Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Return on Investment and Residual Income
This is a traditional approach to performance measurement given by:
ROI = Income Invested Capital (method) of Liability analysisROI can provide more insight to performance when it is divided into the Dupont components. The Dupont method states that:ROI = Capital turnover X profit margin = (Revenue / Invested capital) X (Income / Revenue)Dupont method leads to the generalization that ROI can be increased by any action that:
• Decreases costs• Increases revenue• Decreases invested capitalReturn on investment highlights the benefits that managers can obtain by decreasing investment in both current and fixed assets. Investment in cash, inventory, accounts receivable and fixed assets should be minimized for any level of effective performance. This requires that idle cash is invested, proper inventory levels are kept, credit is managed judiciously and fixed assets are invested in carefully.
However, return on investment may induce managers of a highly profitable division to reject projects, which from the view point of the organization as a whole should be accepted. ROI encourages managers to make decisions which may increase short-term profit without considering their effect on the future of the company.
What Procedure are followed in kaizen costing In brief kaizen costing involves setting a new cost reduction target every month. The difference between the target profits and th
Disadvantages of activity based costing 1) It is essentially not the panacea for all ills. 2) It absorbs a lot of resources. 3) Too much emphasis on customer viability c
critically examine the current cost accounting for price level changes
Consortium Lending: As the financial needs of a single unit are more than a single bank can cater to, then more than one bank comes together to finance the unit jointly spreading
The Nature of Accounting Accounting is process of recording, analyzing, summarizing, and interpreting financial (money-related) activities to allow individuals as well as org
Ross White's machine shop uses 2,500 brackets during the course of a year, and this usage is relatively constant by the year. These brackets are purchased from a supplier 100 miles
MATERIAL CONTROL It is said that "any fool can sell"—it is buying at the right price that is more critical to the achievement of a satisfactory return on capital employed. Buy
Explain TWO limitations of using accounting ratios to assess the performance of a firm and suggest how each limitation may be improved
Transfer Pricing Methods Transfer pricing methods are concerned with the alternative means by which a transfer price can be set and its impact on organizations gauged. Emmanuel
Characteristics of cost reduction 1) Cost reduction must be real : said through increase in productivity change in product design improvement in technology etc. 2) Cost r
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd