Is Segment Margin an Appropriate Measure of Financial Performance for Segment

question 63

Essay

Is segment margin an appropriate measure of financial performance for segment management? Why?
Yes,it is an appropriate measure because all of the revenues and costs used to compute segment margin are directly traceable to the segment and are essentially under the control of the segment manager.Segment income is also a valuable measure of performance because it considers all costs that could be avoided without the segment.

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