Calculate return on assets (ROA)

1. Management Accounting versus Financial Accounting

Management accounting differs from financial accounting in a number of ways. Indicate whether each of the following characteristics relates to management accounting (MA) or financial accounting (FA):

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1. Publically reported

2. Forward looking

3. Usually confidential

4. Complies with accounting standards

5. Reports past performance

6. Uses physical measures as well as monetary ones for reports

7. Fous on business decision making

8. Driven by users needs


2. The Balanced scorecard: Stakeholder Values.

In the balanced scorecard approach, stakeholder groups with different perspectives value different performance goals. Sometimes, however, they may be interested in the same goal. Indicate which stakeholder groups –financial (F), learning and growth (L),internal business processes (P),and customer (C)-value the following performance goals:

1. High wages

2. Safe products

3. Low –priced products

4. Improved return on investment

5. cost –effective production processes


3. XYZ Co. wants to know if its profitability performance has increased from 2009 to 2010.The company had net income of $48,000 in 2009 and $50,000 in 2010.Total assets were $480,000 at the end of 2009, and $560,000 at the end of 2010.calculate return on assets (ROA) for 2009 and 2010 and comment on the results.

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