Terms

Question	Answer
Balanced Scorecard	A performance measurement system that includes both lagging and leading indicators.
Centralized Organization	An organization in which high-level executives make most of the decisions and charge others with implementing those decisions.
DuPont Method	A performance measurement method that looks at investment turnover and profit margin to gain a better understanding of the contributing factors.
Hurdle Rate	The minimum required rate of return for a project.
Investment Center	A center where the manager has the responsibility to control revenue, costs, and manage assets.
Profit Center	A center where the manager has the responsibility to control both revenue and costs.
Cost Center	A center where the manger is only responsible to control costs.
Revenue Center	A center where the manager has the responsibility to generate revenues.
Profit Margin	The ratio of net operating income to sales revenue.
Return on Investment (ROI)	Net operating income divided by average invested assets.

Resource summary

	Created by Mariah Bruce over 5 years ago