Question

Assume you are the Chief Operating Officer (COO) for a publicly-traded company that has three separate...

Assume you are the Chief Operating Officer (COO) for a publicly-traded company that has three separate divisions. Each division produces and markets a separate line of products. The products do not compete with each other, and each division operates in a relatively autonomous environment. Accordingly, each division is deemed to be an investment center. The company’s CEO has charged you with designing a uniform evaluation system that will be used to evaluate each of the division managers. Prepare an executive summary that describes and defends the plan you propose. If you use multiple criteria, you should indicate the weight to be given each one, and why you believe each one is an appropriate measure.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

As a COO of company I will measure performance of each investment division and their managers on basis of following criteria.

1. Net present value(NPV)- it is difference between present value of cash outflows and present value of cash inflows over a period of time.

2. Internal rate of return(IRR)-it is the rate at which net present value of all cash flows equal to zero

3.profitability ratio-it measures overall profitability of company considering all cost of company.it includes return of asset ratio, gross profit ratio, net proft ratio,return on capital employed ratio.

There are various factor to measure performance of centre and manager but most weight should be given to net present value.it is more realistic then any other.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Red Line Railroad Inc. has three regional divisions organized as profit centers. The chief executive officer...
Red Line Railroad Inc. has three regional divisions organized as profit centers. The chief executive officer (CEO) evaluates divisional performance, using income from operations as a percent of revenues. The following quarterly income and expense accounts were provided from the trial balance as of December 31: Revenues—East $ 884,000 Revenues—West 1,050,000 Revenues—Central 1,870,000 Operating Expenses—East 568,100 Operating Expenses—West 623,520 Operating Expenses—Central 1,170,540 Corporate Expenses—Shareholder Relations 157,000 Corporate Expenses—Customer Support 407,000 Corporate Expenses—Legal 261,000 General Corporate Officers’ Salaries 270,750 The company...
In this assignment you will analyze the performance of actual company divisions. FASB ASC 280 (formerly...
In this assignment you will analyze the performance of actual company divisions. FASB ASC 280 (formerly SFAS 131) requires publicly traded companies to disclose segment information in the notes to the financial statements. You will use Excel to create visually appealing data tables and bar charts to analyze division performance, and then comment on the results.    Due Date: Tuesday, May 1, 2018.   Submit as an attachment in Blackboard in the Module 24 Assignment. SECTION I The link is to...
Profit Center Responsibility Reporting A-One Freight Inc. has three regional divisions organized as profit centers. The...
Profit Center Responsibility Reporting A-One Freight Inc. has three regional divisions organized as profit centers. The chief executive officer (CEO) evaluates divisional performance using operating income as a percent of revenues. The following quarterly income and expense accounts were provided from the trial balance as of December 31, 20Y3. Revenues—Air Division $ 919,700 Revenues—Rail Division 1,078,900 Revenues—Truck Division 1,935,200 Operating Expenses—Air Division 582,800 Operating Expenses—Rail Division 642,100 Operating Expenses—Truck Division 1,170,300 Corporate Expenses—Shareholder Relations 139,900 Corporate Expenses—Customer Support 515,000 Corporate...
BACKGROUND INFORMATION: Frosty Co. is a publicly traded, medium-sized manufacturing firm that produces refrigerators, freezers, ice...
BACKGROUND INFORMATION: Frosty Co. is a publicly traded, medium-sized manufacturing firm that produces refrigerators, freezers, ice makers, and snow cone machines. During the past three years, the company has struggled against increasing competition, sluggish sales, and a public relations scandal surrounding the departure of the former Chief Executive Officer (CEO) and Chief Financial Officer (CFO). The new CEO, Jane Mileton, and CFO, Doug Steindart, have worked hard to improve the company's image and financial position. After several difficult years, the...
Discuss ethical issues that can be identified in this case and the mode of managing ethics...
Discuss ethical issues that can be identified in this case and the mode of managing ethics Enron finds itself in this case. How would you describe the ethical culture and levels of trust at Enron? Provide reasons for your assessment. THE FALL OF ENRON: A STAKEHOLDER FAILURE Once upon a time, there was a gleaming headquarters office tower in Houston, with a giant tilted "£"' in front, slowly revolving in the Texas sun. The Enron Corporation, which once ranked among...
What role could the governance of ethics have played if it had been in existence in...
What role could the governance of ethics have played if it had been in existence in the organization? Assess the leadership of Enron from an ethical perspective. THE FALL OF ENRON: A STAKEHOLDER FAILURE Once upon a time, there was a gleaming headquarters office tower in Houston, with a giant tilted "£"' in front, slowly revolving in the Texas sun. The Enron Corporation, which once ranked among the top Fortune 500 companies, collapsed in 2001 under a mountain of debt...
Discuss how the respective organizations’ relations with stakeholders could have potentially been affected by the events...
Discuss how the respective organizations’ relations with stakeholders could have potentially been affected by the events that took place at Enron and how the situation could have been dealt with differently to prevent further damage? THE FALL OF ENRON: A STAKEHOLDER FAILURE Once upon a time, there was a gleaming headquarters office tower in Houston, with a giant tilted "£"' in front, slowly revolving in the Texas sun. The Enron Corporation, which once ranked among the top Fortune 500 companies,...
Sign In INNOVATION Deep Change: How Operational Innovation Can Transform Your Company by Michael Hammer From...
Sign In INNOVATION Deep Change: How Operational Innovation Can Transform Your Company by Michael Hammer From the April 2004 Issue Save Share 8.95 In 1991, Progressive Insurance, an automobile insurer based in Mayfield Village, Ohio, had approximately $1.3 billion in sales. By 2002, that figure had grown to $9.5 billion. What fashionable strategies did Progressive employ to achieve sevenfold growth in just over a decade? Was it positioned in a high-growth industry? Hardly. Auto insurance is a mature, 100-year-old industry...
Delta airlines case study Global strategy. Describe the current global strategy and provide evidence about how...
Delta airlines case study Global strategy. Describe the current global strategy and provide evidence about how the firms resources incompetencies support the given pressures regarding costs and local responsiveness. Describe entry modes have they usually used, and whether they are appropriate for the given strategy. Any key issues in their global strategy? casestudy: Atlanta, June 17, 2014. Sea of Delta employees and their families swarmed between food trucks, amusement park booths, and entertainment venues that were scattered throughout what would...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT