Performance Management Practice Questions
Course Introduction
Performance Management explores the systematic process by which organizations improve effectiveness by setting clear objectives, monitoring progress, and evaluating outcomes against strategic goals. The course covers key concepts such as goal setting, performance appraisal systems, feedback mechanisms, employee development, and the link between individual performance and organizational success. Students will learn about various approaches to performance measurement, the challenges of fair and accurate evaluation, and strategies for fostering a high-performance culture. Through case studies and practical exercises, learners will develop skills in designing, implementing, and refining performance management systems that motivate employees and drive continuous improvement.
Recommended Textbook
Cost Accounting A Managerial Emphasis 7th Canadian Edition by Charles T. Horngren
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22 Chapters
3533 Verified Questions
3533 Flashcards
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Page 2
Chapter 1: The Accountants Vital Role in Decision Making
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141 Verified Questions
141 Flashcards
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Sample Questions
Q1) Collecting information to follow through on how actual performance compares to planned or budgeted performance is referred to as
A)an accounting system.
B)scorekeeping.
C)management accounting.
D)attention directing.
E)problem solving.
Answer: B
Q2) ________ is an operational activity that is essential to corporate performance.
A)Customer focus
B)A key success factor
C)Continuous improvement
D)Supply chain
E)Value chain
Answer: B
Q3) Key success factors include time management.
A)True
B)False
Answer: True
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Page 3
Chapter 2: An Introduction to Cost Terms and Purposes
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171 Verified Questions
171 Flashcards
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Sample Questions
Q1) Finished goods inventory would normally include
A)direct materials in stock and awaiting use in the manufacturing process.
B)goods partially worked on but not yet fully completed.
C)goods fully completed but not yet sold.
D)products in their original form intended to be sold without changing their basic form.
E)goods completed and sold.
Answer: C
Q2) Actual costs are defined as
A)costs incurred.
B)direct costs.
C)indirect costs.
D)predicted costs.
E)sunk costs.
Answer: A
Q3) The plant supervisor's salary is a direct labour cost.
A)True
B)False
Answer: False
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4
Chapter 3: Cost-Volume-Profit Analysis
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156 Flashcards
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Sample Questions
Q1) A hospital receives $1,000,000 monthly in funding from various sources.Annual fixed costs are projected to be $5,000,000 and the variable cost per patient,across all departments is projected to be $534.80.Last year they treated 11,500 patients.The hospital expects a 5% increase in patients this year.A governing bylaw requires that the hospital be run as a non-profit organization. What is the maximum number of patients the hospital can expect to be able to treat assuming the operating income is zero?
A)11,500
B)12,079
C)13,000
D)more than 13,000
E)CVP analysis is not relevant for non-profit organizations.
Answer: D
Q2) An expected value is the weighted-average of the outcomes based on the percentage combinations of the incomes.
A)True
B)False
Answer: False
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Chapter 4: Job Costing
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Sample Questions
Q1) What are three possible ways to dispose of underallocated or overallocated overhead costs at the end of a fiscal year? Briefly comment on the theoretical correctness or incorrectness of each method.
Q2) Normal costing refers to
A)the average cost.
B)costs within the relevant range.
C)costs that behave like other similar costs.
D)costs included in normal pools.
E)allocating indirect costs at budgeted rates.
Q3) Direct costs are traced the same way for actual costing and normal costing. A)True
B)False
Q4) A factor used to systematically link an indirect cost to a cost object is called A)a cost allocation base.
B)a cost pool.
C)cost assignment.
D)a traceable cost.
E)a non-traceable cost.
Q5) Explain how a budgeted indirect cost allocation rate is determined.
Q6) What is the difference between an actual cost system and a normal cost system?
Page 6
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Chapter 5: Activity-Based Costing and Management
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144 Flashcards
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Sample Questions
Q1) Resources sacrificed on activities undertaken to support product lines are which of the following?
A)market-sustaining costs
B)output unit-level costs
C)batch-level costs
D)facility-sustaining costs
E)product-sustaining (service-sustaining)costs
Q2) According to an ABC system,S5 uses a disproportionately
A)smaller amount of unit-level costs.
B)larger amount of unit-level costs.
C)smaller amount of product-sustaining costs.
