Skip to content

CMA Intermediate · Management Accounting · Divisional Performance Measurement

Kaveri Textiles Ltd uses a Balanced Scorecard. Which of the following measures belongs to the 'Internal Business Process' perspective as classified by Kaplan and Norton?

Manufacturing cycle efficiency belongs to the internal business process perspective because it assesses how efficiently the firm's operations convert time into value-adding activity. Customer retention is a customer measure, ROCE is financial, and training hours are learning and growth measures.

  1. ACustomer retention rate
  2. BManufacturing cycle efficiencyCorrect
  3. CReturn on capital employed
  4. DEmployee training hours per head

Explanation

Manufacturing cycle efficiency measures how well the production process uses time, so it is an internal process measure. Customer retention belongs to the customer perspective, ROCE to the financial perspective, and training hours to learning and growth.

Did you get it right without looking?

One question tells you little. A timed set on Divisional Performance Measurement shows your real accuracy, how long you take and where you lose marks.

Practise Divisional Performance MeasurementFree diagnostic mock

More Divisional Performance Measurement questions