Question 1

Inflation clouds the real economic returns on an asset and ________.

Accepted Answer

A) makes variable-cost-based ROI higher 
B) makes historical-cost-based ROI lower. 
C) makes historical-cost-based ROI higher 
D) makes variable-cost-based ROI lower 
A) makes variable-cost-based ROI higher 
B) makes historical-cost-based ROI lower. 
C) makes historical-cost-based ROI higher 
D) makes variable-cost-based ROI lower

Question 2

Which of the following describes boundary control systems?

Accepted Answer

A) set limits by instituting and communicating standards of behavior and codes of conduct expected of all employees 
B) articulate the mission,purpose,and core values of a company 
C) are formal information systems managers use to focus the company's attention and learning on key strategic issues 
D) describe the geographic limits of a company and help organize its layout 
A) set limits by instituting and communicating standards of behavior and codes of conduct expected of all employees 
B) articulate the mission,purpose,and core values of a company 
C) are formal information systems managers use to focus the company's attention and learning on key strategic issues 
D) describe the geographic limits of a company and help organize its layout

Question 3

Which of the following is a performance measure?

Accepted Answer

A) retained earnings 
B) market value 
C) present value of cash flows 
D) economic value added 
A) retained earnings 
B) market value 
C) present value of cash flows 
D) economic value added

Question 4

Many manufacturing,marketing,and design problems require employees with multiple skills;therefore,teams are used and the members have the added encouragement of ________.

Accepted Answer

A) individual incentives 
B) management incentives 
C) morale incentives 
D) team incentives 
A) individual incentives 
B) management incentives 
C) morale incentives 
D) team incentives

Question 5

Economic value added,unlike residual income,charges managers for the costs of their investments in long-term assets and working capital.

Accepted Answer

A) True 
 B)False

Question 6

In performance evaluations ________.

Accepted Answer

A) managers should use the swap exchange rate prevailing at the end of a financial period 
B) managers should use the average exchange rate prevailing at the end of a financial period 
C) managers should use the exchange rate prevailing on the date the assets were acquired 
D) managers should use the exchange rate prevailing at the end of a financial period 
A) managers should use the swap exchange rate prevailing at the end of a financial period 
B) managers should use the average exchange rate prevailing at the end of a financial period 
C) managers should use the exchange rate prevailing on the date the assets were acquired 
D) managers should use the exchange rate prevailing at the end of a financial period

Question 7

Some companies present financial and nonfinancial performance measures for various organization units in a single report called the balanced scorecard.

Accepted Answer

A) True 
 B)False

Question 8

Bouvous Corp has two regional offices.The data for each are as follows:
 
What is the return on investment for the New Jersey Division?

Accepted Answer

A) 6)3% 
B) 25.5% 
C) 41.4% 
D) 19.2% 
A) 6)3% 
B) 25.5% 
C) 41.4% 
D) 19.2%

Question 9

The salary component of compensation dominates when performance measures that are sensitive to managers' actions are not available.

Accepted Answer

A) True 
 B)False

Question 10

Craylon Corp has three divisions,which operate autonomously.Their results for 2015 were as follows:
   
The company's desired rate of return is 15%.
Required:
a.Compute each division's ROI.Round to three decimal places.
b.Compute each division's residual income.

Accepted Answer

@#IMG-DLM&_TB5540_00

Question 11

Measures which monitor critical performance variables that help managers track progress toward achieving a company's strategic goals are collectively called diagnostic control systems.

Accepted Answer

A) True 
 B)False

Question 12

Total assets employed includes all assets,regardless of their intended purpose.

Accepted Answer

A) True 
 B)False

Question 13

When designing the steps in accounting-based performance measures,should the decisions in these steps be sequential?

Accepted Answer

Features - The decisions made in these s

Question 14

Return on investment can be increased by ________.

Accepted Answer

A) increasing current assets 
B) increasing return on sales 
C) decreasing revenues 
D) increasing the debt portion of the capital 
A) increasing current assets 
B) increasing return on sales 
C) decreasing revenues 
D) increasing the debt portion of the capital

Question 15

Many common performance measures,such as customer satisfaction,rely on internal financial accounting information.

Accepted Answer

A) True 
 B)False

Question 16

Springfield Corporation,whose tax rate is 34%,has two sources of funds: long-term debt with a market value of $6,000,000 and an interest rate of 9%,and equity capital with a market value of $16,000,000 and a cost of equity of 14%.What is Springfield's weighted average cost of capital (WACC)?

Accepted Answer

A) 14.00% 
B) 9)97% 
C) 11.80% 
D) 12.64% 
A) 14.00% 
B) 9)97% 
C) 11.80% 
D) 12.64%

Question 17

Higher inflation will lead to higher prices for goods or services,which will increase a company's operating income and lead to a higher ROI.

Accepted Answer

A) True 
 B)False

Question 18

The net present value of all cash flows over the life of an investment equals the net present value of the operating incomes.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is true about designing an accounting-based performance measure?

Accepted Answer

A) The decisions made in steps are followed in a hierarchial order. 
B) The issues considered in each step are independent. 
C) Management's beliefs are not required during the analyses. 
D) Behavioral criteria are important when evaluating the steps. 
A) The decisions made in steps are followed in a hierarchial order. 
B) The issues considered in each step are independent. 
C) Management's beliefs are not required during the analyses. 
D) Behavioral criteria are important when evaluating the steps.

Question 20

The first step in designing accounting based performance measures is to choose a target level of performance and feedback mechanism.

Accepted Answer

A) True 
 B)False

Exam 23: Performance Measurement, compensation, and Multinational Considerations

Inflation clouds the real economic returns on an asset and ________.

Which of the following describes boundary control systems?

Which of the following is a performance measure?

Many manufacturing,marketing,and design problems require employees with multiple skills;therefore,teams are used and the members have the added encouragement of ________.

Economic value added,unlike residual income,charges managers for the costs of their investments in long-term assets and working capital.

In performance evaluations ________.

Some companies present financial and nonfinancial performance measures for various organization units in a single report called the balanced scorecard.

Bouvous Corp has two regional offices.The data for each are as follows: What is the return on investment for the New Jersey Division?

The salary component of compensation dominates when performance measures that are sensitive to managers' actions are not available.

Craylon Corp has three divisions,which operate autonomously.Their results for 2015 were as follows: The company's desired rate of return is 15%. Required: a.Compute each division's ROI.Round to three decimal places. b.Compute each division's residual income.

Measures which monitor critical performance variables that help managers track progress toward achieving a company's strategic goals are collectively called diagnostic control systems.

Total assets employed includes all assets,regardless of their intended purpose.

When designing the steps in accounting-based performance measures,should the decisions in these steps be sequential?

Return on investment can be increased by ________.

Many common performance measures,such as customer satisfaction,rely on internal financial accounting information.

Springfield Corporation,whose tax rate is 34%,has two sources of funds: long-term debt with a market value of $6,000,000 and an interest rate of 9%,and equity capital with a market value of $16,000,000 and a cost of equity of 14%.What is Springfield's weighted average cost of capital (WACC)?

Higher inflation will lead to higher prices for goods or services,which will increase a company's operating income and lead to a higher ROI.

The net present value of all cash flows over the life of an investment equals the net present value of the operating incomes.

Which of the following is true about designing an accounting-based performance measure?

The first step in designing accounting based performance measures is to choose a target level of performance and feedback mechanism.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets,direct-Cost Variances,and Management Control

Flexible Budgets, overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy,balanced Scorecard,and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, just-In-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, transfer Pricing, and Multinational Considerations

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