54. In the process of implementing the balanced scorecard approach at his company, operations manager Seth Howard
wonders whether internal activities and processes add value for customers and shareholders. This involves which
dimension of the balanced scorecard?
a. Customers
b. Learning and growth
c. Financials
d. External business processes
e. Internal business processes
55. Focusing on how well resources and human capital are being managed for the company’s future refers to which
component of the balanced scorecard?
a. Customers
b. Learning and growth
c. Financials
d. Internal business processes
e. External business processes
56. Use of the balanced scorecard can hinder or decrease organizational performance if it is implemented using which
type of orientation?
a. Performance management orientation
b. Performance measurement orientation
c. Customer orientation
d. Learning and growth orientation
e. Internal business process orientation
57. All well-designed control systems involve the use of to determine whether performance meets established
standards.
a. opinions
b. advice
c. consultants
d. benchmarks
e. feedback
58. What is the first step in the feedback control system?
a. Establishing strategic objectives
b. Establishing standards of performance
c. Taking corrective action
d. Comparing performance to standard
e. Measuring previous performance
59. CyberChasers Corporation sends a post-purchase questionnaire to all consumers who buy their products. They are
interested in gathering data on product quality, customer service orientation, and customer satisfaction. This is an
example of a:
a. concurrent control.
b. feedback control.
c. feedforward control.
d. preliminary control.
e. preventive control.
60. Kendra is a manager at George’s Goodies. On a regular basis Kendra and her subordinates set individual and
organizational goals. This process is similar to which component of the control model?
a. Taking corrective action when necessary
b. An information system
c. Establishing performance standards
d. Engaging strategic analysis
e. None of these
61. According to the control model, after establishing standards of performance the manager should:
a. compare performance to standards.
b. get the standards approved by the supervisors and subordinates.
c. measure actual performance.
d. take corrective action.
e. provide feedback.
62. control is the process of setting targets for an organizations expenditures.
a. Quality
b. Income
c. Budgetary
d. Systems
e. Supply chain
63. Which of the following includes anticipated and actual expenses for a responsibility center?
a. Revenue budget
b. Cash budget
c. Capital budget
d. Expense budget
e. Operating budget
64. Which of these is a financial budget that estimates cash flows on a daily basis or weekly basis to ensure that the
company can meet its obligations?
a. Capital expenditure budget
b. Balance sheet budget
c. Cash budget
d. Revenue budget
e. Profit budget
65. Madison has been assigned to work on the development of a budget that plans future investments in major assets
such as buildings and heavy machinery. Madison is working on a(n) budget.
a. cash
b. capital
c. revenue
d. operating
e. expense
66. The plans future investments in major assets to be depreciated over several years.
a. capital budget
b. balance sheet budget
c. cash budget
d. revenue budget
e. profit budget
67. Ron meets with his company’s accountant to discuss the budget of anticipated and actual expenses for each
segment of the organization. This involves review of which type of budget?
a. Expense budget
b. Revenue budget
c. Cash budget
d. Capital budget
e. Nonfinancial budget
68. Stella, a systems manager for a large technology company, would like to get an understanding of her company’s
financial position with respect to assets and liabilities at the end of the fiscal year. Which financial statement should
she refer to?
a. Income statement
b. Activity ratio
c. TQM report
d. Balance sheet
e. Balance scorecard
69. Brad is a department manager at Home Theater, Inc. His sole role in the budget process is to implement the budget
that is developed for him. This is an example of:
a. strategic budgeting.
b. operational budgeting.
c. top–down budgeting.
d. management by objectives.
e. bottom-up budgeting.
70. Pauline is an area manager at Ironman Gym. She anticipates her area’s needs and formulates a proposed budget
every quarter. She then sends this proposal to her manager. This is an example of:
a. top–down budgeting.
b. strategic budgeting.
c. revenue budgeting.
d. bottom-up budgeting.
e. none of these.
71. An advantage of the bottom-up budgeting process is:
a. its emphasis on bureaucratic control.
b. lower managers are more involved.
c. top managers control the information flow.
d. top managers are often not committed to achieving budget targets.
e. all of these.
72. The firm’s financial position with respect to assets and liabilities at a specific point in time is shown by its:
a. activity ratio.
b. profitability ratio.
c. income statement.
d. liquidity ratio.
e. balance sheet.
