700,000 775,000
Investment 15,000,000 11,000,000

The company's desired rate of return is 10%. Income is defined as operating income.
Which division has the best return on investment and which division has the best residual
income figure, respectively?
A) North, North
B) South, South
C) North, South
D) South, North

8. The top management at Groundsource Company, a manufacturer of lawn and garden

equipment, is attempting to recover from a fire that destroyed some of their accounting
records. The main computer system was also severely damaged. The following information
was salvaged:

Tractor Division Tiller Division Digger Division

Sales $10,000,000 (a) $2,400,000
Net operating income $ 1,000,000 $1,440,000 $ 600,000
Operating assets (b) (c) $ 2,000,000
Return on investment .2 0.11 (d)
Return on sales (e) 0.14 0.25
Investment turnover (f) (g) 1.2

What is the Tiller Division's investment turnover?

 A) 1.27
B) 0.79
C) 0.02
D) 0.25
* Investment Turnover: Return on Investment / Return on Sales Investment Turnover: 0.11 /
0.14 = 0.79

9. Which of the following statements best relates to the balanced scorecard's financial
perspective?
A) How can we maximize profits for the current year?
B) How can we increase shareholder value?
C) How will we achieve continuous improvements?
D) How can we maximize customer satisfaction?

10. Which of the following focuses on these five factors: competitors, potential entrants to
the market, equivalent products, bargaining power of customers, and bargaining power of
suppliers?
A) balanced scorecard
B) product differentiation analysis
C) industry analysis
D) business process reengineering

11. Which of the following statements best define strategy?

A) It describes how an organization can create value for its customers while
differentiating itself from its competitors.
B) It is an organization's ability to achieve lower costs relative to competitors through
productivity and efficiency improvements, elimination of waste, and tight cost control.
C) It is an organization's ability to offer products or services its customers perceive to be
superior and unique relative to the products or services of its competitors.
D) It describes how an organization motivates its employees to work for more hours
without any increase in their wages.

12. What is the term for an organization's ability to achieve lower costs relative to
competitors through productivity and efficiency improvements, elimination of waste, and
tight cost control?
A) Marketing strategy
B) Product differentiation
C) Cost leadership
D) Competitor differentiation

13. Canarsie Corporation uses a balanced scorecard to evaluate its digital camera
manufacturing operation. Which of the following statements with respect to balanced
scorecards is/are correct?
 I. A balanced scorecard reports management information regarding organizational
performance in achieving goals classified by critical success factors to demonstrate that
no single dimension of organizational performance can be relied upon to evaluate success.
II. Performance measures used in a balanced scorecard tend to be divided into financial,
customer, internal business process, and learning and growth.
III. In a balanced scorecard, internal business processes are what the company does
in its attempts to satisfy customers.
1. I and II only are correct.
2. II and III only are correct.
3. III only is correct.
4. I, II, and III are correct
 Choice 2 are correct, because the balanced scorecard divides performance
measures into financial, customer, internal business process and learning and
growth (item II) and internal business process are what the company does in
its attempt to satisfy customers (item III). It’s not a comprehensive
management information system as described in item I.

14. The balanced scorecard describes all of the following except which one?
A) The descriptions of critical initiatives for the organization’s performance.
B) The strategic goals.
C) The related measures associated with strategic and tactical goals.
D) The definition of strategic business

15. Which of the following could be a measure of the balanced scorecard's financial
perspective?
A) Service response time
B) Number of new patents
C) Operating income
D) Defect rates

16. The first step to successful balanced scorecard implementation is clarifying the
.
A) organization's vision and strategy
B) elements that pertain to value-added aspects of the business
C) owner's expectations about return on investment
D) objectives of all four balanced scorecard measurement perspectives

17. Home Decor Inc., manufactures home cleaning products. The company has two divisions,
Bleach and Cleanser. Because of different accounting methods and inflation rates, the
company is considering multiple evaluation measures. The following information is provided
for 2018:

ASSETS INCOME
 Book Value Current value Book value Current value
Bleach $325,000 $300,000 $130,000 $175,000
Cleanser $415,000 $365,000 $120,000 $130,000
 The company is currently using a 15% required rate of return.

What are Bleach's and Cleanser's return on investment based on book values, respectively?
A) 29%; 40 %
B) 58%; 36 %
C) 36%; 58%
D) 40%; 29%
* Book value Home Decor Inc., (Book value income / Book value assets): ROI Bleanch’s: $
130.000 / $ 325.000 = 0.4 x 100 = 40% ROI Cleanser’s: $ 120.000 / $ 415.000 = 0.2891 x
100 = 28,91% (Pembulatan 29%) The Answer of ROI Bleanch’s and Cleanser’s is 40% and
29%

18. Which of the following is true of rewarding managers on the basis of residual income?
A) Managers are paid a fixed amount for his services regardless of the risk involved.
B) Managers' efforts are easily measured.
C) Managers taking less risk should be rewarded more since more risk can lead to huge
losses.
D) Managers' rewards are dependent on their own efforts and other local economic
factors.

19. Which of the following statements is true of successfully implementing a balanced

scorecard?
A) External auditors should design and implement the balanced scorecard.
B) Balanced scorecard should never be communicated to all employees.
C) Balanced scorecard should be formed exclusively by top management.
D) Management accountants should determine the balanced scorecard measures

20. Which of the following is true of benchmarking two managers against each other if they
carry out similar operations?
A) It would lead to better cooperation among the managers.
B) It would reduce the managers' incentives to help one another.
C) It would enhance the accomplishment of organization goals.
D) It would help reduce costs common to both the departments.