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Activity-Based Responsibility and Strategic-Based Responsibility Incorporate Some of the Same

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Essay

Activity-based responsibility and strategic-based responsibility incorporate some of the same elements. However, strategic-based responsibility adds some new elements to the common dimensions. What are the elements in common and what new elements are included?


Definitions:

Residual Income

Income that remains after all costs and expenses, including the cost of capital, have been subtracted from net revenues.

Riskiness Of Investments

The degree of uncertainty associated with the returns on investments, indicating the potential to lose some or all of the original investment.

Investment Turnover

A financial ratio that measures the efficiency of a company's use of investments in assets to generate sales or revenue.

Return On Sales

A financial ratio that calculates the percentage of sales revenue that has turned into profits, indicating how efficiently a company is operating.

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