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Chapter Sixteen: Managerial Control

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Chapter Sixteen: Managerial Control

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  1. The company Doug and Todd are employed by has established a formal set of rules and regulations for employees to follow when conducting the duties of their work. The company feels these rules will serve to effectively guide the performance of each employee. This organization most likely engages in _____. • A. management myopia • B. feedback control • C. downward communication • D. feedforward control • E. bureaucratic control Chapter Sixteen: Managerial Control 16-1

  2. The process through which Sharon’s organization directs the employees into performance that proves beneficial to the organization as a whole is best referred to as _______. • A. control • B. clan control • C. return on investment • D. feedforward control • E. management audit Chapter Sixteen: Managerial Control 16-2

  3. Todd’s company bases many of its decisions on the results derived from using a pricing mechanism system that helps to regulate the activities of the various organizational departments. It can be stated Todd’s company most likely engages in a _________ system. • A. bureaucratic control • B. market control • C. clan control • D. management myopia • E. debt-equity ratio 16-3 Chapter Sixteen: Managerial Control

  4. Daniel’s company has many high performance expectations of its employees. It has established various target levels for individual workers to strive for and expects the employees to progress through the various levels quickly. Daniel’s company has set high performance _____ for its employees. • A. liability audits • B. controls • C. standards • D. ratios • E. budgeting Chapter Sixteen: Managerial Control 16-4

  5. At which step of the control cycle would an organization most likely be at if the organization realizes it has missed its expected goals and starts to improve upon what caused its inability to meet expected standards? • A. Step 3 • B. Step 5 • C. Step 2 • D. Step 6 • E. Step 4 Chapter Sixteen: Managerial Control 16-5

  6. Holly’s company has established a set of guidelines for the employees to follow when conducting work performance. These guidelines include rules, policies, and procedures that each worker is expected to adhere to when working. It can be stated this organization is most probably engaging in _____. • A. bureaucratic control • B. activity-based costing • C. clan control • D. management myopia • E. feedforward control Chapter Sixteen: Managerial Control 16-6

  7. Terry and Lucas are employed at the same company. The company engages a control system that examines and evaluates the results of past performance to help it determine what may prove effective for the future. It can be said this company is using a _____ control system. • A. feedback • B. concurrent • C. bureaucratic • D. feedforward • E. clan 16-7 Chapter Sixteen: Managerial Control

  8. Tim and Jim work for a company that uses quality control mechanisms that are designed to reduce defects in all of the organization’s processes. This quality control system is most likely to be called a _____ system. • A. current ratio • B. Six Sigma • C. concurrent control • D. principle of exception control • E. ROI Chapter Sixteen: Managerial Control 16-8

  9. Stan and Mark’s company periodically conducts reviews and assessments on the effectiveness of its plans and strategies. It closely examines the workings of the entire organization to see how well it is performing overall. It can be stated this company conducts ______. • A. external audits • B. budgeting audits • C. activity-based costing audits • D. internal audits • E. market control audits Chapter Sixteen: Managerial Control 16-9

  10. Which one of the following would least likely to be conducted during an organization’s external audit? • A. Study of a competitor’s strengths • B. Study of publicly available financial data of outside organizations • C. Examination of what the company has done for its customers • D. Exploration of the soundness of a potential supplier • E. Examination of a rival’s weaknesses Chapter Sixteen: Managerial Control 16-10

  11. Every quarter Adam’s company examines the expenses and sales of each of its various departments. It uses this information to determine that each department is meeting organizational expectations and to determine how much money must be allotted to each various department to ensure continued success. This company is most likely engaging in _______ with its actions. • A. budgeting • B. clan control • C. activity-based costing • D. accounting audit • E. management myopia Chapter Sixteen: Managerial Control 16-11

  12. The finance department of the “N2XS” Corporation is preparing its budget for the upcoming year. The auditors are currently discussing the number of physical units the company is likely to produce during the next 12 months. The auditors plan to look at the types and capacities of machines and the availability of necessary materials next. They are most likely preparing the _____ budget for the company. • A. sales • B. master • cash • production • E. cost Chapter Sixteen: Managerial Control 16-12

  13. The independent accounting firm of Goober and Goober have been selected to conduct the periodic review of the records of Gerald’s business. They will verify the accuracy of monetary reports and statements compiled by the company. It is safe to say they will be conducting a/an ______ of Gerald’s organization. • A. debt-equity ratio audit • B management audit • C. accounting audit • D. external audit • E. internal audit Chapter Sixteen: Managerial Control 16-13

  14. The “BCB Company” recently began using a system that allocates costs across all of its business practices. For this type of system to be successful, it needs accurate records of the amount of time the various department employees spend conducting particular activities. The company owner is not certain adequate records of this type of information have been maintained in-depth enough to use the new system of _______ effectively. • A. ROI • B. activity-based costing • C. concurrent control • D. bureaucratic control • E. feedforward control Chapter Sixteen: Managerial Control 16-14

  15. Sandra’s small business has considerable value in the items her company owns outright. These items are considered ______. Sadly though, Sandra’s company owes twice as much as she owns to her creditors. Her debts to the various creditors are called _______. • A. assets, liabilities • B. liabilities, assets • C. equity, liabilities • D. assets, equity • E. equity, assets 16-15 Chapter Sixteen: Managerial Control

  16. The owners of the “Send It Fast” company are very enthused about the company’s financial progress. Their auditors have told them they have each earned a considerable amount of revenue this year. This is indicative the ______ has grown. • A. asset account • B. stockholders’ equity • C. liabilities account • D. debt-equity ratio • E. return on investment Chapter Sixteen: Managerial Control 16-16

  17. The “XYZ Organization” had its accounting department prepare a formal statement to reflect the true financial picture of the organization’s operations. This type of statement is referred to as a _______________. • A. profit and loss statement • B. debt-equity ratio • C. balance sheet • D. activity-based costing statement • E. current ratio 16-17 Chapter Sixteen: Managerial Control

  18. The mangers of “Organization X” fail to consider the long-term strategic obligations of their business and instead maintain a focus only on the short-term profits to be obtained for the company. It can be stated the managers suffer from ______. • A. management myopia • B. principles of exception • C. concurrent control • D. ROI syndrome • E. debt-equity ratio analysis Chapter Sixteen: Managerial Control 16-18

  19. The employees of the “A Corporation” diligently try to conduct themselves in ways that will win approval from the corporate executives. This type of _____ behavior often results in the employees only doing exactly what the corporate system requires and nothing more. • A. tactical • B. resistance • C. myopic • D. rigid bureaucratic • E. boundaryless Chapter Sixteen: Managerial Control 16-19

  20. Of the following, which one would not be a consideration for Tammy’s company to have when it is designing its organizational control systems? • A. The system is based on valid performance standards • B. The system is acceptable to employees • C. The system recognizes the relationship between empowerment and control • D. The system effectively communicates adequate information to employees • E. The system engages a single approach Chapter Sixteen: Managerial Control 16-20

  21. 10-1. E 10-2. A 10-3. B 10-4. C 10-5. E 10-6. E 10-7. A 10-8. B 10-9. D 10-10. C 10-11. A 10-12. D 10-13. C 10-14. B 10-15. A 10-16. B 10-17. C 10-18. A 10-19. D 10-20. E Chapter Sixteen: Managerial Control Correct Responses to 20 Quiz Questions 16-21

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