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17 Cards in this Set
- Front
- Back
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Balanced Scorecard
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a set of performance measures constructed for for dimensions of performance (Financial Perspecitve, Customer Perspective, Internal Process Perspective, Learning and Growth)
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Cost Center
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a subunit that has responsibility for controlling costs but does not have responsibility for generating revenue
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Decentralized Organizations
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firms that grant substantial decision-making authority to the managers of sub-units
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Economic Value Added
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a performance measure developed by the consulting firm Stern Stewart. EVA is simply residual income adjusted for accounting distortions that arise from following GAAP
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Investment Center
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a subunit that is responsible for generating revenue, controlling costs, and investing in assets
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Investment Turnover
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the ratio of sales to invested capital
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Lack of Goal Congruences
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when managers of subunits pursuing personal goals that are incompatible with the goals of the company as a whole
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Noninterest-bearing Current Liabilities
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current liablilities that do not require interest payments
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Net Operating Profit after Taxes
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investment center income
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Profit Center
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a subunit that has responsibility for generating revenue as well as for controlling costs
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Profit Margin
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the ratio of income to sales
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Relative Performance Evaluation
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evaluating the profitability of each profit center relative to the profitibility of other, similar profit centers
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Residual Income
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the net operating profit after taxes of an investment center in excess of its required profit
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Responsibility Centers
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organizational units responsible for the generation of revenue and/or the incurrence of costs.
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Return on Investment
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the ratio of investment center income to invested capital
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Strategy Map
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a diagram of the relationships across the four dimensions of a balanced scorecard
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Transfer Price
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the price that is used to value internal transfers of goods or services
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