Balanced scorecard. (R. Kaplan, adapted) Petrocal, Inc., refines gasoline and sells it through its own Petrocal gas stations. On the basis of
- 1. Was Petrocal successful in implementing its strategy in 2017? Explain your answer.
- 2. Would you have included some measure of employee satisfaction and employee training in the learning-and-growth perspective? Are these objectives critical to Petrocal for implementing its strategy? Why or why not? Explain briefly.
- 3. Explain how Petrocal did not achieve its target market share in the total gasoline market but still exceeded its financial targets. Is ‘‘market share of overall gasoline marker the correct measure of market share? Explain briefly.
- 4. Is there a cause-and-effect linkage between improvements in the measures in the internal-business-process perspective and the measure in the customer perspective? That is, would you add other measures to the internal-business-process perspective or the customer perspective? Why or why not? Explain briefly.
- 5. Do you agree with Petrocal’s decision not to include measures of changes in operating income from productivity improvements under the financial perspective of the balanced scorecard? Explain briefly.
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Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
- Luxe Inc., a chain of gasoline service stations, has a strategy of charging premium prices for its gasoline by providing excellent service such as attendants to pump gas, clean restrooms, and free air for tire inflation. Its balanced scorecard performance measures include: Increase in operating income through cost reduction (Financial); market share in the overall gasoline market (Customer); wait-time at the pump (Internal Business Processes); and employee bonus based on number of customers served (Learning and Growth). Indicate whether each of these performance measures is appropriate, given Luxes strategy.arrow_forwardBasic Inc., a chain of gasoline service stations, has a strategy of charging discount prices for its gasoline by providing very little service and charging relatively high prices for the goods in its attached mini-market. Its balanced scorecard performance measures include: Increase in operating income through cost reduction (Financial); market share in the overall gasoline market (Customer); wait-time at the pump (Internal Business Processes); and store manager and employee bonus based on number of customers served (Learning and Growth). Indicate whether each of these performance measures is appropriate, given Basics strategy.arrow_forwardBased on Dobson and Kalish (1988). Chandler Enterprises produces two competing products, A and B. The company wants to sell these products to two groups of customers. The values each customer places on a unit of A and B are shown in the file P04_123.xlsx. Each customer will buy either product A or product B, but not both. A customer is willing to buy product A if she believes that the premium of product A is greater than or equal to the premium of product B and premium of product A is greater than or equal to 0. Here, the “premium” of a product is its value minus its price. Similarly, a customer is willing to buy B if she believes the premium of product B is greater than or equal to the premium of product A and the premium of product B is greater than or equal to 0. Group 1 has 1000 members, and group 2 has 1500 members. Chandler wants to set prices for each product to ensure that group 1 members purchase product A and group 2 members purchase product B. Determine how Chandler can…arrow_forward
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- Balanced scorecard, social performance. Comtex Company provides cable and Internet services in the greater Boston area. There are many competitors that provide similar services. Comtex believes that the key to financial success is to offer a quality service at the lowest cost. Comtex currently spends a significant amount of hours on installation and post-installation support. This is one area that the company has targeted for cost reduction. Comtex’s balanced scorecard for 2017 follows in the attatched: Q.Is there a cause-and-effect linkage between the measures in the internal-business-process perspective and the customer perspective? That is, would you add other measures to the internal-business-process perspective or the customer perspective? Why or why not? Explain briefly.arrow_forwardBalanced scorecard, social performance. Comtex Company provides cable and Internet services in the greater Boston area. There are many competitors that provide similar services. Comtex believes that the key to financial success is to offer a quality service at the lowest cost. Comtex currently spends a significant amount of hours on installation and post-installation support. This is one area that the company has targeted for cost reduction. Comtex’s balanced scorecard for 2017 follows in the attatched: Q. Why do you think Comtex included balanced scorecard measures relating to employee safety and community engagement? How well is the company doing on these measures?arrow_forwardBalanced scorecard, social performance. Comtex Company provides cable and Internet services in the greater Boston area. There are many competitors that provide similar services. Comtex believes that the key to financial success is to offer a quality service at the lowest cost. Comtex currently spends a significant amount of hours on installation and post-installation support. This is one area that the company has targeted for cost reduction. Comtex’s balanced scorecard for 2017 follows in the attatched: Q. Do you agree with Comtex’s decision to include measures of developing innovative services (research and development costs) in the internal-business-process perspective of the balanced scorecard? Explain brieflyarrow_forward
- Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning