Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Required: a) If the Soccer Equipment Division increased its sales by 10%, how much would MU Ltd's net profit change and what would the final

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

Required: a) If the Soccer Equipment Division increased its sales by 10%, how much would MU Ltd's net profit change and what would the final net profit figure be? Assume that all cost behaviour patterns remained constant. When calculating any ratios, round to 2 decimal places (example 22.53%) (3 marks) b) The CEO wants to design a more effective performance management system to evaluate the performance of the Division Managers beyond simply using financial measures. Provide at least two possible non-financial indicators that can be used to evaluate the performance of these managers and explain why these indicators are better than traditional financial measures. (2 marks) Note: Show all working out and clearly distinguish between your 4 responses to part a) and b) a) If the Soccer Equipment Division increased its sales by 10%, how much would MU Ltd's net profit change and what would the final net profit figure be? Assume that all cost behaviour patterns remained constant. When calculating any ratios, round to 2 decimal places (example 22.53%) (3 marks) b) The CEO wants to design a more effective performance management system to evaluate the performance of the Division Managers beyond simply using financial measures. Provide at least two possible non-financial indicators that can be used to evaluate the performance of these managers and explain why these indicators are better than traditional financial measures. (2 marks) Note: Show all working out and clearly distinguish between your h responses to part a) and b) a) If the Soccer Equipment Division increased its sales by 10%, how much would MU Ltd's net profit change and what would the final net profit figure be? Assume that all cost behaviour patterns remained constant. When calculating any ratios, round to 2 decimal places (example 22.53%) (3 marks) b) The CEO wants to design a more effective performance management system to evaluate the performance of the Division Managers beyond simply using financial measures. Provide at least two possible non-financial indicators that can be used to evaluate the performance of these managers and explain why these indicators are better than traditional financial measures. (2 marks) Note: Show all working out and clearly distinguish between your h responses to part a) and b) The Segmented Profit and Loss Statement for MU Ltd is presented below: Soccer Soccer Merchandise Equipment Total Company Division Division Sales Revenue $615,500 $519,200 $1,134,700 Less: Variable Costs $280,400 $214,000 $494,400 Contribution $335,100 $305,200 $640,300 Margin Less: Traceable $83,850 $53,950 Fixed Costs Division Segment $251,250 $251,250 Margin Less: Common Fixed Costs Net Profit $137,800 $502,500 $82,500 $420,000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Theory And Its Application

Authors: Hanson Arthur Warren, Arthur W. Hanson

1st Edition

1406753351, 978-1406753356

More Books

Students also viewed these Accounting questions