D)larger amount of batch-level costs.
E)smaller amount of batch-level costs.
Q3) The benefit of an ABC system is that it provides information to make better decisions at a lower costs than traditional (simple)cost systems.
A)True
B)False
Q4) List and describe the purposes of the three main guidelines for refining a cost system.
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Chapter 6: Master Budget and Responsibility Accounting
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Sample Questions
Q1) A master budget
A)includes only financial aspects of a plan and excludes nonfinancial aspects.
B)is an aid to coordinating what needs to be done to implement a plan.
C)includes broad expectations and visionary results.
D)should not be altered after it has been agreed upon.
E)is based upon budget constraints outside of management control.
Q2) What is the ending balance of accounts receivable for September,assuming uncollectible balances are written off during the second month following the sale?
A)$99,500
B)$48,500
C)$44,900
D)$46,500
E)$54,500
Q3) The improvements gained through Kaizen budgeting arise from large changes made during the budget period as a result of executive leadership.
A)True
B)False
Q4) List and describe the four approaches to budgeting.
Q5) Describe the concept of kaizen budgeting.
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Chapter 7: Flexible Budgets,variances,and Management
Control: I
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172 Verified Questions
172 Flashcards
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Sample Questions
Q1) More insight into the efficiency variance for direct materials can be gained by subdividing it into the direct materials
A)mix and volume variances.
B)market-share and market-size variances.
C)rate and usage variances.
D)price and efficiency variances.
E)mix and yield variances.
Q2) What is the All Good Things Ltd.direct labour rate variance?
A)$4,200 U
B)$4,200 F
C)$200 F
D)$4,000 F
E)$4,000 U
Q3) July's direct manufacturing labour rate variance is
A)$250.00 favourable.
B)$262.50 favourable.
C)$487.50 favourable.
D)$262.50 unfavourable.
E)$250.00 unfavourable.
Q4) Describe the purpose of variance analysis.
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Chapter 8: Flexible Budgets,variances,and Management
Control: II
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148 Verified Questions
148 Flashcards
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Sample Questions
Q1) Delivering value to the customer requires executing activities important to the value proposition.Many of the activities cannot be evaluated by financial measures of performance.List five non-financial measures of performance applicable to the hospitality industry.
Q2) When machine-hours are used as a cost allocation base,the item MOST likely to contribute to an unfavourable production-volume variance is
A)a new competitor gaining market share.
B)a new manufacturing machine costing considerably more than expected.
C)an increase in the cost of energy.
D)strengthened demand for the product.
E)an increase in the number of direct-labour hours.
Q3) An unfavourable variable overhead rate variance indicates that A)variable overhead items were used efficiently.
B)the price and/or use of variable overhead items was more than budgeted.
C)the variable overhead cost-allocation base was not used efficiently.
D)the denominator level was not accurately determined.
E)the denominator level was used more than planned.
Q4) Briefly explain the meaning of the variable overhead efficiency variance and the variable overhead rate variance.
Page 10
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Chapter 9: Income Effects of Denominator Level on Inventory Valuation
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171 Verified Questions
171 Flashcards
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Sample Questions
Q1) Which of the following is TRUE concerning throughput costing?
A)It is also called super-absorption costing.
B)It treats all costs except those related to direct labour as period costs.
C)It provides more incentive to build-up inventories than does absorption costing.
D)It provides more incentive to build-up inventories than does variable costing.
E)Other things being equal,is more conservative than absorption costing.
Q2) What is contribution margin using variable costing?
A)$96,250
B)$91,000
C)$84,000
D)$78,750
E)$52,500
Q3) Variable costing does not include variable indirect manufacturing costs as inventoriable costs.
A)True
B)False
Q4) Throughput costing treats all costs as period costs.
A)True
B)False
11
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Chapter 10: Analysis of Cost Behaviour
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212 Verified Questions
212 Flashcards
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Sample Questions
Q1) If the number of new hires is considered the cost driver,what amount of personnel costs will be allocated to Department A?
A)$24,000
B)$10,667
C)$102,400
D)$40,000
E)$50,000
Q2) A mixed cost has a fixed element.
A)True
B)False
Q3) A cause-and-effect relationship,relative to cost drivers and resulting costs,may develop because of physical relationships,contractual relationships,or implicit relationships.
