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1.”Non financial performance indicators offer a means of counteracting short-termism”
In the BPP book the sentence is true. Briefly could you explain why?2.EQUITY AND LIABILITY
Capital and reserve $585,000
Long term liabilities $670,000
Current liabilities $84,000What is the gearing ratio?
-In the BPP book the working is as follows:
670,000/585,000 x 100 = 114.5%According to the formula the denominator should be added with 670,000
(670,000/670,000+585,000 x 100)Could you please clear this for me?
Thanks.
1. Financial performance measures look at the current year and are therefore short-term.
Non-financial items such as quality will have impacts in the future and are therefore more long-term. (Read the first paragraph of the relevant chapter in the free lecture notes).2. The answer in the current edition of the BPP Revision Kit is certainly not 114.5%.
I have it in front of me and their answer is 670,000/(670,000+585,000) = 53.4%, which is correct.strategic benchmarking compares our company’s long-term strategies and general approaches with those of other companies that have done well.
1. what is internal benchmarking?
2. When calculating ROCE; for total long term capital, should be include retained earnings?
1. Comparing one department/division with other departments/divisions in the same company.
2. Yes
What is meant by
1.cost value
2. exchange value
3.use value
4. esteem valuewhat’s the difference between competitive and strategic benchmarking?
cost value – the price paid for the item
exchange value – what the item could be sold for
use value – how much an asset is worth to the business
esteem value – how much customers would be prepared to pay for it
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