Chapter11: Performance Measurement in Decentralized Organizations

An integrated set of performance measures that are derived from and support the organization's strategy.(p. 485)

A business segment whose manager has control over cost but has no control over revenue or investments in operating assets. (p. 474)

An organization in which decision-making authority is not confined to a few top executives but rather is spread throughout the organization. (p. 473)

The elapsed time from receipt of a customer order to when the completed goods are shipped to the customer. (p. 482)

A concept similar to residual income in which a variety of adjustments may be made to GAAP financial statements for performance evaluation purposes. (p. 479)

A business segment whose manager has control over cost, revenue, and investments in operating assets. (p. 475)

Process (value-added) time as a percentage of throughput time. (p. 483)

Net operating income divided by sales. (p. 476)

Income before interest and income taxes have been deducted. (p. 475)

Cash, accounts receivable, inventory, plant and equipment, and all other assets held for operating purposes. (p. 476)

A business segment whose manager has control over cost and revenue but has no control over investments in operating assets. (p. 474)

The net operating income that an investment center earns above the minimum required return on its operating assets. (p. 479)

Any business segment whose manager has control over costs, revenues, or investments in operating assets. (p. 474)

Net operating income divided by average operating assets. It also equals margin multiplied by turnover. (p. 475)

The amount of time required to turn raw materials into completed products. (p. 482)

Sales divided by average operating assets. (p. 476