Question 1

A high rate of employee turnover indicates that ________.
A) employees of the organization leave their jobs frequently
B) pay packages of employees are at par with that of the industry
C) the employee retention ratio is also high
D) employees also participate in the decision-making process

Accepted Answer

A high rate of employee turnover indicates that employees of the organization leave their jobs frequently, which can be a cause for concern for the organization as it may lead to disruptions in the workflow, loss of skilled and experienced employees, and increased costs for hiring and training new employees. Factors that contribute to high turnover rate include poor management, lack of growth opportunities, low employee morale, and inadequate compensation and benefits.

Question 2

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

Accepted Answer

The level of employee satisfaction falls under the "learning and growth" perspective of a balanced scorecard, as it measures the organization's investment in its employees' development and well-being. The financial perspective focuses on financial performance, the internal business perspective on operational efficiency, and the customer perspective on customer satisfaction.

Question 3

Percentage of market share and rate of on-time deliveries are indicators of the ________ perspective.
A) quality management
B) internal business
C) customer
D) learning and growth

Accepted Answer

The percentage of market share and rate of on-time deliveries are both indicators of the customer perspective, as they directly measure how well the organization is meeting the needs and expectations of its customers. Quality management and internal business perspectives may also be relevant, but not as directly applicable in this case. Learning and growth perspective is not directly related to these indicators.

Question 4

Madsen, Inc. intends to increase its profits by 50% in the next fiscal year. Which of the following is most likely to be a lead indicator in Madsen's performance report?
A) return on investment
B) number of repeat customers
C) net profit margin
D) sales revenue growth

Accepted Answer

The answer of Madsen, Inc. intends to increase its profits...

Question 5

Which of the following perspectives of the balanced scorecard focuses on the increase of company profits through increasing revenue growth and productivity?
A) financial
B) customer
C) internal business
D) learning and growth

Accepted Answer

The financial perspective of the balanced scorecard focuses on increasing revenue growth and productivity to ultimately increase company profits.

Question 6

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

Accepted Answer

The learning and growth perspective of the balanced scorecard focuses on the improvements and development of employees, processes, and technology that will ultimately lead to the creation of value for the organization.

Question 7

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

Accepted Answer

The financial perspective focuses on the financial health and performance of the organization, including measures such as revenue growth, profitability, return on investment, and cash flow. Answer A identifies that the question "How do we look to investors and creditors?" is related to the financial perspective.

Question 8

The balanced scorecard focuses only on lead indicators, because lag indicators are not important for performance evaluation.

Accepted Answer

The balanced scorecard includes both lead indicators (which are predictive of future performance) and lag indicators (which measure past performance). Both types of indicators are important for evaluating overall performance and determining actions to improve future results.

Question 9

A company uses a balanced scorecard and has established a key performance indicator for product quality. If the actual warranty claims are higher than expected, there is an indication that the quality standards have been met.

Accepted Answer

If the actual warranty claims are higher than expected, it indicates a failure to meet quality standards, not a successful meeting of them.

Question 10

A company's "climate for action" is a corporate culture ________.
A) that encourages communication, change, and growth
B) that is focused on strong, top-down command and control
C) that is aimed exclusively at period earnings
D) that discourages physical activity, sports, and recreation to improve employee health and morale

Accepted Answer

A company's "climate for action" is focused on promoting an open and communicative culture that encourages change and growth. It emphasizes collaboration, healthy risk-taking, and proactive engagement in decision-making for positive outcomes. This corporate culture motivates employees to take action and drive results towards achieving the company's mission and goals.

Question 11

Which of the following is 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 answer of Which of the following is a key...

Question 12

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.

Question 13

Uniox, Inc. intends to increase its profits by 50% in the next fiscal year. Which of the following is most likely to be a lag indicator in Uniox's performance report?
A) return on investment
B) number of repeat customers
C) rate of on-time deliveries
D) defect rate

Accepted Answer

Return on investment is a lagging indicator, meaning it reflects past performance rather than current or future performance. Uniox's profit increase goal for the upcoming fiscal year is a forward-looking objective, making ROI a lagging indicator in this context. The other options listed (number of repeat customers, rate of on-time deliveries, and defect rate) are all leading indicators, as they provide insight into future performance rather than just past performance.

