Divisional Performance Measurement: Difference between revisions
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See [[Divisionalization]] | *See [[Divisionalization]] | ||
See [[Residual Income]] | *See [[Residual Income]] | ||
[[Category:Finance]] | [[Category:Finance]] | ||
Revision as of 08:35, 9 February 2011
A Divisional performance measurement could look like this:
For Example
| Sales | 900.00 | |
| less VC | 400.00 | |
| CONTRIBUTION+ | 500.00 | No good for management performance measurement because Mgr can control FC |
| less controllable FC | 100.00 | |
| CONTROLLABLE PROFIT | 400.00 | Good for Mgr performance measurement unless it's a profit center they have no control over depreciation |
| less Non-controllable FC | 100.00 | |
| DIV PROFIT Before Corp Exp's | 300.00 | Good measure of Division's economic performance |
| Corp Exp | 100.00 | Arbitrary allocation |
| DIV NET PROFIT | 200.00 | Good measure of comparison with peer companies |
- See Divisionalization
- See Residual Income
