Chapter1

Which of the following statements are correct?

a. The primary function of management control is to influence behaviors in desirable ways.

b. The primary function of management control is to increase the probability that the organization’ s objectives will be achieved.

c. The benefit of management control is the increased probability that the organization’s objectives will be achieved.

d. The benefit of management control is influencing behaviors in desirable ways.

e. All of the above-named statements are correct

f. None of the above-named statement is correct

g. Statements a) and c) are correct h. Statements b) and d) are correct

Which of the following functions are the primary management functions of the value chain?

a. Product or service development

b. Operations (manufacturing products or performing services)

c. Marketing/Sales (finding buyers and making sure the products and services fulfill customer’s needs)

d. Finance (raising money)

e. All of the above-named functions

f. None of the above-named functions

g. Functions a), b) and d) h. Functions a), c) and d)

Which of the following functions are the primary management functions of the value chain?

a. Objective setting

b. Strategy formulation

c. Management control

d. Product (or service) development

e. All of the above-named functions

f. None of the above-named functions

g. Functions a), b) and d) h. Functions a), c) and d)

Which of the following functions are the primary management functions of the value chain?

a. Marketing/Sales (finding buyers and making sure the products and services fulfill customer’s needs)

b. Objective setting

c. Strategy formulation

d. Management control

e. All of the above-named functions

f. None of the above-named functions

g. Functions a), b) and d) h. Functions a), c) and d)

Which of the following statements are correct?

a. People, money, machines and information are the major type of resources with which managers must work.

b. Objective setting, strategy formulation are management functions separated along a process.

c. Strategic control and budget control are the two basic functions of control systems

d. Budgeting problems, centralization and pay-for-performance are the causes of management control problems

e. All of the above-named statements are correct

f. None of the above-named statement is correct

g. Statements a) and b) are correct h. Statements b), c) and d) are correct

Which of the following statements are correct?

a. People, money, machines and information are the major type of resources with which managers must work

b. Objective setting, strategy formulation are management functions separated along the process

c. Strategic control and management control are the two basic functions of control systems

d. Lack of direction, motivational problems and personal limitations are the causes of management control problems

e. All of the above-named statements are correct

f. None of the above-named statement is correct

g. Statements a) and b) are correct h. Statements b), c) and d) are correct

Which of the following statements referring to objective setting are correct?

a. Objective setting is one of the management functions

b. Knowledge of objectives is a prerequisite for the design of any Management Control System

c. Objectives have to be quantified and financial

d. In most organization objectives are known

e. All of the above-named statements are correct

f. None of the above-named statement is correct

g. Statements a), b) and d) are correct h. Statements a), c) and d) are correct

Which of the following statements are correct?

a. Objectives have to be quantified and financial

b. In the broadest sense, control systems can be viewed as having two basic functions- strategic control and management control

c. Managers addressing strategic control issues have a focus primarily an internal focus

d. Managers addressing management control issues have a focus primarily external to the organization

e. All of the above-named statements are correct

f. None of the above-named statement is correct

g. Statements b), c) and d) are correct h. Statements a), c) and d) are correct

Which of the following statements are correct?

a. In the broadest sense, control systems can be viewed as having two basic functions - budget control and management control

b. In the broadest sense, control systems can be viewed as having two basic functions- strategic control and management control

c. Managers addressing strategic control issues have primarily an internal focus

d. Managers addressing management control issues have a focus primarily external to the organization

e. All of the above-named statements are correct

f. None of the above-named statement is correct

g. Statements b), c) and d) are correct h. Statements a), c) and d) are correct

Which of the following categories are the main categories of control problems?

a. Motivational problems

b. Budgeting problems

c. Personal limitations

d. Lack of direction

e. All of the above-named categories

f. None of the above-named categories

g. Categories a), b) and d) are correct h. Categories a), c) and d) are correct

Which of the following statements referring to the causes of management control problems are correct?

a. Regarding to lack of direction, some employees perform Inadequately simply because they do not know what the organization wants from them.

b. Motivational problems are common because individual and organizational objectives do not naturally coincide.

c. Employees sometimes act in their own personal interest at the expense of their organization’s interest.

d. Some of the personal limitations are person-specific, other may be caused by a lack of aptitude, training, experience or knowledge of the tasks at hand.

e. All of the above-named statements are correct

f. None of the above-named statement is correct

g. Statements a), b) and c) are correct h. Statements b), c) and d) are correct

Which of the following statements are correct?

a. If the control losses are expected to be smaller than the cost of Implementing more controls than the optimal control is achieved.

b. Perfect control is a benchmark rather than adequate control.

c. Assessing whether good control has been achieved must be future-oriented and objectives driven.

d. Control problem avoidance strategies are activity elimination, automation, centralization and risk sharing.

e. All of the above-named statements are correct

f. None of the above-named statement is correct

g. Categories b), c) and d) are correct h. Categories a), c) and d) are correct

Which of the following strategies are the control problems avoidance strategies?

a. Activity elimination

b. Automation

c. Decentralization

d. Risk Sharing

e. All of the above-named strategies

f. None of the above-named strategies

g. Categories a), b) and d) are correct h. Categories b), c) and d) are correct

Which of the following strategies are the control problems avoidance strategies?

a. Activity elimination

b. Automation

c. Centralization

d. Risk sharing

e. All of the above-named strategies

f. None of the above-named strategies

g. Strategies a), b) and d) are correct h. Strategies b), c) and d) are correct

Which of the following statements are correct?

a. Automation can provide only a partial solution as an avoidance possibility - one of its limitations is feasibility.

b. Automation can provide only a partial solution as an avoidance possibility - one of its limitations are costs.

c. Automation can provide only a partial solution as an avoidance possibility - one of its limitations is that computer automation often increases control risks (replacing some control problems with other).

d. Partial avoidance possibility is also risk sharing (with outside entities), this can involve buying insurance or entering a joint venture agreement.

e. All of the above-named statements are correct

f. None of the above-named statement is correct g. Statements a), b) and c) are correct h. Statements b) and d) are correct

Which of the following alternatives are major control alternatives?

a. Providing modest performance-based incentives.

b. Offering incentives that are: highly leveraged or based on the accomplishment of targets defined in terms of accounting numbers or based on nonfinancial measures of performance.

c. Evaluating performance subjectively and using a large professional audit staff.

d. Having set of policies and procedures that expect employees to follow.

e. All of the above-named alternatives f. None of the above-named alternatives g. Alternatives a), b) and c) h. Alternatives b) and d)