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In: Accounting

List 2 KPI’s that could assist a small business owner in their planning and management decisions....

List 2 KPI’s that could assist a small business owner in their planning and management decisions. For each KPI, clearly state what they are measuring and how it may assist a small business owner monitor their small business.

KPI 1:

KPI 2:

Solutions

Expert Solution

Answer - The KPI s are as Follows

1. Revenue Vs. Target: This is the comparison between your actual revenue and your projected revenue. Analyzing the discrepancies between these two numbers will help the Business owner identify how department is performing ie it will help which line of Business is Performing Better Or Worse.

2. Day Sales Outstanding (DSO): DSO is Calculated by Dividing the Accounts recievable by the Credit sales and Multiplying the Result by the Number of days. The lower the number, the better your organization is doing at collecting accounts receivable. Business Owner can  run this formula every month, quarter, or year to see how the Business is improving.

3. Number Of Customers: This performance indicator is fairly straightforward. By determining the number of customers Business Owner has gained and lost, he can further understand whether or not Business is meeting the customers’ needs.

ekkarill92 answered 1 year ago
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