Strategic management accounting and the Balanced Score Card Sales per employee Travel expenses for buyers for trips to fashion shows Average age of accounts receivables Courtesy shown by junior staff members to senior staff members based on surveys of senior staff - Unsold inventory at the end of the season as a percentage of total cost of sales 0 Sales per square foot of oor space Percentage of suppliers making just-in-time deliveries Quality of food in the staff cafeteria based on staff surveys Written-off accounts receivables (bad debts} as a percentage of sales Percentage of charge account bills containing errors Percentage of employees who have attended the city's cultural diversity workshop Total prot 0 Profit per employee. REQUIRED 1 As someone with more knowledge of the balanced scorecard than almost anyone else in the company, you have been asked to build an integrated balanced scorecard. In your scorecard, use only performance measures suggested by the managers above. You do not have to use them all, but you should build a balanced scorecard that reveals a strategy for dealing with the problems with accounts receivable and with unsold merchandise. Construct the balanced scorecard following the format used in Exhibit 17.8. Do not be particularly concerned with whether a specic performance measure falls within the learning and growth, internal business process, customer or nancial perspective- However, clearly show the causal links between the performance measures with arrows and whether the performance measures should show increases or decreases. 2 Assume that the company adopts your balanced scorecard. After operating for a year, there are improvements in some performance measures but not in others. What should management do next? 3 (a) Suppose that customers express greater satisfaction with the accuracy of their charge account bills but the performance measures for the average age of receivables and for bad debts do not improve. Explain why this might happen. (b) Suppose that the performance measures for the average age of accounts receivable, bad debts, and unsold inventory improve, but total profits do not. Explain why this might happen. Assume in your answer that the explanation lies within the company. Ci T-Z Strategic management accounting Bernard Mason has just been appointed as Commercial Manager of the Salchester Theatre. The theatre has just completed a disappointing year with low attendances, culminating in a loss of 57,000. Details of the nancial position of Salchester Theatre are given in Table 1. The current Artistic Director had, until now, been responsible for both the commercial and creative activities of the theatre- Mason has been brought in to improve the nancial health of the theatre. His previous experience has been in the nancial function within the manufacturing industry, and more recently as a finance manager at the town's university. Bernard considers himself to be a man of culture and not just a hard, bottom-line oriented businessman. He has welcomed this challenge to improve the fortunes of Salchester Theatre. Salchester is situated about 50 miles from