Question 14

Which of the following affects the company's ability to make on-time deliveries?
A) return on investment
B) product's price
C) warranty claims
D) production cycle time

Accepted Answer

Production cycle time refers to the time it takes for a company to manufacture and deliver a product. If the production cycle time is long, it can impact the company's ability to make on-time deliveries because it may result in delays in the manufacturing and delivery process. The other options (A, B, and C) do not directly affect the company's ability to make on-time deliveries.

Question 15

Sales revenue growth, gross margin growth, and return on investment are the key performance indicators for the ________.
A) financial perspective
B) customer perspective
C) internal business perspective
D) learning and growth perspective

Accepted Answer

Sales revenue growth, gross margin growth, and return on investment are all financial metrics, which fall under the financial perspective of the Balanced Scorecard framework. The other perspectives (customer, internal business, and learning and growth) focus on different aspects of performance such as customer satisfaction, process efficiency, and employee development.

Question 16

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 provide managers with an objective way to evaluate the success of the company.

Question 17

Which of the following is a key performance indicator of the internal business perspective in a balanced scorecard?
A) hours of employee training
B) number of warranty claims received
C) percentage of market share
D) return on investment

Accepted Answer

The answer of Which of the following is a key...

Question 18

Which of the following is a key performance indicator of the financial perspective in a balanced scorecard?
A) hours of employee training
B) number of warranty claims
C) percentage of market share
D) return on investment

Accepted Answer

Return on investment is a financial metric that measures the profitability of an investment and is a key performance indicator of the financial perspective in a balanced scorecard. The other options are metrics that fall under different perspectives, such as the learning and growth perspective (hours of employee training), customer perspective (number of warranty claims), and market share perspective (percentage of market share).

Question 19

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 innovation within a business. This measure evaluates the company's ability to generate new and improved products, which is a key driver of business growth and competitive advantage. Therefore, option A is the best choice. Warranty claims, employee turnover rate, and on-time deliveries are not directly related to measuring innovation within a business.

Question 20

The balanced scorecard system requires management to consider ________.
A) both financial and operational performance measures
B) only performance measures
C) only leading indicators
D) only financial and customer perspectives

Accepted Answer

The balanced scorecard system requires management to consider both financial and operational performance measures. These include financial perspectives related to profitability and growth, customer perspectives related to satisfaction and loyalty, internal perspectives related to processes and efficiency, and learning and growth perspectives related to employee development and innovation.

Quiz 24: Responsibility Accounting and Performance Evaluation

A high rate of employee turnover indicates that ________.

The level of employee satisfaction is a key performance indicator of the ________ perspective of a balanced scorecard.

Percentage of market share and rate of on-time deliveries are indicators of the ________ perspective.

Madsen, Inc. intends to increase its profits by 50% in the next fiscal year. Which of the following is most likely to be a lead indicator in Madsen's performance report?

Which of the following perspectives of the balanced scorecard focuses on the increase of company profits through increasing revenue growth and productivity?

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

One part of the balanced scorecard helps management answer the question, "How do we look to investors and creditors?" Which of the four perspectives is being described with this statement?

The balanced scorecard focuses only on lead indicators, because lag indicators are not important for performance evaluation.

A company uses a balanced scorecard and has established a key performance indicator for product quality. If the actual warranty claims are higher than expected, there is an indication that the quality standards have been met.

A company's "climate for action" is a corporate culture ________.

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

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

Uniox, Inc. intends to increase its profits by 50% in the next fiscal year. Which of the following is most likely to be a lag indicator in Uniox's performance report?

Which of the following affects the company's ability to make on-time deliveries?

Sales revenue growth, gross margin growth, and return on investment are the key performance indicators for the ________.

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

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

Which of the following is a key performance indicator of the financial perspective in a balanced scorecard?

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

The balanced scorecard system requires management to consider ________.