ACC513 Managerial Accounting Lesson 5 –Investment Center Performance Evaluation and Incentive Issues Introduction This lesson discusses concepts and methods of measuring performance and controlling activities in multidivision organizations. Return on investment (ROI) as a performance measure is interpreted. Further, divisional organizations engage in transfer pricing. These rules are introduced and the behavioral issues are analyzed. The economic consequences of multinational transfer prices are explained. There are incentive issues in allocating costs to divisions when measuring divisional performances. The contribution approach to divisional reporting improves management decisions. ROI is compared to economic value added. Students will explore issues in the design Read More …