Divisional Performance Measurement
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(Difference between revisions)
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For Example | For Example | ||
{| | {| | ||
| − | + | Sales|900 | |
| − | |-less VC|400 | + | |- |
| − | |-CONTRIBUTION+|500|''(note:no good for management performance measurement because Mgr can control FC)'' | + | less VC|400 |
| − | |-less controllable FC|100 | + | |- |
| − | |-CONTROLLABLE PROFIT|400|''(Good for Mgr performance measurement unless it's a profit center they have no control over depreciation)'' | + | CONTRIBUTION+|500|''(note:no good for management performance measurement because Mgr can control FC)'' |
| − | |-less Non-controllable FC|100 | + | |- |
| − | |-DIV PROFIT Before Corp Exp's|300|''(Good measure of Division's economic performance)'' | + | less controllable FC|100 |
| − | |-Corp Exp|100|''(Arbitrary allocation)'' | + | |- |
| − | |-DIV NET PROFIT|200|''(Good measure of comparison with peer companies)'' | + | CONTROLLABLE PROFIT|400|''(Good for Mgr performance measurement unless it's a profit center they have no control over depreciation)'' |
| + | |- | ||
| + | less Non-controllable FC|100 | ||
| + | |- | ||
| + | DIV PROFIT Before Corp Exp's|300|''(Good measure of Division's economic performance)'' | ||
| + | |- | ||
| + | Corp Exp|100|''(Arbitrary allocation)'' | ||
| + | |- | ||
| + | DIV NET PROFIT|200|''(Good measure of comparison with peer companies)'' | ||
|} | |} | ||
Revision as of 10:12, 9 February 2011
A Divisional perfoamnce measurement could look like this:
For Example
See Divisionalization See Residual Income
