Question Three Garndafath Ltd (Garndafath) operates a chain of restaurants throughout the United Kingdom. New members of the Board of Directors have argued in favour of using a Balanced Scorecard approach for performance measurement. Therefore, the Board is in the process of developing the four perspectives used by the Balanced Scorecard to help monitor performance; the following four Key Performance Indicators (KPIs) have been suggested: Percentage of business from existing customers. Percentage of revenue from new products. 1. 2. 3. Operating profit margin 4. Quality assurance as a percentage of total cost. The following information has been extracted from the last two years' financial statements of Garndafath together with other financial data and additional analysis of revenue and costs. Revenue Cost of sales Gross profit Admin & distribution costs Operating profit Revenue: 2022 2021 'm 'm 4.05 4.20 (2.50) (2.73) 1.55 1.47 (0.44) (0.42) 1.11 1.05 Existing products 3.02 2.95 New products 1.03 1.25 Sales to existing customers 2.45 2.40 Sales to new customers 1.60 1.80 Costs: Required (a) Research & development 0.66 0.72 Customer support costs 0.12 0.10 Quality assurance 0.06 0.08 Other costs 2.10 2.25 Using the financial data provided, calculate the FOUR Key Performance Indicators (KPIs) for BOTH years for Garndafath, clearly stating the most appropriate Balanced Scorecard perspective for each KPI. Marks are awarded for your workings. Present your answers to two decimal places. (10 marks) (b) Discuss each of Garndafath's KPIs that you have calculated in part (a) above, including a brief discussion of the overall performance of the company over the two years. UMADQH-15-3 (10 marks) Continued over Page 5 of 7