Businesses and the Balanced Scorecard

Businesses and the Balanced Scorecard
Businesses and the Balanced Scorecard

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Businesses and the Balanced Scorecard

Compute activity-based costing rates for a law firm, and then write a 1–2-page analysis of the role of the balanced scorecard approach to performance management.

By successfully completing this assessment, you will demonstrate your proficiency in the following course competencies and assessment criteria • Competency 3: Operate service-based cost accounting systems.

Compute activity-based costing for a service business.o Compute budgeted overhead rates for cost pools.
• Competency 4: Apply cost analysis to assist management decision making.
o Analyze the impact of preparing a balanced scorecard on a business strategy plan.
o Compare and contrast three organizations’ use of the balanced scorecard approach.


In contrast to a job-costing system that collects costs for each unit produced, process-costing systems accumulate costs in a department for an accounting period and spread them evenly, or average them, over all units produced in that accounting period. For example, a print shop collects costs for each order, a defense contractor collects costs for each contract, and a custom homebuilder collects costs for each home that is built.

Process costing is used when it is not possible or practical to identify costs with specific lots or batches of product. Process costing assumes that each unit produced is relatively uniform. If a product moves through various stages during its assembly or creation, it is likely that the costs were accumulated by the department and applied at the end of the assembly line. For example, it is probably not important for Intel to know whether the cost of the 10,001st microprocessor chip is different from chip number 10,002, particularly if the unit cost is calculated primarily to value inventory for external reporting purposes.

Businesses and the Balanced Scorecard


The following resources are required to complete the assessment.
• Assessment 5 Template.
• Cutler, T. R. (2010). The language of cost. Industrial Engineer, 42(9), 47–50.• Jagolinzer, P. (2000). Cost accounting: An introduction to cost management systems. Cincinnati, OH: South-Western College Publishing.• Kren, L. (2014). Tracking value created by efficiency improvements in a traditional overhead cost management system. Engineering Management Journal, 26(1), 3–7.

• Lee, R. T. (2013). Target: Carrying costs. Industrial Engineer, 45(8), 38–42.• Marshall, P. D., & Dombrowski, R. F. (2003, February/March). A small business review of accounting for primary products, byproducts and scrap. National Public Accountant, 10–13.
• Pachura, R. (1998). When is enough, enough?. IIE Solutions, 30(10), 33–35.• Rao, S. S. (1997). ABCs of cost control. Inc. Tech, 19(9), 79–81.• Rikhardsson, P. M. (2004). Accounting for the cost of occupational accidents. Corporate Social – Responsibility and Environmental Management, 11(2), 63–70.• The payroll handover. (1997, August). Management Today, 13.
VanDerbeck, E. J. (2013). Principles of cost accounting (16th ed.). Mason, OH: South-Western Cengage Learning.o Chapter 9.

Businesses and the Balanced Scorecard

Assessment Instruction

For this assessment, complete the following two parts:

Part 1: Use the Assessment 5 Template (linked in the Resources) and the scenario it contains to compute activity-based costing rates for a law firm. Also compute the budgeted overhead rates for each of the three cost pools identified in the template.

Part 2: Consider what you know about cost accounting and service businesses as you write a 1–2-page analysis that addresses the following:
1. Analyze the reasons a company should bother with a balance scorecard approach to performance measurement when its primary goal is to earn a sufficient return on investment for its shareholder.
2. Search online for and examine organizations currently using the balance scorecard as part of their financial and strategic planning. Select three different companies or organizations, and compare and contrast their use of the balance scorecard approach.

Write your analysis in Microsoft Word. Use 12-point font, and double space. Follow APA style for citations and references.
Submit both the completed template and the Microsoft Word document for this assessment.

Below is a partial answer to the above homework questions by one of our writers. If you are interested in a custom non plagiarized top quality answer, click order now to place your order.

Businesses and the Balanced Scorecard Essay

Balance score card is the current approach used by the management as thinking, it consists of both financial and non-financial indicators. Balance score card is based on three areas which are responsible for the success of the company (Shutibhinyo, 2013). The areas that balance score card do focus on; financial perspective, internal business perspective, learning and growth and customer perspective.

Financial perspective; this is a perspective that is modified the company performance by comparing market future price or value of the stock with the current value.  The second area that balance scorecard puts an emphasis on is the customer perspective; this is how company customers view the company (Shutibhinyo, 2013). Under this perspective, there are four areas that the company should consider. These include customer satisfaction, customer loyalty, and acquisition of customers and market share of the company.

The third perspective is the internal business perspective; this perspective gives an idea of how a company can stay ahead of its competitors by emerging the top in the market. A company has to review its internal structure to ensure that both customer’s demands and shareholder’s interests are considered in order for the company to reach the higher limits set by management.

The fourth and last perspective of balance scorecard is learning and growth perspective; a company must be innovative in order to achieve its growth desires. Company growth involves having competence staff and degree of uniqueness of the products that a company produces. Staffs should set their profession to match any technical changes for example change in tax laws. This is needed for full customer satisfaction and improve the corporate image (Shutibhinyo, 2013).

This approach is used by companies because it is based on both financial and non-financial performance. The approach focuses on maximizing the shareholders wealth and meeting consumer demands. Non-financial issues that balance score card address ii customer satisfaction, self-motivation, and innovation…..

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