of decentrali tralization? an adavston making by delegation of authority. Decent
ID: 2485396 • Letter: O
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of decentrali tralization? an adavston making by delegation of authority. Decentralizaion improves the quality of decision making by delegation zation motivates managers to be more productive 1. Which of the following is NOT com ollowing is NOT considered an advantage ng is NOT considered an advantage of decentraliza Decentraliza b Decentralization guaran c. Decentralization motiva d. Decentralization trains on guarantees that lower-level managers will be e responsibility alization trains lower level managers for mor 2. A cost center in an organization revenue. incurs exp curs expenses and earns revenue. does not need managerial control. d. incurs expenses and earns no revenue Which of the following would improve a firm's return on investment? b. hould be eliminated to increase profit. 3. Which of the following would i mprvinc Raising sales prices and incurring higher expenses a. b. c. d. Increasing earnings and investment in assets. owering sales prices and increasing asset investment. L Increasing revenues, decreasing expenses, and decreasing investment in assets. 4. Last year, Thurco Corporation had revenues of $120,000 and expenses of $70,000. If Thurco had $250,000 of equipment and other operating assets last year, what was Thurco's return on investment? 10% 10% a. 15% 20% 25% b. C. d. Last year, Thurco Corporation had revenues of $120,000 and expenses of $70,000. If Thurco had $250,000 of equipment and other operating assets last year, what was Thurco's margin? a. 16.6% b. 22.2% C. 33.3% d. 41.7% 5. Last year, Thurco Corporation had revenues of $120,000 and expenses of $70,000. If Thurco had $250,000 of equipment and other operating assets last year, what was Thurco's turnover? a. .48 b. 23 C. 3.59 d. 2.08 6. 2.08 Which of the following statements about ROl is true? a. 7. Using ROI avoids conflicts of interest between a department and the business as a whole. b. ROI cannot be used to measure performance for investment centers. c. ROI can be calculated by multiplying margin by turnover d. ROl is equal to net income divided by sales. The management strategy that focuses on significant variances is called a. decentralized management. b. management by exception. c. profit management. d. centralized management. 8.Explanation / Answer
question 1 option b is correct question 2 option d is correct Question 3 option d is correct question 4 Revenues 120000 Less expenses 70000 Net income 50000 Investment 250000 ROI = Net Income / Investment 20 option c is correct question 5 Revenues 120000 Less expenses 70000 Net income 50000 Margin = 50000 /120000 *100 41.7 option d is correct question 6 Revenues 120000 Investment 250000 Turnover ratio = 120000/250000 0.48 option a is correct question 7 option b is correct question 8 option b is correct question 9 Average operating assets 300000 Desired ROI 10% RESIDUAL Income 30000 option a is correct question 10 option b is correct question 11 option a is correct question 12 NPV = CF * ( 1 - ( 1+i)-n)/I - initial investment = 30000 * ( 1 - ( 1+0.10) -4)/0.10 = 30000 * ( 1 - 0.6830)/0.10 = 30000 * 0.3170/0.1 = 30000 * 3.17 = 95096 option c is correct question 13 -1166900 300000 300000 300000 300000 300000 9% option b is correct question 14 option b is correct question 15 option d is correct
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