Methods for evaluating the performance of divisions, Strategic Management

Assignment Help:

Q. Methods for evaluating the performance of divisions?

Profit based methods for evaluating the performance of divisions

Operating profit (net profit) margin 

=           (Profit before interest and tax (PBIT)/ Turnover)x 100% 

Gross profit (sales) margin 

   =            (Turnover less cost of sales (gross profit)/ Turnover)   x 100%                

Generally the gross profit or sales margin can also be referred to as the contribution to sales (C/S) ratio e.g. gross profit (sales less variable cost) ÷ sales.                

Mark up

        =          (Turnover less cost of sales (gross profit) / Cost of sales) x 100%          

Controllable profit

The controllability principle indicated that a manager should not be assessed on costs which are not within their own control.


Related Discussions:- Methods for evaluating the performance of divisions

Explain porter''s five forces analysis of the beer industry, Question 1: ...

Question 1: Mauritian sugar companies decide to go and invest in sugar cane farming and sugar production in an African country. What sort of study must they carry out on the co

Describe the administration controls, Administration controls are performan...

Administration controls are performance measurement systems e.g. Management accounting 'exceptionreporting' systems which compare actual performance to a predetermined target, goal

Assignment, TicketID: EM201729KAT59SM where is my assignment,. I would lik...

TicketID: EM201729KAT59SM where is my assignment,. I would like to track process.

What is strategy & why strategy is important?, What Is Strategy & Why Strat...

What Is Strategy & Why Strategy Is Important? Managers at all companies facade three innermost questions in view strategically concerning their companies' current circumstances

Prepare a complete training plan, The M.V Star of the orient is a 14,000 to...

The M.V Star of the orient is a 14,000 ton-cruise ship that was built in 1977. The ship is Greek-registered and Hong-Kong owned. The ship spent the ten years prior to 1989 cruising

Competitive benefit based on differentiation derives from, Offering product...

Offering products or services which offer dissimilar advantages from competitors' and which are valued by purchasers.

Banking systems fraud and technology approach, Banking Systems Fraud and Te...

Banking Systems Fraud and Technology Approach It is my intention to use the Banking Systems in Nigeria for this case study. I have observed that the process of banking operat

International aspects to transfer pricing, Q. International aspects to tran...

Q. International aspects to transfer pricing? The following issues can influence international transfer pricing decisions. Exchange rates e.g. fluctuations in global cur

Importance of strategic management , Discuss What is the importance of stra...

Discuss What is the importance of strategic management towards the success of a business? Ans) Strategic management used to play a dissimilar after the Second World War. Strateg

Write Your Message!

Captcha
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