A)True
B)False
Q4) The number of defects in units shipped to customers as a percentage of total units shipped,is a non-financial measure.
A)True
B)False
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Chapter 11: Decision Making and Relevant Information
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174 Verified Questions
174 Flashcards
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Sample Questions
Q1) Outsourcing is risk free to the manufacturer because the supplier now has the responsibility of producing the part.
A)True
B)False
Q2) The objective of the theory of constraints is to increase throughput contribution while decreasing investments and operating costs.
A)True
B)False
Q3) Other than price,what other item should Grant's Kitchens consider before accepting this one-time-only special order?
A)reaction of shareholders
B)management stock options
C)demand for cherry cabinets
D)price is the only consideration
E)reaction of existing customers to the lower price offered to Ms.Wang
Q4) Describes the steps involved in solving a linear programming problem.
Q5) Producing more non-bottleneck output increases throughput contribution. A)True B)False
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Chapter 12: Pricing Decisions, product Profitability
Decisions, and Cost Management
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Sample Questions
Q1) The three major influences on pricing decisions are: costs,competitors,and customers.
A)True B)False
Q2) What is the change in operating income if marketing is correct and only the sales price is changed?
A)$2,200,000
B)$600,000
C)$(2,200,000)
D)$(5,800,000)
E)$(1,900,000)
Q3) What is the full cost of the product per unit?
A)$60
B)$180
C)$198
D)$66
E)$155
Q4) Locked-in costs are costs that have been incurred. A)True B)False
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Chapter 13: Strategy,balanced Scorecard,and Profitability Analysis
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161 Verified Questions
161 Flashcards
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Sample Questions
Q1) Referring to Luke Company,which of the following is a measure of the customer perspective?
A)return on investment
B)market share in the high-end appliance market
C)development of new products or services
D)production cycle time
E)revenue growth
Q2) Referring to Barry Company,which of the following is a measure of the customer perspective?
A)operating income growth from charging higher margins for XX 300
B)yield
C)production cycle time
D)improving manufacturing processes
E)customer satisfaction rating
Q3) What are the four key perspectives in the balanced scorecard?
Q4) Employee satisfaction is a measure of the internal business process perspective of the balanced scorecard.
A)True
B)False
Q5) What is the primary purpose of the balanced scorecard?
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Chapter 14: Period Cost Allocation
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Sample Questions
Q1) Which of the following is NOT a common criteria used to guide decisions related to cost allocations?
A)ability to bear
B)benefit received
C)causality
D)fairness and equity
E)stable market prices
Q2) In a firm's value chain upstream costs are categorized as
A)customer service costs.
B)production costs.
C)design costs.
D)marketing costs.
E)distribution costs.
Q3) If the stand-alone method were used,what amount of cost would be allocated to the start-up business?
A)$20,000
B)$100,000
C)$80,000
D)$84,000
E)$67,200
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Chapter 15: Cost Allocation: Joint Products and Byproducts
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Sample Questions
Q1) What is the paper's sales value at the splitoff point?
A)$120
B)$1,160
C)$1,200
D)$1,950
E)$3,000
Q2) Joint costs are incurred beyond the splitoff point and are assignable to individual products.
A)True
B)False
Q3) The method of allocating joint product costs is an important guide for other management decisions.
A)True
B)False
Q4) What are separable costs?
Q5) List the reasons that the sales value at splitoff method of joint cost allocation should be used.
Q6) All separable costs in joint cost allocations are always incremental costs.
A)True
B)False
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Chapter 16: Revenue and Customer Profitability Analysis
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152 Flashcards
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Sample Questions
Q1) Using the stand-alone method with selling price as the weight for revenue allocation,what amount of revenue will be allocated to Reading Fun in the first package (Reading Fun & Math Fun)?
A)$40
B)$44
C)$38
D)$50
E)$22
Q2) The cost of the manager of a retail distribution channel would MOST likely be classified as a
A)customer-sustaining cost.
B)distribution-channel cost.
C)customer batch-level cost.
D)corporate-sustaining cost.
E)customer output unit-level cost.
Q3) The stand-alone method may use selling price or unit costs to allocate revenues. A)True
B)False
Q4) List at least three different levels of costs in a customer-cost hierarchy and an example of each.
