Managerial Accounting: P12-10 Spectrum Book company has 2 divisions

Managerial Accounting
P12-10 Economic Value Added and the Balanced Scorecard
Spectrum Book company has 2 divisions: the Brick and Mortar division sell books through more than 100 bookstores throughout the United States; the Internet division was formed 18 months ago and sells books via the internet. Data for the past year are:
Brick and Mortar Division Internet Division
Total assets 180,000,000 17,200,000
Noninterest bearing current liabilities 7,800,000 2,800,000
Interest expense 1,400,000 465,000
Net income (loss) 30,900,000 (1,250,000)
Tax rate 40% 0%
Cost of capital 13% 15%

Required:
a) Evaluate the 2 divisions in terms of economic value added (EVA)
B) Explain why it might be better to evaluate the Internet division in terms of a balanced scorecard rather than just using EVA.
C) Consider the customer and internal processes dimensions of the balanced scoreboard. Suggest 2 measures for each dimension that would be appropriate for the Brick and Mortar division and 2 measures for each dimension that would be appropriate for the Internet division.
D) A strategy map diagrams the relationship across the dimensions of the balanced scorecard. Identify the potential links between the customer and internal processes dimensions you identified in question c.
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