You are a former Navy officer and fighter pilot who is now the controller of a division of TransGlobal Airlines, which utilizes a fleet of corporate jets for
Scenario
You are a former Navy officer and fighter pilot who is now the controller of a division of TransGlobal Airlines, which utilizes a fleet of corporate jets for charter at several airports in the southeast part of the United States. Your division’s private charter clients include several Fortune 500 companies in the region. The Chief Financial Officer (CFO) has informed you that the company is considering the acquisition of two smaller aviation firms in the Caribbean specializing in chartered flights for luxury vacations using light aircraft (60 passengers or less). The CFO has tasked you with assessing the organizational benefits of acquiring these aviation firms. The CFO intends to develop a new business plan for the organization if your analysis recommends moving forward with the acquisition.
After an initial assessment, the company has shortlisted two airlines they want to examine further for acquisition. To understand all aspects of the two airlines under consideration, you have visited each proposed site to assess their performance. The assessment includes creating and analyzing a balanced scorecard for each airline with all four components—financial, internal processes, customers/market, and learning and growth—that will impact the acquisition.
In this milestone, you will use the given information to create balanced scorecards for Company A and Company B.
Prompt
Use the Basic Balanced Scorecard Template to create a balanced scorecard for each company. Specifically, you must address the following rubric criteria:
- Use the data given in Company A Information and Company A Financials to create a balanced scorecard for Company A. The balanced scorecard should highlight key performance indicators, such as net profit, annual growth, and market share, and include the four components:
- Financial: Complete the financial section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
- Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.
- Internal Processes: Complete the internal processes section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
- Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.
- Customers/Market: Complete the customers/market section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
- Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.
- Learning and Growth: Complete the customers/market section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
- Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.
- Financial: Complete the financial section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
- Use the data given in Company B Information and Company B Financials to create a balanced scorecard for Company B. The balanced scorecard should highlight key performance indicators, such as net profit, annual growth, and market share, and include the four components:
- Financial: Complete the financial section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
- Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.
- Internal Processes: Complete the internal processes section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
- Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.
- Customers/Market: Complete the customers/market section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
- Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.
- Learning and Growth: Complete the customers/market section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
- Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.
- Financial: Complete the financial section of the balanced scorecard template, identifying two of the most relevant key performance indicators.
Include APA 7 style citations to support.
Balanced Scorecard-Company A
| BASIC BALANCED SCORECARD TEMPLATE | 3 | |||||||||||||||||||||||||||||||||||||||||||||
| COMPANY NAME | ||||||||||||||||||||||||||||||||||||||||||||||
| ADDRESS | [Insert text | CITY | STATE | ZIP | ||||||||||||||||||||||||||||||||||||||||||
| Category | STRATEGIC OBJECTIVES | KEY PERFORMANCE INDICATORS | TARGET VALUES | KPI ACTION PLAN DETAILS | STUDENTS KPI SELECTION RATIONALE | |||||||||||||||||||||||||||||||||||||||||
| YEAR 1 | YEAR 2 | YEAR 3 | EXAMPLES OF PROGRAMS/INITIATIVES | BUDGETS | SELECTION RATIONALE | CAUSE-EFFECT RELATIONSHIP | ||||||||||||||||||||||||||||||||||||||||
| FINANCIAL | Provide examples of supporting programs or initiatives in this column | Provide budget allocations for the supporting programs or initiatives in ths column | Share your rationale behind your prioritization of the KPIs in this column | Identify the main cause-effect relationships between your chosen KPIs in this column | ||||||||||||||||||||||||||||||||||||||||||
