Briefly explain why evaluation in terms of eva

Assignment Help Managerial Accounting
Reference no: EM13957695

Poseidon Electronics operates 10 stores in Washington, Oregon, and California selling consumer electronics including stereo equipment and home theater systems. The following financial information is available for 2012 and 2011.

590_259-B-M-A-P-E (1005).png

Required:

a. Although net income has increased by 6 percent, a shareholder evaluating the company's financial performance asserts that, in spite of the increase, financial performance has deteriorated in 2012. Support this assertion with appropriate calculations of EVA. Note that no adjustments are needed for accounting distortions.

b. Management asserts that the increased investment in the company's assets was clearly warranted since income increased. Briefly evaluate this assertion.

c. Briefly explain why evaluation in terms of EVA will drive managers to focus on carefully evaluating the investment in assets while this will not be the case if managers are evaluated in terms of growth in profit. 

Reference no: EM13957695

Questions Cloud

Find the average power produced by scott, in watts : Scott, riding for the Mercury team, won the 2002 Mt. Rushmore Hill Climb bicycle race with a winning time of 1 hour 50 minutes 20 seconds. The race is 28 miles in length with a total altitude gain of 7000ft. Scott weighs in at 130 lbs and his hill..
Find and solve the equation for cumulative distribution : Find the answers to parts (a) and (b) in the special case when the interarrival times are exponentially distributed with mean 1/A.
Calculate the impact of the exhibit on company profit : Calculate the impact of the exhibit on company profit. Should the company exhibit at the home show?
Director of continuous improvement of a company : Assume that you have recently been hired as the director of continuous improvement of a company. You are an outside hire with limited history of the firm and personal capital at the firm, and you are responsible for lean production, total quality ..
Briefly explain why evaluation in terms of eva : Briefly explain why evaluation in terms of EVA will drive managers to focus on carefully evaluating the investment in assets while this will not be the case if managers are evaluated in terms of growth in profit.
Process of metamorphism : Process of Metamorphism! In this weekly module, you will study about the term metamorphism. Meta=change, while morphism = change in the form rather than any chemical composition
Find the probability that the package from the machine weigh : Packages from packing machine have a mass, which is normally distributed with mean 200g and standard deviation 2g. Find the probability that the package from the machine weighs
What should it be when expressed in terms of d : The correct equation for the volume of a sphere is V = 4 pie r/3, where r is the radius of the sphere. Is the equation in exercise #20 correct? If not, what should it be when expressed in terms of d?
Discuss the importance of senior management : Please be advised that each answer will be turned into turnitin.com by teacher. Also, it is important that each answer is numbered according to the question.

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Manage budgets and financial plans

Explain the budgeting process and its importance to a business, identifying the components of different budgets, forecast estimates for inclusion in the budgets.

  Prepare a retained earnings statement

Prepare a retained earnings statement for the year and Prepare a stockholders' equity section of given case.

  Prepare a master budget for the three-month period

Prepare a master budget for the three-month period.

  Construct the companys direct labor budget

Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.

  Evaluate the predetermined overhead rate

Evaluate the Predetermined Overhead Rate

  Determine the company''s bid

Determine the company's bid if activity-based costing is used and the bid is based upon full manufacturing cost plus 30 percent.

  Compute the pool rates for the different activities

Complete the schedule to compute the pool rates for the different activities.

  Prepare Company financial statements

Prepare Company financial statements

  Prepare an analysis of terracycles

This individual assignment is based on the TerraCycle Inc.

  Discuss the ethical issues

Discuss the ethical issues

  Political resources in emerging markets

Calculate the GDP in Income Approach  and Expenditure Approach

  Management accounting - ehsan electronics company

A new plant accountant suggested that the company may be able to assign support costs to products more accurately by using an activity based costing system that relies on a separate rate for each manufacturing activity that causes support costs.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd