MGMT 300 - EXAM ch 19

Kieler prepares a financial statement that indicates the "bottom line" for the company. Which of the following has Kieler provided?

Income statement

In reviewing the budget, Drew discovers that actual revenues are significantly below what was budgeted for the quarter. Which of the following is his next step?

Investigate the problem to see whether the organization can improve revenues.

Which of the following is NOT a benefit of open-book management?

It provides numerous rules and policies to guide employees' activities and actions.

Which of the following are the four types of common financial ratios?

Leverage, profitability, liquidity, and activity

Which of the following statements about leverage ratios is true?

Managers track their debt ratio to make sure it does not exceed a level that they consider acceptable.

Which of the following statements about ISO 9000 standards is true?

Many countries and companies require ISO certification before they will do business with an organization.

Six Sigma quality principles provide a highly ambitious quality goal. Which of the following is the specific goal of Six Sigma?

No more than 3.4 defects per million parts

Managers analyze a company's profits by studying profitability ratios. Chayton has been asked to analyze profit relative to assets. Which of the following ratios would Chayton use?

Return on assets

Which of the following actions is part of the first step in the feedback control model, establishing standards?

Setting the number of products to be produced each day

Joey receives a production report for the month. While reviewing the report, he finds that quality control metrics show lower product quality than acceptable. He talks to workers involved in the production process to find out what they believe the problem to be. The workers show him that quality is not the issue, but the standard against which it is measured is inappropriate for the process. As a result, Joey revises the standard against which quality is measured. Deciding to change the standard is which of the following control model steps?

Step 4. Take corrective action

To carry out the control function in a decentralized control system, Morgan would most likely be involved in which of the following actions?

Taking initiative

Which of the following contingency factors can influence the success of a TQM program?

Tasks make great skill demands on employees. Workers are dissatisfied with other aspects of organizational life. Management expectations are unrealistically high. (All of these answers are correct )

Which of the following statements about the use of the balanced scorecard in organizational control is true?

The balanced scorecard balances traditional financial measures with operational measures relating to a company's critical success factors.

In order to increase the likelihood that a total quality management program will be successful in a given company, which of the following needs to be true?

The corporate culture values quality and stresses continuous improvement

In reviewing the expense budget for the past several months, Finley notices that in several categories, expenses were far below what had been budgeted for them. Which of the following explains this discrepancy?

The desired level of quality and customer service is not being met

Which of the following statements about control in the organizational setting is NOT true?

The essence of control is action that changes predetermined standards to actual operations metrics

Before a manager uses the four steps of the control process, which of the following must already be in place?

The organization's strategic goals

_____ is an organization-wide effort to infuse quality into every activity in a company through continuous improvement.

Total quality management

The _____ shows the firm's financial position with respect to assets and liabilities at a specific point in time

balance sheet

Karter and Avery have introduced their employees to a total quality management approach called Kaizen to implement a large number of small, incremental improvements in all areas of the organization on an ongoing basis. Kaizen is also known as:

continuous improvement

Tanner strongly believes in employee participation and empowerment and has shifted to a _____ rather than a _____ control process.

decentralized; hierarchical

The goal of open-book management is to:

get every employee thinking and acting like a business owner.

In preparing an income statement, you would begin with _____, subtract _____ and other items, and end up with _____.

gross sales; expenses; net income

Kelley's organization has installed a thumb-recognition clock-in device for employees. Although it has reduced the incidence of employees clocking in for coworkers who are running late, employee reactions have been negative. This type of electronic monitoring tends to:

increase hierarchical control.

The central factor for effective organizational control is:

information.

The balanced scorecard is an effective tool for managing and improving performance, but only if:

it is clearly linked to well-defined organizational strategy and goals.

In financial analysis, the quick ratio is a popular metric to pair with the current ratio to gauge:

liquidity.

At ATZ Technologies, managers use a hierarchical control system. This type of system has all of the following characteristics EXCEPT:

managers rely on shared goals and values to control employee behavior.

Carson listed each employee's daily sales results and whether goals, which were also listed, were met. Through _____, Carson helped employees see how their efforts affected the financial success of the company.

open-book management

The systematic process of regulating organizational activities to make them consistent with the expectations established in plans, targets, and standards of performance is known as

organizational control

If managers implement the balanced scorecard using a _____ orientation rather than a _____ approach that links targets and measurements to corporate strategy, use of the scorecard can actually hinder or even decrease organizational performance.

performance measurement; performance management

Another name for an income statement is:

profit-and-loss statement.

The purpose of measuring actual performance is to:

provide data for review against standards

Within the four areas of the balanced scorecard, managers identify the _____ to perform the control function for the organization

targets, measures, outcomes, and corrections

Budgets that managers typically use include all of the following EXCEPT:

virtual budgets.

In _____, planning and decision making require a complete justification for every line item in a budget instead of carrying forward a prior budget and applying a percentage change.

zero-based budgeting

Many countries have adopted a universal benchmark for quality management practices called the ISO 9000 standards. Which of the following explains what these standards represent?

An international consensus of what constitutes effective quality management

Which of the following three types of information are found on the balance sheet?

Assets, liabilities, and owners' equity

Which of the following is unlikely to be found among the standards a company might use in a feedback control model?

Average age of workers

The company's bank account stands at $25,000. Expenses for payroll, utilities, rent, and suppliers total $40,000. Because expenses have exceeded the company's available cash, what is the company's next step?

Borrow cash to meet its obligations.

Which of the following statements about budgets is NOT true?

Budget reports seldom include the variance between the budgeted and actual amounts for each item.

Open-book management is an important aspect of _____ control.

-Decentralized

Which of the following is NOT among the four steps of the feedback control model?

-Set the organization's strategic goals

A survey from the American Management Association found that _____ of employers monitor the Internet use of their employees, track employee keystrokes, and monitor employee e-mail.

43-66 percent

Which of the following appears on the Liabilities and Owners' Equity side of the balance sheet?

Common stock

Which of the following statements about interpreting the numbers in a financial analysis is true?

Comparisons of financial information enable the manager to see whether the organization is improving and competitive with others in the industry.

_____ relies on cultural values, traditions, shared beliefs, and trust to foster compliance with organizational goals.

Decentralized control

On the balanced scorecard, the key performance metrics for internal business processes help managers answer which of the following questions?

Do activities add value for customers and shareholders?

With decentralized control, which of the following is true?

Everyone is involved in quality control on an ongoing basis

_____ involves monitoring and influencing employee behavior through extensive use of rules, policies, reward systems, and other formal mechanisms.

Hierarchical control

What is the balanced scorecard?

A comprehensive management control system

Which of the following two major financial statements provide the starting points for financial control?

Balance sheet and income statement

At the end of each month, department managers send reports that contain specific measurements and metrics that show progress toward organizational goals to the chief operating officer (COO). The COO looks at these reports, compares what they say to standards, and decides what changes need to be made to move the actual closer to the planned figures. With this process, the COO is engaging in the _____ function of management.

Controlling

A balanced scorecard contains which of the following four major perspectives?

Financial performance, customer service, internal business processes, and the organization's capacity for learning and growth

The implementation of TQM involves the use of numerous techniques. Which of the following is NOT included among TQM techniques?

Locus of control

Which of the following statements regarding a hierarchical versus a decentralized approach to the control process is true?

With decentralized control, the culture is adaptive, and managers recognize the importance of organizational culture for uniting individual, team, and organizational goals.

Which of the following statements about open-book management is true?

With training in interpreting financial data, employees can see the interdependence and importance of each function.

Sean is part of a volunteer group of eight employees who meet regularly to discuss and solve problems that affect the quality of their work. This type of TQM is known as:

a quality circle.

In the collegiate division of the clothing production department, the manager, Quinn, prepares a budget based on the needs she is anticipating for the coming period. The budget is forwarded to upper management for approval. The company is using:

bottom-up budgeting.

Setting targets for an organization's expenditures, monitoring results and comparing them to the established targets, and making changes as needed are the activities of:

budgetary control.

When Jordan estimates receipts and expenditures of money on a daily or weekly basis to ensure that an organization has sufficient cash to meet its obligations, Jordan is preparing the:

cash budget.

Kelsey is part of a team that has been tasked with a benchmarking study for their organization. After they have planned the study and identified the source of the information to be collected, their next step would be to:

collect the data

Benchmarking can be defined as any of the following EXCEPT

encouraging all employees to think and act like business owners.

Anticipated and actual expenses for each responsibility center and for the total organization can be found in a(n):

expense budget.

Merry Manufacturing is considering adopting a balanced scorecard approach to its control function. At present, Merry only uses the traditional financial measures of:

net income and return on investment.

The five steps of the benchmarking process, in order, are

plan, find, collect, analyze, and improve.

The total quality management philosophy focuses on all of the following EXCEPT:

process rules and policies

Joey receives a production report for the month. While reviewing the report, he finds that quality control metrics show product quality to be at the high end of the acceptable range. In this case, step 4 will consist of

providing reinforcement to workers to encourage current performance levels

A primary reason for using quality circles is to:

push decision making to an organization level at which recommendations can be made by the people who do the job and know it better than anyone else

In the approach called _____, quality control personnel work alongside others within a functional area to identify opportunities for quality improvements throughout the work process.

quality partnering

The most common way that organizations measure and control performance is through the use of:

quantitative financial measures.

Ellis has authority for preparing budgets and overseeing the activity of the purchasing department. In this scenario, the purchasing department is a:

responsibility center.

Forecasted and actual sales and other income of an organization can be found within the

revenue budget.

Joey receives a production report for the month. While reviewing the report, he finds that quality control metrics show lower product quality than acceptable. He talks to workers involved in the production process and finds out that they believe the problem is one particular worker who hasn't quite mastered the process. As a result, Joey provides the worker with additional training. In taking corrective action, he has affected

step 2, by adjusting the performance factor.

The federal government has mandated that motor carrier companies digitally track the movement and location of their fleets as well as workers' hours. For this requirement, companies use technologies that can wirelessly transmit data from remote sensors and GPS devices to computers for analysis, or:

telematics.