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Question 1 What does the term decentralization mean? Question 2 Distinguish between a cost center, a revenue center, a profit center, and an investment center.
Question 1 What does the term decentralization mean? Question 2 Distinguish between a cost center, a revenue center, a profit center, and an investment center. Question 3 Here is some data concerning two divisions of the company Brasserie Nord de l'Ontario: Division Sudbury North Bay Turnover 4 000 000 $ 7 000 000 $ Average operating assets 2 000 000 2 000 000 Net profit 360 000 420 000 Work to do: 1. Calculate the ROI rate for each division. 2. Calculate the RNR for each division assuming the required rate of return is 15%. 3. Based on the results obtained, which division seems to perform the best? Question 4 Here is some data regarding an Alaskan corporation's Ketchican investment center Minimum required rate of return 15% Average operating assets 100 000 $ Net profit 20 000 Work to do: 1. Calculate the ROI rate for the Ketchican Investment Center. 2. Also calculate the RNR wires. The manager of the Ketchican division is considering acquiring a computerized diagnostic device to facilitate the maintenance of marine diesel engines. The device costs $ 25,000 and is expected to generate an additional operating profit of $ 4,500 per year. 3. Calculate the ROI rate and the NRR for the new project. 4. If the manager of the Ketchican division was assessed against the RNR, should he accept this investment? 5. If the manager of the Ketchican division was evaluated by ROI, should he accept this investment
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