Which of the Following Financial Performance Measures Can Be Used

question 142

Multiple Choice

Which of the following financial performance measures can be used to compare potential projects of different sizes?

• A) EVA
• B) Residual income
• C) ROI
• D) Operating income

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Definitions:

Step-down Method

A cost allocation method used in managerial accounting to distribute overhead costs to various cost objects, considering the support departments provide to each other.

General Management

The executive and organizational activities involved in directing a company or one of its departments, focusing on strategy, policy development, and achieving business objectives.

Physical Plant

Refers to the physical facilities of a business, including buildings and equipment.

Step-down Method

An allocation method used in cost accounting to distribute overhead costs to various cost centers and products in stages based on their usage of services.