Matt Manages the Sales Unit at Global Electronics but Has

question 10

Multiple Choice

Matt manages the sales unit at Global Electronics but has no control over input costs.The primary purpose of the sales division is to sell goods produced by another division at Global Enterprises.What is the most appropriate performance evaluation measure for Matt's division?

• A) market share
• B) profitability
• C) net income as a percentage of sales
• D) inventory costs as a percentage of sales

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Definitions:

Partly Owned Subsidiaries

Subsidiaries that are not wholly owned by the parent company, implying the existence of minority or non-controlling interests.

Ownership Interests

Rights or claims to assets and earnings, often associated with the holding of equity or shares in a company.

Fair Value Method

An accounting approach that assesses the price of an asset or liability based on current market conditions, rather than historical cost.

Goodwill

An intangible asset that arises when a company acquires another company for a price greater than the fair value of its net identifiable assets.