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The Angel Company has several divisions. Of these three divisions (Globe, Universe and Enterprise) all are in mature industries. Data for these divisions appear below
The Angel Company has several divisions. Of these three divisions (Globe, Universe and Enterprise) all are in mature industries. Data for these divisions appear below (in millions of dollars) Sales Globe $320 Division Universe $450 Enterprise $1,200 Income 32 40 90 Investment 160 240 600 Depreciation (included in income) 20 30 80 Current assets and liabilities remain fairly constant from year to year. Angel Company requires a minimum ROI of 10 percent. Required: a. Rank the divisions in order of their contribution to the firm, using at least three different criteria. (4 marks) b. Choose the one ranking criterion that you believe to be the best and justify your choice (1 marks) c. If these divisions had been in the growth stage, would your response to part b have changed? How and why? (1 marks) d. Discuss briefly why ROI, EVA and RI could be inappropriate measures of performance. (1 marks) e. Explain how the balanced scorecard can be used to measure performance
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