Question

What would you include in a recommendation to the CEO for a better method for evaluating the performance of the divisions?

a.The method used to evaluate the performance of the divisions should be reevaluated.

b.A better divisional performance measure would be the rate of return on investment

c.A better divisional performance measure would be the residual income.

d.None of these choices would be included.

e.All of these choices (a, b & c) would be included.

Answer 1

Option D

Step-by-step explanation:

In simple words, method of performance division is considered to be effective when it depicts a true picture, not because it gives a sound position of the organisation as waned by the managers.

Thus, reticulation should not be done. Also, Divisional performance should be judged by some other aspects like time taken to perform the job or wastage done by them etc.