Reporting in Action — BTN 22-1
1. Apple revenues by product line
($ in millions)
September
28, 2013
September
29, 2012
September
24, 2011
Total revenues ………………………………………
$170,910
$156,508
$108,249
90,583
82,949
57,373
iPad and iPod (21%) …………………………..
35,891
32,867
22,732
Mac (13%) ……………………………………….……
22,218
20,346
14,072
22,218
20,346
14,072
* Revenue rounded up so product line total revenues sum to total revenues.
2. Apple can divide up the operating expenses into product line direct and
indirect expenses. Some of the direct expenses of a particular product
line might be cost of goods sold, the product line manager’s salary,
3. Solution depends on the particular annual report information obtained.
1. Profit margin = Net income/Sales
2. Investment turnover = Investment center sales
Investment center average assets
3. Apple’s profit margin (21.7%) is nearly identical to Google’s (21.6%).
Therefore, for every dollar of sales, the two competitors yield roughly
1. There is an ethical concern in this situation. Pincus is taking actions
he would not otherwise take. He believes that “minor compromises” in
his behavior do not significantly affect clients. However, the problem is
2. Given that Pincus is aware of his behavior, its potential consequences,
and the source of what’s behind his behavior (in this case the focus by
management on meeting the quarterly responsibility performance
budget), he can approach his superiors (at least one or two he trusts)
3. Super Security (the employer) is ultimately responsible for any action
taken by its employees, including Pincus. Management must establish
an ethical code of conduct to ensure that department managers do not
engage in unethical behaviors that compromise the security of its
clients. To facilitate the implementation of such a code of conduct,
FROM: Your Name, National Office Manager
SUBJECT: New Performance Reporting
DATE: Current Date
All current and future periods’ performance reports for all managers
include an allocation of home office expenses. These expenses will be
1. The tutorials identified and read by the students will vary. For example,
one tutorial is titled “Return on Investment and Return on Equity
2. Student responses regarding the usefulness of spreadsheets will
depend on the tutorials accessed. For example, the tutorial “Return on
Investment and Return on Equity Business Model” shows how a
analysis.
1. The student must make decisions about geographic area, type of
business segment, and reporting structure. The objective is to have
them think about the many different ways a business can set up
2. Having comparable responsibility accounting reports is necessary to
reliably compare performance within a company (and across different
companies). Differences in performance reports can substantially
1. Departmental income statements can be prepared for each department
once expenses have been allocated to it. The expenses will include both
2. If the indirect expenses are a large portion of total expenses, a
departmental income statement might not be the best measure of each
department’s performance. While the department’s income or loss is
3. United By Blue could use ratings from customer satisfaction surveys,
the number of repeat customers, the percentage of orders returned, and
1. [Student answers will vary for part (1).] One suggested responsibility
accounting reporting framework is to have (1) concessions and (2)
2. One suggested proposal is
Expense
Allocation Basis
Heat ………………………….
Square footage occupied
Rent ………………………….
Sales dollars
Insurance ………………….
Square footage occupied
Maintenance …….……….
Time in process—with a standard time to clean a
theater after a show
1. Net sales percentage growth [non-percents in ₩ millions]
Segment
Net sales % change from 2012 to 2013
Consumer electronics ……….………..
(₩50,332 – ₩51,105) / ₩51,105 = -1.5%
IT and mobile
communications ……………….………..
(₩138,817 – ₩105,845) / ₩105,845 = 31.2%
2. Percentage growth in net sales is higher in the IT and mobile
3. The IT and mobile communications segment earned more operating
4. Samsung’s management can use this information to help establish
long-term goals and strategies and for resource allocation decisions.
An important factor in the valuation of any company is its ability to