Question 1

Control is defined as
A)the function that concentrates on the significant deviations from the expected result or standard.
B)an itemized financial statement of the income and expenses of a company's operations.
C)valid performance standards that are expressed in quantitative terms.
D)the manipulation of information or the reporting of false performance data to beat the system.
E)any process that directs the activities of individuals toward the achievement of organizational goals.

Accepted Answer

Control is any process that directs the activities of individuals toward the achievement of organizational goals. This definition encompasses a broad range of activities and mechanisms, including management practices, financial reporting, quality assurance, and more. While other answers may describe specific aspects of control (such as monitoring for deviations or using quantitative performance standards), only E captures the full scope of what control can entail in an organizational context.

Question 2

A point-of-sale terminal that sends sales data from the store checkout line immediately to a retailer's headquarters is an example of how information technology has improved concurrent control.

Accepted Answer

The point-of-sale terminal serves as a real-time information source, allowing concurrent control in retail management.

Question 3

The use of budgeting,statistical reports,and performance appraisals to regulate behavior and results is considered a component of
A)clan control.
B)market control.
C)bureaucratic control.
D)financial audits.
E)management audits.

Accepted Answer

The use of budgeting, statistical reports, and performance appraisals are all tools of bureaucratic control, which is based on rules, regulations, policies, and procedures that are used to standardize behavior and results within an organization. Clan control, on the other hand, relies on social or cultural norms to regulate behavior; market control relies on market forces to regulate behavior; financial and management audits are tools used to assess and evaluate performance, but they are not components of control systems in and of themselves.

Question 4

Dana's company relies on rules,as set forth in the employee handbook,the authority of managers,and regular employee reviews to guide performance.Dana's company uses ________ control.
A)bureaucratic
B)market
C)feedback
D)concurrent
E)clan

Accepted Answer

Bureaucratic control relies on rules and procedures to guide performance, which aligns with the description given of Dana's company's control approach. Market control relies on competition and price as well as supply and demand, which is not mentioned in the scenario. Feedback control uses performance data to make adjustments, while concurrent control takes place during the performance of a task. Clan control relies on the shared values and beliefs of an organization, which is not mentioned in the scenario.

Question 5

Three key categories of financial ratios are liquidity,leverage,and profitability.

Accepted Answer

This statement is true. Liquidity ratios measure a company's ability to meet short-term obligations, leverage ratios measure a company's ability to meet long-term obligations, and profitability ratios measure a company's ability to generate profits.

Question 6

Which of the following is not an element of bureaucratic control?
A)rules
B)exchange relationships
C)authority
D)budgets
E)performance appraisals

Accepted Answer

Exchange relationships are not an element of bureaucratic control. Bureaucratic control is primarily concerned with using formal rules, authority, budgets, and performance appraisals to regulate the behavior of individuals and organizations. Exchange relationships refer to the process of bargaining and negotiating between two parties, which may occur within or outside of a bureaucratic framework, but are not inherently part of bureaucratic control.

Question 7

With bureaucratic control,business units are treated as profit centers,and their managers are evaluated based on profit and loss.

Accepted Answer

Bureaucratic control typically involves strict rules and procedures, not treating business units as profit centers. Profit centers are more associated with market-based control systems.

Question 8

Traditional methods of cost accounting tend to be inappropriate in today's business environment because they are based on outdated methods of rigid hierarchical organization.

Accepted Answer

Traditional cost accounting methods were developed during a time when organizations had hierarchical structures with clear boundaries between departments and functions. In today's rapidly changing business environment, companies often have flatter organizational structures and cross-functional teams, making traditional cost accounting methods less relevant and effective. Instead, companies are adopting more modern cost accounting methods that embrace flexibility and adaptability.

Question 9

How does clan control differ from bureaucratic control and market control?
A)Clan control uses formal controls more often than market control and bureaucratic control do.
B)Clan control does not assume that the interests of the organization and individuals naturally diverge.
C)Clan control is based on past performance,whereas the other two try to influence future performance.
D)Clan control is based on a more negative view of human character than the other two are.
E)Clan control is more heavily based on economic factors than market control and bureaucratic control are.

Accepted Answer

Clan control differs from bureaucratic and market control in that it does not assume that the interests of the organization and individuals naturally diverge. Clan control emphasizes on the importance of establishing a sense of family among employees in which the organization views its members as a valued member of the group. This type of control is more relationship oriented rather than rule oriented, as in the case of bureaucratic control, or entirely economic oriented, as in the case of market control.

Question 10

If bureaucratic and market mechanisms are insufficient for directing a company's workforce in today's environment,it should turn to structural control.

Accepted Answer

Structural control is not the only alternative; companies can also consider cultural control, which focuses on shared values and norms to guide behavior.

Question 11

If an employee believes his or her control system is overly controlling,that employee is likely to exhibit dysfunctional behavior.

