Complete the following table by writing responses to the questions. Cite the sources in the text and list them at the bottom of the table.
What criterion must be met for true comparability?
Consistency, verification and unit measurement must all be met in order for true criteria. (Chp.14, pg.151) What elements of consistency should be considered? Provide an example. The elements of consistency that should be considered is time periods, consistent methodology, and inflation factors. An example of a time period would be that you could not compare a ten month time period to a twelve month period instead you would annualize the ten month period. An example of consistent methodology would be to use the same method throughout the entire time period. An example of inflation factors would be if expenses are expended then it is expected for expenses to increase. (Chp.14, pg.151-152) What is the manager’s responsibility in comparing data?
The manager’s responsibility in comparing data is to recall and apply the elements of consistency. This is critical because the consistency of data will be used to make decisions. (Chp.14, pg.152) What are the four common uses of comparative data?
The four common uses of comparative data are compare current expenses to current budget, compare current actual expenses to prior periods in own organization, compare to other organizations, and compare to industry standards. (Chp.14, pg.153-157) What is meant by standardized data?
Standardized data is data that aids in comparability. (Chp.14, pg.161)