Question 1

Which of the following managers is likely to have the most different responsibilities for a company?
A)the manager of a cost center
B)the manager of a profit center
C)the manager of an investment center
D)the manager of a revenue center

Accepted Answer

The manager of an investment center is likely to have the most different responsibilities for a company because they are responsible for both generating profits and managing investments. This involves making investing decisions, monitoring performance, and making adjustments as necessary to maximize earnings. In contrast, the manager of a cost center is primarily responsible for minimizing expenses, the manager of a profit center focuses on generating revenue, and the manager of a revenue center is responsible for generating sales.

Question 2

Which of the following internal business perspective key performance indicators (KPIs)is commonly used to assess the innovation process?
A)number of new products developed
B)number of warranty claims
C)employee turnover rate
D)rate of on-time deliveries

Accepted Answer

The number of new products developed is a common KPI used to assess the innovation process, as it measures the effectiveness of the organization's efforts in developing innovative new products. The other options (B, C, and D) are not directly related to innovation and are more focused on operations or HR management.

Question 3

Which of the following four perspectives of the balanced scorecard enables the management to answer the question,"How can we continue to improve and create value?"
A)financial perspective
B)customer perspective
C)internal business perspective
D)learning and growth perspective

Accepted Answer

The learning and growth perspective of the balanced scorecard focuses on the development of employee skills, technology, and organizational culture. By answering the question of "How can we continue to improve and create value?", this perspective enables management to identify areas where the organization can continually learn and grow, and implement strategies to do so.

Question 4

Which of the following is a responsibility that is common to the managers of cost,profit,and investment centers?
A)generating revenues
B)generating profits
C)managing the invested capital
D)controlling costs

Accepted Answer

Controlling costs is a common responsibility across managers of cost, profit, and investment centers. Each type of center has a focus on managing costs effectively to achieve their respective goals.

Question 5

Which of the following best describes the manager of a profit center?
A)The manager is only responsible for controlling costs.
B)The manager is responsible for generating profits and efficiently managing the center's invested capital.
C)The manager is only responsible for generating revenues.
D)The manager is responsible for generating revenues and controlling costs.

Accepted Answer

The manager of a profit center is responsible for both generating revenues and controlling costs to maximize the profit of the center. This involves making decisions that impact both income and expenses to ensure the profitability of the center.

Question 6

One part of the balanced scorecard helps management answer the question,"How do we look to shareholders?" Which of the four perspectives is being described here?
A)financial perspective
B)customer perspective
C)internal business perspective
D)learning and growth perspective

Accepted Answer

The financial perspective focuses on financial metrics such as revenue, profitability, and return on investment, which are important indicators for shareholders.

Question 7

Performance evaluation systems provide top management with a framework for maintaining control over the entire organization.

Accepted Answer

Performance evaluation systems provide a mechanism for setting goals, measuring progress, and making adjustments to ensure that the organization as a whole is meeting its objectives. This helps top management to maintain control and ensure that the organization is moving in the right direction.

Question 8

Qvoware Inc.sells cosmetic products in the United States.Which one of the following is most likely to be a revenue center for Qvoware?
A)a Qvoware retail store in Dallas
B)the Qvoware HR department
C)a Qvoware kiosk at a mall for selling its products
D)the Qvoware product lines

Accepted Answer

A kiosk at a mall for selling Qvoware products is most likely to be a revenue center for the company as it directly generates sales revenue by selling its products to customers. A retail store in Dallas can also be a revenue center, but a kiosk at a mall is more focused on selling Qvoware products only. The HR department and the product lines are not revenue centers as they do not directly generate sales revenue.

Question 9

Which of the following is most likely a key performance indicator of the internal business perspective of the balanced scorecard?
A)number of units produced per hour
B)employee turnover
C)cash flow
D)number of cross-trained employees

Accepted Answer

The internal business perspective of the balanced scorecard focuses on internal operational goals and the processes that influence customer satisfaction and financial objectives. "Number of units produced per hour" is a measure of operational efficiency, making it a key performance indicator for this perspective.

Question 10

Communicating the expectations of top management to segment managers improves goal congruence.

Accepted Answer

Communicating the expectations of top management to segment managers ensures that everyone is on the same page and working towards the same goals, which improves goal congruence.

Question 11

Qvoware Inc.sells cosmetic products in the United States.Which one of the following is most likely to be a cost center for Qvoware?
A)a Qvoware retail store in Dallas
B)the Qvoware HR department
C)a Qvoware kiosk at a mall for selling its products
D)the Qvoware product lines

Accepted Answer

The Qvoware HR department is most likely to be a cost center as it incurs expenses related to employee salaries, benefits, and training. The other options are either revenue centers (such as the Qvoware retail store and kiosk) or profit centers (such as the Qvoware product lines).