Accepted Answer

An employee who perceives the control system to be overly controlling is likely to feel demotivated and frustrated, leading to dysfunctional behavior such as decreased productivity, absenteeism, and turnover.

Question 12

Setting performance standards is the final step in a control system.

Accepted Answer

Setting performance standards is typically one of the initial steps in a control system, as it establishes the benchmarks against which actual performance is measured.

Question 13

Performance standards can only be set with respect to quantity or quality.

Accepted Answer

Performance standards can also be set in terms of time, cost, and other relevant dimensions, not just quantity or quality.

Question 14

Because financial ratios usually are expressed in compressed time horizons,they often cause management myopia.

Accepted Answer

Financial ratios are typically calculated for a specific accounting period, such as a quarter or a year. This compressed time horizon can lead to management myopia, where managers focus only on improving the ratios in the short term, rather than making decisions that are beneficial for the long-term success of the company.

Question 15

Which of the following is a symptom of an out-of-control company?
A)flexible work hours for employees
B)highly challenging organizational goals
C)lack of periodic reviews
D)highly rigid work culture
E)lack of new employees

Accepted Answer

Lack of periodic reviews is a symptom of an out-of-control company because it indicates a lack of monitoring and feedback mechanisms to ensure that goals are being met and standards are maintained.

Question 16

One of the fundamental forces that keep an organization heading in the right direction is
A)competition.
B)control.
C)accounting.
D)myopia.
E)bureaucracy.

Accepted Answer

Control is the fundamental force that helps an organization stay on track by monitoring and regulating its activities to ensure they align with its goals and objectives. This can take the form of rules, regulations, policies, procedures, and performance management systems. Competition, accounting, myopia, and bureaucracy can be important factors but do not provide the same level of direction and guidance as control.

Question 17

In large diversified companies,market controls are often used to regulate independent business units.

Accepted Answer

Market controls such as pricing, competition and consumer demand are often used to manage and regulate independent business units within a large diversified company.

Question 18

The executives at Old-Fashioned Evening Inc. ,a chain of restaurants that feature wholesome activities for young couples,believe that the company's employees share the corporate goals of service,quality,value,and "good clean fun." Because of this,corporate leadership believes that employees are motivated to work for the common good without a lot of formal controls.This is an example of ________ control.
A)feedforward
B)market
C)feedback
D)concurrent
E)clan

Accepted Answer

This scenario describes clan control, where the organization relies on shared values and socialization to guide employee behavior rather than formal controls.

Question 19

The targeted level of performance for a particular goal is known as a(n)
A)standard.
B)organization.
C)bureaucracy.
D)directive.
E)empowerment.

Accepted Answer

The targeted level of performance for a particular goal is known as a standard. Standards provide a clear and measurable goal to be achieved and help to ensure that everyone in the organization is working towards the same objective. They can be used to evaluate performance, identify areas for improvement, and track progress towards achieving the goal.

Question 20

With market control,the activities of an organization are regulated through the use of
A)rules,regulations,and formal authority.
B)budgets,statistical reports,and performance appraisals.
C)shared values,expectations,and goals.
D)pricing mechanisms and economic information.
E)real-time monitoring and fine tuning.

Accepted Answer

Market control involves regulating the activities of an organization through pricing mechanisms and economic information. This includes setting prices based on market demand and competition, as well as monitoring market trends and adjusting the organization's strategies accordingly.

Quiz 16: Managerial Control

Control is defined as

A point-of-sale terminal that sends sales data from the store checkout line immediately to a retailer's headquarters is an example of how information technology has improved concurrent control.

The use of budgeting,statistical reports,and performance appraisals to regulate behavior and results is considered a component of

Dana's company relies on rules,as set forth in the employee handbook,the authority of managers,and regular employee reviews to guide performance.Dana's company uses ________ control.

Three key categories of financial ratios are liquidity,leverage,and profitability.

Which of the following is not an element of bureaucratic control?

With bureaucratic control,business units are treated as profit centers,and their managers are evaluated based on profit and loss.

Traditional methods of cost accounting tend to be inappropriate in today's business environment because they are based on outdated methods of rigid hierarchical organization.

How does clan control differ from bureaucratic control and market control?

If bureaucratic and market mechanisms are insufficient for directing a company's workforce in today's environment,it should turn to structural control.

If an employee believes his or her control system is overly controlling,that employee is likely to exhibit dysfunctional behavior.

Setting performance standards is the final step in a control system.

Performance standards can only be set with respect to quantity or quality.

Because financial ratios usually are expressed in compressed time horizons,they often cause management myopia.

Which of the following is a symptom of an out-of-control company?

One of the fundamental forces that keep an organization heading in the right direction is

In large diversified companies,market controls are often used to regulate independent business units.

The targeted level of performance for a particular goal is known as a(n)

With market control,the activities of an organization are regulated through the use of