73. provide the basic information used for financial control of an organization.
a. Owners equity
b. Income statements
c. Financial position
d. Mission Statements
e. 100-K‘s
74. refer(s) to the difference between assets and liabilities and is the company’s net worth in stock and retained
earnings.
a. Assets
b. Current debt
c. Net profit
d. Owners‘ equity
e. Liabilities
75. The ratio refers to the ability of the organization to meet its current debt obligation.
a. activity
b. liquidity
c. profitability
d. conversion
e. growth
76. The conversion ratio is considered to be a(n) ratio.
a. activity
b. liquidity
c. profitability
d. leverage
e. cash
77. Which of the following is a ratio that measures the firm’s internal performance with respect to key activities defined
by management?
a. A liquidity ratio
b. An activity ratio
c. Return on total assets
d. A current ratio
e. Profit margin on sales
78. The is purchase orders divided by customer inquiries.
a. current ratio
b. inventory turnover ratio
c. conversion ratio
d. profit margin on sales
e. none of these
79. Tammy is a production manager at Eagle‘s Nest, Inc.. She is concerned that too much money is being wasted on
inventory that is sitting in the warehouse too long. She should calculate a(n):
a. current ratio.
b. inventory turnover ratio.
c. conversion ratio.
d. profitability ratio.
e. leverage ratio.
80. Net income divided by sales is the correct formula for calculating:
a. return on total assets.
b. a current ratio.
c. a liquidity ratio.
d. profit margin on sales.
e. a corporate evaluation.
81. Which of the following refers to funding activities with borrowed money?
a. ROA
b. Leverage
c. Liquidity
d. Profitability
e. Activity
82. Which of the following is considered a leverage ratio?
a. Debt ratio
b. Return on total assets
c. Profit margin on sales
d. Conversion ratio
e. Inventory turnover
83. The basic philosophy of control at Nutrients-For-You, Inc. is based on the policies found in the employee handbook,
as well as a strict hierarchy of authority. This philosophy is consistent with:
a. clan control.
b. bottom-up control.
c. hierarchical control.
d. culture control.
e. decentralized control.
84. At LBK Industries, responsibility for quality control rests with a team of quality control inspectors and supervisors
rather than with employees. LBK uses what type of organizational control?
a. Matrix control
b. Hierarchical control
c. Decentralized control
d. Bottom-up control
e. Balanced control
85. Decentralized control is usually implemented in all of the following areas EXCEPT:
a. self-control.
b. peer group.
c. corporate culture.
d. employee selection and socialization.
e. the quality control department.
86. At RWI Distilleries, rules and procedures are used only when necessary. Instead, shared goals and values guide
employee behavior. RWI uses what type of organizational control?
a. Centralized control
b. Hierarchical control
c. Decentralized control
d. Top–down control
e. Balanced control
87. Which of the following allows employees to see for themselves the financial condition of the company?
a. Open-book management
b. An economic value-added system
c. Activity-based costing
d. An inappropriate control system
e. Market value-added system
88. The control “system” at FreshFood Corporation is based on the culture of the organization and norms that develop in
the individual work teams. This is an example of:
a. bureaucratic control.
b. decentralized control.
c. organizational control.
d. feedback control.
e. none of these.
89. The goal of is to get every employee thinking and acting like a business owner.
a. management–by–walking around
b. closed–book management
c. MBO
d. open-book management
e. just-in–time inventory systems
90. Silver n’ Gold Inc. recently introduced a new control philosophy where all employees have access to the same
information that owners have, such as what money is coming in and where it is going. This is an example of which
control philosophy?
a. Balanced scorecard
b. Six Sigma
c. Continuous improvement
d. Total quality management
e. Open-book management
91. Total quality management:
a. is based on the ideas of Frederick Taylor.
b. gives managers total responsibility for achieving quality goals.
c. gives all employees the responsibility for achieving quality goals.
d. was first successfully implemented in the United States.
e. is all of these.
92. Which of the following is a philosophy of organization-wide commitment to continuous improvement, focusing on
teamwork, customer satisfaction, and lowering costs?
a. Engineering
b. Total quality management
c. Outsourcing
d. Culture
e. Diversity
93. Charlie, a manager at a textile company, is bothered by a lack in quality of products manufactured by his company.
Charlie hopes to infuse quality into the company through continuous improvement by involving everyone who works
there. This describes which control philosophy?
a. Balanced scorecard
b. Six Sigma
c. Continuous improvement
d. Total quality management
e. Open-book management