Q1: What does it mean if an employees remuneration package includes an incentive compensation plan ?

a.) At least some portion of income is not guaranteed

b.) Salary is the main component of compensation

c.) None of the above

Q2: Which of the following statements is correct?

a.) A flexible budget is prepared for one level of activity only and results in improved performance evaluations.

b.) A flexible budget is prepared for different levels of activity within a firms relevant range and results in improved performance evaluations.

c.) A flexible budget is prepared for one level of activity only and does not result in improved performance evaluations.

Q3: What is an outlier?

a.) An outlier is a data point that falls far away from the other points in the scatter diagram and is not representative of the data.

b.) An outlier is a data point that does not fall away from the other points in the scatter diagram and is representative of the data.

c.) None of the above.

Q4: . Which of the following statements is correct?

a.) Measures of quality should not reflect customers evaluation of product and service quality

b.) Measures of quality should not provide signals about any deterioration in product or service quality

c.) Measures of quality should indicate customers evaluations of product and service quality

d.) None of the above

Q5:. The balanced scorecard is a set of discrete yet linked measures of business performance that provide managers with comprehensive and timely information. Which of the following statements correctly describes the measures included in the balanced scorecard?

a.) Include financial measures only

b.) Combines financial with non-financial measures

c.) Includes long-term measures

d.) Include internal measures only

Q6: What should the transfer price be if there is excess capacity ?

a.) Fixed cost

b.) Market price

c.) Sunk Cost

d.) Variable cost

Q7 : The Motor division of Zenx Inc. Produces motors that can be widely used by manufacturers of various appliances. Sales and cost data on the motors are as follows:

Assume that the Motor division is selling only 110,000 motors per year to outside customers. From the standpoint of the Motor division, what is the lowest acceptable transfer price for motors sold to the Appliance division?

Selling price per unit on the market 340 268 Variable costs per unit Fixed costs (based on capacity) Annual production capacity in units 42 120,000 The Appliance division of Zenx Inc. can use the motors in the production of one of its products. The Appliance division will need 10,000 motors per year. It has received a quote of 328 per motor from another manufacturer. Managers of Zenx Inc. are evaluated based on divisional profits