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Multiple Choice
Which of the following performance measures are part of the balanced scorecard?
A
Financial, Customer, Internal Business Processes, and Learning & Growth
B
Liquidity, Solvency, Profitability, and Market Value
C
Current Ratio, Quick Ratio, Debt-to-Equity Ratio, and Inventory Turnover
D
Return on Assets, Earnings Per Share, Price-Earnings Ratio, and Dividend Yield
Verified step by step guidance
1
Step 1: Understand the concept of the balanced scorecard. It is a strategic management tool used to measure organizational performance from multiple perspectives, not just financial metrics. The four key perspectives are Financial, Customer, Internal Business Processes, and Learning & Growth.
Step 2: Compare the options provided in the problem to the balanced scorecard framework. Look for the set of measures that align with the four perspectives of the balanced scorecard.
Step 3: Eliminate options that focus solely on financial metrics, such as liquidity, solvency, profitability, and market value, as these do not encompass the broader perspectives of the balanced scorecard.
Step 4: Similarly, eliminate options that focus on specific financial ratios like current ratio, quick ratio, debt-to-equity ratio, and inventory turnover, as these are not part of the balanced scorecard framework.
Step 5: Identify the correct option that includes Financial, Customer, Internal Business Processes, and Learning & Growth, as these are the core components of the balanced scorecard.