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1. A bonus plan differs from a salary in terms of:
2. Of the three basic forms of management compensation (salary, bonus, benefits), the
fastest growing part of total compensation is:
3. As a firm's strategy changes to respond to different stages of a product's life cycle,
compensation:
4. Risk aversion by managers should be recognized when revising compensation plans
because:
5. Rules recently established by the Securities and Exchange Commission include a "say on
pay" rule that requires:
6. Any system of compensation:
7. The objectives of management compensation, when compared to the objectives used to
develop performance measurement systems, are:
8. In developing compensation plans, the management accountant works to achieve
fairness by making the plan:
9. Bases for management bonus compensation often include:
10. When strategic performance measures or critical success factors are used to determine
bonus compensation, the bonus will usually depend either on the amount of improvement in the
measure or on:
11. Bonus plans should be tied to variable cost income, which it is less subject to
manipulation because is not affected by inventory level changes, rather than the conventional:
12. The balanced scorecard critical success factors (CSFs) provide strong motivation in
bonus compensation plans if the noncontrollable factors are:
13. If fairness only is considered, if a unit manager's unit is doing well, the unit manager
prefers:
14. Generally, the current and deferred types of bonus payment options currently in use tend
to focus the manager's attention on short-term performance measures, most commonly:
15. The stock option form of bonus payments to managers usually:
16. The ideal compensation plan would make all company contributions to the plan
immediately tax-deductible and all tax consequences for managers:
17. In management compensation, the use of the balanced scorecard achieves:
18. The balanced scorecard evaluation of the firm is an especially strong financial tool
because of its:
19. The receivables turnover ratio is a measure of:
20. Market value of equity is an objective measure which clearly shows what:
21. The price-earnings ratio for firms in the Standard & Poor's 500 Index has averaged _____
over the last 50 years.
22. The discounted cash flow (DCF) method of valuation uses the discounted present value
of cash flow so it is not subject to the bias of different:
23. If an earnings multiplier is not available for a given firm, the multiplier used in an
earnings-based method of valuation of a firm is often estimated from comparable:
24. Which one of the following items is not a measure of a company's liquidity?
25. Which one of the following forms of compensation is a based upon the achievement of
performance goals for a period?
26. Which one of the following forms of compensation includes special services and benefits
for the employee?
27. A method for determining a bonus based upon the performance of the unit is a(n):
28. A method for determining a bonus based upon the performance of the firm is a(n):
29. All of the following are common payment options for bonus compensation plans except:
30. The profit multiplier used by service firms measures:
31. The method for directly measuring the value of a firm's equity is:
32. Which one of the following refers to the firm's ability to pay its current operating
expenses and maturing debt?
33. Which one of the following develops the value of the firm as the present value of the
firm's net free cash flows?
34. A deferred bonus can consist of:
35. Which one of the following computes value based on recent annual earnings?
36. Jackson Supply Company has a 2 to 1 current ratio. This ratio would increase to more
than 2 to 1 if the company:
37. Fringe benefits include all of the following except:
38. A current bonus can consist of:
39. In service firms, improvement in long term profitability is best measured by all of the
following except:
