Question

1. Which is not a limitation of using accounting data?

A. Accounting data may not be up to date.

B. All accounting data are historical and thus look backwards, not forwards.

C. Accounting data focus mainly on tangible assets which may not be the most important set of assets.

D. Accounting data do not consider off-balance sheet items.

2/ A good definition of total return to shareholders is

A. Return on risk capital that includes stock price appreciation plus dividends received over a specific period.

B. Total dollar market value of a company's total outstanding shares at any given point in time.

C. Return on assets.

D. Accounting data capturing the firm's actual costs of assets minus depreciation

3/ Economic Value Added (EVA)

A. is the difference between a buyer's willingness to pay for a product/service and the firm's total cost to produce it.

B. and competitive advantage are fundamental concepts in strategic management.

C. can be either (or both) a short term measure or a long-term measure of performance.

D. can easily change over time.

E. is represented in all of the answers.

4/ Which is not a question addressed by the Balanced Scorecard approach?

A. How do we create value?

B. How do customers view us?

C. How do shareholders view us?

D. How do competitors view us?

E. What core competencies do we need?

Answer 1

1 B) All accounting data are historical and thus look backwards, not forwards, So this is not a limitation and there is no question mark on the accuracy of the data so one can easily use data for purpose depending on objective.

2 A) Return on risk capital that includes stock price appreciation plus dividends received over a specific period.

3 E. is represented in all of the answers, EVA( economic value added) is an  estimate of a company's economic profit, or the value created in excess of the required return of the company's shareholders, which might change over a period of time.

4 E. What core competencies do we need?