Question 5

• Time: 20 minutes
• Total: 10 marks

Canadas Wonderland Inc. operates amusement parks similar to those such as Six Flags, Universal Studios, Disneyland etc. Canada Wonderlands mission is to provide high quality family entertainment that exceed guests' expectations and will create lifelong memories. To achieve this goal, Wonderland strives to provide safe, clean, friendly family environments at reasonable prices. In addition to the amusement parks, the company operates a community outreach program. Through volunteerism, it offers educational and recreational programs (e.g. after school programs for children and teenagers, employment related training for adults) and special events at its facilities.

Wonderland's president, Jerry Maguire, has asked you to lead a team of employees in developing a balanced scorecard for its parks.

Required:

For each balanced scorecard perspective identify two measures of performance that relate to Wonderland's key success factors. Include targets and an explanation of why the metric is important. What strategy is Canadas Wonderland following?

Question 6

• Time: 20 minutes
• Total: 12 marks

Marys Auto Shop Inc. allows its divisions to operate as autonomous units. Their results for the current year were as follows:

	Sport	Terrain	City
Revenues	$1,700,000	$800,000	$6,000,000
Current assets	230,000	40,000	410,000
Capital assets	870,000	660,000	1,590,000
Current liabilities	100,000	100,000	500,000
Net operating income	242,000	52,0000	612,000
After-tax income	188,500	36,500	485,400
Weighted average cost of capital	10%	10%	10%

Required:

For each division compute (to two decimal) the:

1. Return on sales in %

2. Return on investment (to two decimal) based on total assets employed in %

3. Economic value added

4. Residual income based on net operating income

Question 7

• Time: 10 minutes
• Total: 6 marks

Bobs Electronics Inc. manufactures high-tech screens for computers. In June, the two production departments had budgeted allocation bases of 8,600 machine hours in Department 1 and 5,970 direct manufacturing labour hours in Department 2. The budgeted manufacturing overheads for the month were $32,000 and $27,500, respectively. For Job 101, the actual costs incurred in the two departments were as follows:

	Department 1	Department 2
Direct materials purchased on account	$66,000	$106,500
Direct materials used	12,500	9,100
Direct manufacturing labour	32,500	32,200
Indirect manufacturing labour	6,600	5,400
Indirect materials used	4,500	2,850
Lease on equipment	9,750	2,250
Utilities	600	750

Job 101 incurred 1,100 machine hours in Department 1 and 400 manufacturing labour hours in Department 2. The company uses a budgeted departmental overhead rate for applying overhead to production.

1. What is the budgeted indirect cost allocation rate for Department 1? (2 marks)

2. What is the budgeted indirect cost allocation rate for Department 2? (2 marks)

3. What is the total cost assigned to Job 101 based on normal costing? (2 marks)