Question 12

Which of the following managers is likely to have the least amount of responsibilities for a company?
A)the manager of a cost center
B)the manager of a profit center
C)the manager of an investment center
D)the manager of a transfer pricing center

Accepted Answer

Cost centers are responsible for controlling costs but do not have responsibility for generating revenue or profits, making their responsibilities less than those of profit or investment centers. Transfer pricing centers are not typically a type of managerial responsibility.

Question 13

The performance measurement system should provide incentives to segment managers for coordinating the activities of the subunits and focusing them toward the overall company objectives.Which of the following performance measurement goals has been described by this statement?
A)motivating segment managers
B)promoting goal congruence
C)providing feedback
D)benchmarking

Accepted Answer

The statement is describing the goal of promoting goal congruence, which refers to aligning the goals of the subunits with the overall company objectives. This can encourage coordination and cooperation among segment managers, leading to improved performance for the company as a whole. Incentives are one way to promote goal congruence, by rewarding managers who work towards the common objectives rather than just optimizing their own subunit's performance. The other options (motivating segment managers, providing feedback, and benchmarking) could all be valid goals of a performance measurement system, but they are not the specific one described in this statement.

Question 14

A company that uses a balanced scorecard has established a KPI for product quality.If the actual warranty claims are higher than expected it indicates that the quality standards have been met.

Accepted Answer

If the actual warranty claims are higher than expected, it indicates that the quality standards have not been met as there are more customer complaints and issues with the product. A higher number of warranty claims is a negative outcome for the KPI of product quality.

Question 15

The balanced scorecard is a performance evaluation system that requires management to consider financial measures of performance,but not nonfinancial measures.

Accepted Answer

The balanced scorecard is a performance evaluation system that requires management to consider both financial and nonfinancial measures of performance. It looks at different perspectives, including financial, customer, internal processes, and learning and growth, to provide a more comprehensive view of organizational performance.

Question 16

The practice of comparing a company's achievements against the best practices in the industry is known as goal congruence.

Accepted Answer

The practice of comparing a company's achievements against the best practices in the industry is known as benchmarking. Goal congruence refers to the alignment of individual goals with organizational goals.

Question 17

The level of employee satisfaction is a key performance indicator of the ________.
A)financial perspective of a balanced scorecard
B)learning and growth perspective of a balanced scorecard
C)internal business perspective of a balanced scorecard
D)customer perspective of a balanced scorecard

Accepted Answer

Employee satisfaction is related to the learning and growth perspective, which focuses on the development and well-being of employees to improve organizational performance.

Question 18

A good balanced scorecard focuses only on lead indicators,because lag indicators are not important for the scorecard.

Accepted Answer

A good balanced scorecard should include both lead and lag indicators. Lead indicators are used to measure progress towards achieving goals and targets, while lag indicators measure actual results and outcomes achieved. Both are important for a comprehensive and balanced evaluation of performance.

Question 19

Key performance indicators (KPIs)are summary performance measures that help managers assess whether the company is achieving its goals.

Accepted Answer

KPIs are indeed summary performance measures that help assess whether a company is meeting its goals.

Question 20

A lag indicator is a performance measure that forecasts future performance.

Accepted Answer

A lag indicator measures past performance and does not necessarily forecast future performance. Lag indicators are used to monitor progress towards goals and identify opportunities for improvement, but they do not predict future outcomes.

Quiz 24: Responsibility Accounting and Performance Evaluation

Which of the following managers is likely to have the most different responsibilities for a company?

Which of the following internal business perspective key performance indicators (KPIs) is commonly used to assess the innovation process?

Which of the following four perspectives of the balanced scorecard enables the management to answer the question,"How can we continue to improve and create value?"

Which of the following is a responsibility that is common to the managers of cost,profit,and investment centers?

Which of the following best describes the manager of a profit center?

One part of the balanced scorecard helps management answer the question,"How do we look to shareholders?" Which of the four perspectives is being described here?

Performance evaluation systems provide top management with a framework for maintaining control over the entire organization.

Qvoware Inc.sells cosmetic products in the United States.Which one of the following is most likely to be a revenue center for Qvoware?

Which of the following is most likely a key performance indicator of the internal business perspective of the balanced scorecard?

Communicating the expectations of top management to segment managers improves goal congruence.

Qvoware Inc.sells cosmetic products in the United States.Which one of the following is most likely to be a cost center for Qvoware?

Which of the following managers is likely to have the least amount of responsibilities for a company?

The performance measurement system should provide incentives to segment managers for coordinating the activities of the subunits and focusing them toward the overall company objectives.Which of the following performance measurement goals has been described by this statement?