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Chapter 17: Process Costing
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Sample Questions
Q1) A distinctive feature of the FIFO process costing method is that the work done on beginning inventory before the current period is averaged with work done in the current period.
A)True
B)False
Q2) Calculate equivalent units for direct materials at Apex Disk Company using the weighted-average method.
A)100,000 units
B)350,000 units
C)400,000 units
D)450,000 units
E)499,000 units
Q3) Process costing is extremely useful when there are a variety of products produced,as compared to the production of a single product.
A)True
B)False
Q4) List and describe the five steps in process costing.
Q5) Compare and contrast process costing and job order costing.
Q6) Discuss some typical products which would likely use process costing.
Page 19
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Chapter 18: Spoilage, rework, and Scrap
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Sample Questions
Q1) Abnormal spoilage totalled
A)1,600 units.
B)2,000 units.
C)1,680 units.
D)1,920 units.
E)1,700 units.
Q2) The costs of abnormal spoilage are written off as a loss;however,the costs of normal spoilage are treated as part of cost of goods manufactured.
A)True
B)False
Q3) Normal spoilage is avoidable and controllable.
A)True
B)False
Q4) When normal spoilage is detected,the work-in-process control account is debited in a job costing system.
A)True
B)False
Q5) When a unit has to be reworked,the rework may be classified in three ways.What are those ways,and how does the accounting for each differ?
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Chapter 19: Inventory Cost Management Strategies
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152 Flashcards
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Sample Questions
Q1) What are the annual carrying costs for Product A if the company orders at the EOQ amount?
A)$80
B)$320
C)$760
D)$160
E)$1,520
Q2) An important component in several of the cost categories which are not typically recorded in accounting systems is
A)labour costs.
B)opportunity costs.
C)ordering costs.
D)quality costs.
E)quantity costs.
Q3) The EOQ quantity for Sandrington is:
A)418 units
B)506 units
C)2,449 units
D)707 units
E)24 units
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Chapter 20: Capital Budgeting: Methods of Investment Analysis
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Sample Questions
Q1) Opportunity cost is a cost of capital for which of the following sources of funds?
A)common shares
B)short-term debt sold at a discount
C)long-term debt
D)internally generated cash flow
E)preferred shares
Q2) A new machine will cost $720,000.It is in a CCA class pool that uses a declining balance rate of 20%.The company's tax rate is 42% and it requires a 12% rate of return on investments.Calculate the present value of the the tax shield the first year assuming the savings occur at year end.
A)$60,480.00
B)$54,000.00
C)$27,000.00
D)$30,240.00
E)$37,285.71
Q3) Initial machine investment costs include cash outflows for installation and transportation.
A)True
B)False
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Chapter 21: Transfer Pricing and Multinational Management
Control Systems
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157 Verified Questions
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Sample Questions
Q1) The president of Silicon Company has just returned from a week of professional development courses and is very excited that she will not have to change the organization from a centralized structure to a decentralized structure just to have responsibility centres.However,she is somewhat confused about how responsibility centres relate to centralized organizations where a few managers have most of the authority.
Required: Explain how a centralized organization might allow for responsibility centres.
Q2) What is the transfer price per pair of shoes from the Sole Division to the Assembly Division if the transfer price per pair of soles is 125% of full costs?
A)$10.00
B)$12.50
C)$11.25
D)$20.00
E)$8.75
Q3) Market-based transfer prices are generally accepted by tax authorities because they represent arm's length prices.
A)True
B)False
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Chapter 22: Multinational Performance Measurement and Compensation
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Sample Questions
Q1) What is the for Stonybrook?
A)$1,108,000
B)$1,168,700
C)$1,315,063
D)$1,403,063
E)$994,188
Q2) The only criticism of team-based compensation is that the incentives for individual employees to excel are diminished,harming overall performance.
A)True
B)False
Q3) Comparing the performance of divisions of a multinational company operating in different countries is difficult because of the differences in economic,legal,political,social and cultural environments.
A)True
B)False
Q4) Briefly explain each of the four levers of control.Why does a company need to implement more than a diagnostic control system?
Q5) List and describe the steps involved in making decisions on performance measures.
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