A Divisional Manager's Performance Is Evaluated on the Basis of the Difference

question 61

Multiple Choice

A divisional manager's performance is evaluated on the basis of the difference between the sales revenues generated by that division and the cost of making those goods and services.The divisional manager being evaluated using the _____________ budget approach.

• A) profit
• B) revenue
• C) cash flow
• D) cost
• E) expense

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Definitions:

Profitability Analysis

Marketing analytics tool that measures how much profit the firm generates, as well as how much profit certain aspects of the firm, including regions, channels, and customer segments, contribute.

Profit Margin

A financial metric that measures the percentage of revenue that exceeds the cost of goods sold, indicating the profitability of a business.

Revenue Analysis

A process of reviewing and evaluating the income generated from operations, usually to understand financial performance and identify improvement areas.

Strategic Planning

A systematic process for envisioning a desired future and translating this vision into broadly defined goals and a sequence of steps to achieve them.