会计学原理英文课件-(24)

1、Chapter 24Performance Measurement and Responsibility AccountingProvide informationfor managers to usein performanceevaluation.Assign costs tomanagers who areresponsible forcontrolling the costs.PrimarygoalsResponsibility Accounting Large complex businesses are divided into departments enabling manag

2、ers to have a smaller effective span of control.Motivation forDepartmentalizationProductionSalesServiceDepartments are established for specialized functions.Departmental Evaluation The accounting system provides information about resources used and outputs achieved. Managers use this information to

3、control operations, appraise performance, allocate resources, and plan strategy. The type of accounting information provided depends on whether the department is a . . .Evaluated on ability tocontrol costs.CostcenterEvaluated on abilityto generate revenuesin excess of expenses. ProfitcenterEvaluated

4、 on abilityto generate return on investment in assets. InvestmentcenterControllable versusUncontrollable CostsA cost is controllable if a manager has the power to determine or at least significantly affect the amount incurred. Uncontrollable costsare not within the managers control or influence.The

5、department managers own salarySupplies used in the managers departmentAn accounting system thatprovides information . . . Responsibility Accounting SystemRelating to theresponsibilities ofindividual managers.To evaluatemanagers oncontrollable items.P1Responsibility Accounting Successful implementati

6、on of responsibility accounting may use organization charts with clear lines of authority and clearly defined levels of responsibility.P1Amount of detail varies according to the level in the organization.A department manager receives detailed reports.A store manager receives summarized information f

7、rom each department.Responsibility AccountingPerformance ReportsP1 To be of maximum benefit, responsibility reports should . . .Be timely.Be issued regularly.Be understandable.Compare budgetedand actual amounts.Responsibility AccountingPerformance ReportsP1P1 Direct expenses are incurred for the sol

8、e benefit of a specific department. Indirect expenses benefit more than one department and are allocated among departments benefited.Direct and Indirect ExpensesC1Illustration of IndirectExpense Allocation Classic Jewelry pays its janitorial service $300 per month to clean its store. Management allo

9、cates this cost to its three departments according to the floor space each occupies.C 1Allocation of Indirect ExpensesIndirect expenses can be allocated to departmentsusing a number of allocation bases. Some common indirectexpenses and their allocation bases are:P 2 Service department costs are shar

10、ed, indirect expenses that support the activities of two or more production departments.Service Department ExpensesP 2Departmental Income StatementsP 3Lets prepare departmental income statements using the following steps:Accumulating revenues and direct expenses by department. Allocating indirect ex

11、penses across departments.Allocating service department expenses to operating departments.Preparing departmental income statements.Revenues and/or Direct expenses are tracedto each department without allocation.Departmental Income Statements Step 1P 3Operating Dept. OneOperating Dept. TwoRevenues an

12、d Direct ExpensesRevenues and Direct ExpensesDirect ExpensesDirect ExpensesService Dept. OneService Dept. TwoIndirect expenses are allocated to all departmentsusing appropriate allocation bases. AllocationAllocationAllocationAllocationP 3Departmental Income Statements Step 2Service Dept. OneService

13、Dept. TwoOperating Dept. OneOperating Dept. TwoOperating Dept. OneOperating Dept. TwoService department total expenses (original direct expenses + allocated indirect expenses) areallocated to operating departments. AllocationAllocationP 3Service Dept. OneService Dept. TwoDepartmental Income Statemen

14、ts Step 2Departmental ExpenseAllocation SpreadsheetStep 1: Direct expenses are traced to service departments and sales departments without allocation.P 3Departmental ExpenseAllocation SpreadsheetStep 2: Indirect expenses are allocated to both the service and the sales departments based on floor spac

15、e occupied. Of a total of 2,000 square feet, the service departments occupy 200 square feet each, sales department one occupies 600 square feet, and sales department two occupies 1,000 square feet. P 3Sales department one has $40,000 in sales and sales department two has $48,000 in sales. Step 3: Se

16、rvice department total expenses (original direct expenses + allocated indirect expenses) are allocated to sales departments. Departmental ExpenseAllocation SpreadsheetP 3Departmental ExpenseAllocation SpreadsheetSales department one has 28 employees and sales department two has 40 employees. Step 3:

17、 Service department total expenses (original direct expenses + allocated indirect expenses) are allocated to sales departments. P 3DepartmentalIncome StatementsP 3 Departmental contribution . . . Is used to evaluate departmental performance.Is not a function of arbitrary allocations of indirect expe

18、nses. Departmental revenue Direct expenses = Departmental contributionDepartmental Contributionto OverheadA department may be a candidate for elimination when its departmental contribution is negative.P 3Departmental Contributionto OverheadNet income for the company is still $17,500.Departmental con

19、tributions to indirect expenses (overhead) are emphasized. Departmental contributions are positive so neither department is a candidate for elimination.P 3Investment Center Returnon Assets Invested (ROI)ROI = Investment Center Net IncomeInvestment Center Average Invested AssetsLCD Division earned mo

20、re dollars of income, but it was lessefficient in using its assets to generate income comparedto S-Phone Division.A 1ResidualIncomeInvestment CenterNet IncomeTarget InvestmentCenter Net Income=Investment CenterResidual Income The target net income is 8% of divisional assets.A 1Investment Center Prof

21、it Marginand Investment TurnoverA 2Return oninvestment (ROI)=ProfitMarginInvestmentturnoverDomestic ROI = 20.59%International ROI = 1.01%Innovation and LearningHow can we continuallyimprove and create value?Internal Business ProcessesIn which activities must we excel?Balanced ScorecardPerformance Me

22、asuresFinancial PerspectiveHow do we lookto the firms owners?Customer PerspectiveHow do our customers see us?A 3Global ViewLOreal is an international cosmetics company incorporated in France. With multiple brands and operations in over 100 countries, the company uses concepts of departmental account

23、ing and controllable costs to evaluate performance. A recent annual report shows the following for the major divisions in LOreals Cosmetics branch:LOreals non-allocated costs include costs that are not controllable by division managers. Excluding noncontrollable costs enables LOreal to prepare more

24、meaningful division performance evaluations.Process time is the only value-added time.Process Time + Inspection Time+ Move Time + Wait Time Order ReceivedProductionStartedGoods ShippedManufacturing Cycle TimeCycle Time and Cycle EfficiencyA 4Total TimeManufacturingCycleEfficiency Value-added timeMan

25、ufacturing cycle time=Cycle Time and Cycle EfficiencyProcess Time + Inspection Time+ Move Time + Wait Time Order ReceivedProductionStartedGoods ShippedManufacturing Cycle TimeTotal TimeA 4A transfer price is the amount charged when onedivision sells goods or services to another division.LCD Displays

26、LCD DivisionS-Phone Division Appendix 24A: Transfer PricingS-Phone can purchase displays for $80 from other companies.C 2Appendix 24A: Transfer PricingLCD is producing and selling 100,000 units to outside customers.(No excess capacity)Transfer price = $80With no excess capacity, the LCD manager will not accept a transfer price less than $80 per monitor. The S-Phone manager cannot buy monitors for less than $80 from outside suppliers, so the $80 price is acceptable. LCD DisplaysLCD DivisionS-Phone Division C 2Appendix 24A: Transfer Pric