Management Accounting 3

During our analysis of individual segments, exhibit 2, we found that the RONAs for the Retailing and Food were lagging behind that of the Drinks segment. Furthermore, the Drinks segment only has 26% of total net assets, yet it provides 46% of operating profits. Comparing this to the Retailing segment, which utilizes 40% of net assets while only contributing 24% of the total profits, shows a great disparity. The Food segment represents 34% of net assets and 30% of the total profits.

The focus of EEC’s investment of the purchasing of the supplier is to cut down on

Bubba, I am writing this memo so that you can further understand the problem that you are encountering. You want to receive further funding in order for your restaurant to grow and expand across the country. The issue that the bank is having with you and the restaurant is that you are not supplying sufficient evidence for them to decide whether or not they want to grant the loan to you to expand your restaurant. Before the bank can decide on your loan, they require financial statements documenting the revenues, profits, and assets of your restaurant. These statements show the bank if you possess enough funds in order to pay back the loan but they also use it to measure the amount of potential for the restaurant because whenever a bank grants a loan to a business or business owner, they are making an investment in that individual or business.

In order to ensure compatibility (conjugation) and information security, harmonization of existing and emerging government information systems

a service department’s costs have been allocated, costs are not reallocated back to it under

Home Depot and Lowe’s have similar business models. However, Home Depot seems to be growing faster than Lowe’s. In addition, Home Depot achieves higher returns on the capital invested by their shareholders. Not only does Home Depot have a higher ROE, but they also achieved a higher ROA and as a result Home Depot has a higher ROFL, caused by its higher use of liabilities as a source of financing. Home Depot has a higher PM with 8% compared with Lowe’s at 6%. Lowe’s and Home Depot both came in at around 34% with gross profit margin. Home Depot achieves a higher turnover of total assets. A closer analysis of turnover ratio reveals that ART is extremely high for Home Depot indicating that accounts receivables are being collected more quickly, while

Therefore, due to these differences in approach of the management, the profitability margins are so different for these two companies.

9. Recall Buckeye National Bank’s bonus-based incentive plan to increase the number of customers. Do you believe this strategy is wise? Would you

They carry a larger proportion of current assets relative to their operating revenue than their competitor.

Return on sales (ROS) is determined by dividing operating profit, an interchangeable term with EBIT, by sales. RadioShack experienced a 14%

Traditionally, we have been taught that there are some simple ratios such as Net Income Assets (ROA) or Net Income over Equity (ROE) that allow you to gain a broad understanding of the firm's profitability. Table: Profitability has calculated the broad ROA and the traditional ROE is similar to the decomposed ROE. These numbers show that Net Income for FedEx is comparatively much smaller than UPS's Net Income in relation to assets and equity. For each dollar invested in equity UPS earns 23 cents versus FedEx's 15 cents per dollar of equity. Likewise, UPS earns 11 cents versus FedEx's 7 cents per dollar of assets.

Traditionally, the business performance of each regional manager is measured against a set profit plan, with Jacques rewarding his managers a fixed payout of 2% of corporate profits as a bonus. However, the organization is facing many business firsts, which when

Historically, the Du Pont innovation of (ROI) calculations represents one of the most significant turning points in the history of modern accounting and management, (Hounshell, 1998 ). The 1920’s began the Du Pont system company with methods and calculations from leaders, owners, executives, etc. Furthermore, it was the beginning of the integration of financial accounting, capital accounting, and cost accounting. When it comes to return on assets (ROA), they are a (ROI) measure that evaluates the organization’s return or net income relative to the asset base need to generate the income, (Finkler, Ward, & Calabrese, 2013). The Du Pont Company has been the leader of industrial research. Throughout the years with companies emerging, Du Pont’s method was becoming more prominent with owners and executives needing a method for

Company operates in the Industrial Sector – Services, and Industry – Regional Airlines. According to the Standard Industrial Classification System (SIC), company belongs to the industry group 451: Air

Performance should be measured by looking at joint profit. There is in effect a transfer