| INTERNAL PROCESSES | ||||||||||||||||||||||||||||||||||||||||||||||
| CUSTOMER/MARKET | ||||||||||||||||||||||||||||||||||||||||||||||
| LEARNING AND GROWTH | ||||||||||||||||||||||||||||||||||||||||||||||
Balanced Scorecard-Company B
| BASIC BALANCED SCORECARD TEMPLATE | 3 | |||||||||||||||||||||||||||||||||||||||||||||
| COMPANY NAME | ||||||||||||||||||||||||||||||||||||||||||||||
| ADDRESS | [Insert text | CITY | STATE | ZIP | ||||||||||||||||||||||||||||||||||||||||||
| Category | STRATEGIC OBJECTIVES | KEY PERFORMANCE INDICATORS | KPI TARGET VALUES | KPI ACTION PLAN DETAILS | STUDENTS KPI SELECTION RATIONALE | Category | ||||||||||||||||||||||||||||||||||||||||
| YEAR 1 | YEAR 2 | YEAR 3 | EXAMPLES OF PROGRAMS/INITIATIVES | BUDGETS | SELECTION RATIONALE | CAUSE-EFFECT RELATIONSHIP | ||||||||||||||||||||||||||||||||||||||||
| FINANCIAL | Provide examples of supporting programs or initiatives in this column | Provide budget allocations for the supporting programs or initiatives in ths column | Share your rationale behind your prioritization of the KPIs in this column | Identify the main cause-effect relationships between your chosen KPIs in this column | FINANCIAL | |||||||||||||||||||||||||||||||||||||||||
| INTERNAL PROCESSES | INTERNAL PROCESSES | |||||||||||||||||||||||||||||||||||||||||||||
| CUSTOMER/MARKET | CUSTOMER/MARKET | |||||||||||||||||||||||||||||||||||||||||||||
| LEARNING AND GROWTH | LEARNING AND GROWTH | |||||||||||||||||||||||||||||||||||||||||||||
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COMPANY B Three-Year Data
| B_CO_FINANCE | Learner Copy | Rev 3/14/21 | |||
| COMPANY B | |||||
| Illlustrative Data for Educational Purposes | |||||
| All values shown are in thousands. | |||||
| 2017 | 2018 | 2019 | |||
| Income Statement | |||||
| Revenue | 27,981 | 26,302 | 27,091 | ||
| Cost of Goods Sold (COGS) | 15,389 | 18,411 | 18,151 | ||
| Gross Profit | 12,591 | 7,891 | 8,940 | ||
| Expenses | |||||
| Salaries and Benefits | 2,910 | 2,600 | 2,910 | ||
| Rent and Overhead | 1,354 | 1,354 | 1,354 | ||
| Depreciation and Amortization | 2,814 | 2,806 | 2,776 | ||
| Interest | 2,700 | 1,800 | 1,800 | ||
| Total Expenses | 9,778 | 8,560 | 8,840 | ||
| Earnings Before Tax | 2,813 | (669) | 100 | ||
| Taxes | 788 | (141) | 21 | ||
| Net Earnings | 2,025 | (529) | 79 | ||
| 2017 | 2018 | 2019 | |||
| Balance Sheet | |||||
| Assets | |||||
| Cash | 82,445 | 82,914 | 72,944 | ||
| Accounts Receivable | 1,380 | 1,297 | 1,336 | ||
| Inventory | 3,078 | 2,018 | 1,989 | ||
| Property and Equipment | 37,413 | 37,007 | 37,032 | ||
| Total Assets | 124,316 | 123,236 | 113,301 | ||
| Liabilities | |||||
| Accounts Payable | 1,560 | 1,009 | 995 | ||
| Debt | 90,000 | 90,000 | 80,000 | ||
| Total Liabilities | 91,560 | 91,009 | 80,995 | ||
| Shareholders' Equity | |||||
| Equity Capital | 33,685 | 33,685 | 33,685 | ||
| Retained Earnings | (929) | (1,458) | (1,379) | ||
| Shareholders' Equity | 32,756 | 32,227 | 32,306 | ||
| Total Liabilities and Shareholders' Equity | 124,316 | 123,236 | 113,301 | ||
| 2017 | 2018 | 2019 | |||
| Cash Flow Statement | |||||
| Operating Cash Flow | |||||
| Net Earnings | 2,025 | (529) | 79 | ||
| Plus: Depreciation and Amortization | 2,814 | 2,806 | 2,776 | ||
| Less: Changes in Working Capital | (10,312) | (592) | 25 | ||
| Cash from Operations | 15,151 | 2,869 | 2,830 | ||
| Investing Cash Flow | |||||
| Investments in Property and Equipment | (2,706) | (2,400) | (2,800) | ||
| Cash from Investing | (2,706) | (2,400) | (2,800) | ||
| Financing Cash Flow | |||||
| Issuance (repayment) of Debt | – | – | (10,000) | ||
| Issuance (repayment) of Equity | – | – | – | ||
| Cash from Financing | – | – | (10,000) | ||
| Net Increase (decrease) in Cash | 12,445 | 469 | (9,970) | ||
| Opening Cash Balance | 70,000 | 82,445 | 82,914 | ||
| Closing Cash Balance | 82,445 | 82,914 | 72,944 | ||
| Supporting Schedules | |||||
| Working Capital Schedule | |||||
| Accounts Receivable | 1,380 | 1,297 | 1,336 | ||
| Inventory | 3,078 | 2,018 | 1,989 | ||
| Accounts Payable | 1,560 | 1,009 | 995 | ||
| Net Working Capital (NWC) | 2,898 | 2,306 | 2,331 | ||
| Change in NWC | (10,312) | (592) | 25 | ||
| Depreciation Schedule | |||||
| PPE Opening | 37,521 | 37,413 | 37,007 | ||
| Plus Capex | 2,706 | 2,400 | 2,800 | ||
| Less Depreciation | 2,814 | 2,806 | 2,776 | ||
| PPE Closing | 37,413 | 37,007 | 37,032 | ||
| Debt and Interest Schedule | |||||
| Debt Opening | 90,000 | 90,000 | 90,000 | ||
| Issuance (repayment) | – | – | (10,000) | ||
| Debt Closing | 90,000 | 90,000 | 80,000 | ||
| Interest Expense | 2,700 | 1,800 | 1,800 | ||
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COMPANY A Three-Year Data
| A_CO_FIN | Learner Copy | Rev 6/19/21 | ||||
| COMPANY A |
