Question

1. AnaCarolina and Jaco, accountants for Duke Manufacturing, are tasked with determining appropriate performance metrics for the financial perspective of Duke's balanced scorecard. Which of the following is the best metric for this situation?

a.operating throughout

b.material price variance

2. The triple bottom line approach to sustainability includes all of the following reporting categories except _____ performance.

a.social

b.financial

c.international

d.environmental

c.return on investment

d.customer satisfaction rating

3. To minimize common measures bias when developing divisional balanced scorecards for unique divisions within a corporation,

a.each division must focus equally on all four perspectives of the balanced scorecard

b.one division may focus more heavily on a subset of the four perspectives, for example on learning and growth and internal processes, while other divisions focus on different perspectives, such as customer and financial

c.it is important to stop gathering information when the results for the division look good

d.the performance metrics should be treated as strategic objectives in and of themselves within each division

Answer 1

Solution 1) c - Return on investment

A balanced scorecard facilitates an entity to improve upon its functions and performance by measuring and analysing four elements namely: 1) Finance 2) Customers 3) Innovation & Growth 4) Internal process

Financial perspective of balanced scorecard lays emphasis on the financial performance of the entity thereby facilitating the entity to analyse as to how it would appear to the shareholders.

Thus return on investment is considered to be the appropriate performance metrics for the financial perspective of Duke's Balanced Scorecard.

Solution 2) c - International performance

The triple bottom line approach to sustainability measures social, financial and environmental performance.

Solution 3) a -

In order to develop divisional balanced score cards for unique divisions within a corporation, each division must focus equally on all four perspectives of balanced scorecard.