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Managerial Accounting: The Corners...

7th Edition
Maryanne M. Mowen + 2 others
ISBN: 9781337115773

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BuyFindarrow_forward

Managerial Accounting: The Corners...

7th Edition
Maryanne M. Mowen + 2 others
ISBN: 9781337115773
Textbook Problem
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A Box Scorecard was prepared for a value stream:

Chapter 13, Problem 45E, A Box Scorecard was prepared for a value stream: Required: 1. How many nonfinancial measures are

Required:

  1. 1. How many nonfinancial measures are used to evaluate performance? Why are nonfinancial measures used?
  2. 2. Classify the operational measures as time-based, quality-based, or efficiency-based. Discuss the significance of each category for lean manufacturing.
  3. 3. What is the role of the Planned Future State column?
  4. 4. Discuss the capacity category and explain the meaning of each measure and its significance.
  5. 5. Discuss the relationship between the financial measures and the measures in the operational and capacity categories.

1.

To determine

List the non-financial measures used in the performance evaluation. Also, explain the reasons due to which non-financial measures are used.

Explanation

Value Stream:

Value stream consists of the processes through which a product goes; that is from procurement to delivery. In value stream, all processes are covered whether or not they add value to the product.

Non-financial measures used in the performance evaluation are listed as follows:

  • Units sold per person
  • On-time delivery
  • Dock-to-dock days: It is the number of days for which a good stays with the manufacturer or the days between when the raw material is shipped to the manufacturer and the resulting finished goods shipped to the customer.
  • First-time through: It is the percentage that defines defect free units...

2.

To determine

Provide classification of operational measures. Also, explain the significance of each category for lean manufacturing.

3.

To determine

Explain the role of planned future state column.

4.

To determine

Explain the meaning of capacity category and its significance.

5.

To determine

Explain the relationship between the financial measures and the measures in the operational and capacity categories.

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