Question
P10-9 Performance Evaluations (M324) - Objs. 2, 5
The Promotion and Advertising Department at Jefferson Corporation coordinates point of purchase promotions for its distributors. Employees of this department are graphic arts or marketing majors who develop campaign materials and conduct market research. The department does not collect any revenue for these services. The department manager is evaluated based on the department's ability to operate within its budget. For the last several years, the manager has had to curtail many promotional programs a month before year-end in order to stay within budget.
Sales personnel, marketing representatives, and customers frequently complain when these services are terminated. Dan Beck, the department manager, told a colleague, "I hate taking all this heat every year. But I just can't afford to blow the budget." He also noted that "soon the new budget will be out, and I can give everyone what they want!"
Required
A. What type of responsibility center is the Promotion and Advertising Department?
The Promotion and Advertising Departments are both cost centers.
B. How is the department currently being evaluated? What are the important elements on which the department should be evaluated?
The department is currently being evaluated on its ability to control costs.
C. What appear to be the reasons for the department's budget problems? What implications does this have for the company?
The Promotion and Advertising Department at Jefferson Corporation coordinates point of purchase promotions for its distributors. Employees of this department are graphic arts or marketing majors who develop campaign materials and conduct market research. The department does not collect any revenue for these services. The department manager is evaluated based on the department's ability to operate within its budget. For the last several years, the manager has had to curtail many promotional programs a month before year-end in order to stay within budget.
Sales personnel, marketing representatives, and customers frequently complain when these services are terminated. Dan Beck, the department manager, told a colleague, "I hate taking all this heat every year. But I just can't afford to blow the budget." He also noted that "soon the new budget will be out, and I can give everyone what they want!"
Required
A. What type of responsibility center is the Promotion and Advertising Department?
The Promotion and Advertising Departments are both cost centers.
B. How is the department currently being evaluated? What are the important elements on which the department should be evaluated?
The department is currently being evaluated on its ability to control costs.
C. What appear to be the reasons for the department's budget problems? What implications does this have for the company?
Answers
Related Questions
The ABC Computer Corporation is considering an increase in its annual
advertising expenditure from...
Approximately how many people work in the:
Finance Department?
Sales Department?
Purchasing Depa...
Which department- headed by Thomas Jefferson- was created first?
Responses
A State DepartmentState...
Question 25 (1 point)
Listen
What are the four main tools of promotion?
Question 25 options:...