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what is the difference between controllable and traceable profit? how can we calculate it?
Profit is the revenue less the costs.
Traceable costs and revenues are those that can be identified as being costs and revenues of the division, and are relevant for measuring the performance of the division.
Controllable costs and revenues are those that are controlled by the division (as opposed to being determined by the head office) and are relevant for measuring the performance of the manager of the division.
As to how to calculate the profit, you add up the relevant costs and subtract them from the revenue. Which costs are controllable is made clear in the question.
Have you watched my free lectures on performance measurement? The lectures are a complete free course for Paper MA and cover everything needed to be able to pass the exam well.
You will find plenty of exam-standard question on this topic in your Revision Kit.
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