MULTIPLE CHOICE.
Choose the one alternative that best completes the statement or answers the question. 21)
Management control systems collect which type of data? 21)
______ A)
non-financial B)
financial C)
data from outside of the company D)
financial and non-financial, including data from both within the company and outside of the company E)
financial and non-financial
22)
A management control system should have all of the following characteristics, EXCEPT 22)
______ A)
it should motivate managers. B)
it should provide information for individual managers for decision making. C)
it should always focus on customer satisfaction. D)
it should be closely aligned to organizational goals and objectives. E)
it should motivate employees.
23)
The costs of decentralization include all of the following, except, 23)
______ A)
sub optimal decision-making. B)
increased costs of information-gathering. C)
duplication of activities. D)
too many cost centres. E)
decreased loyalty to the organization as a whole.
24)
Which of the following is FALSE concerning profit centres and cost centres? 24)
______ A)
A profit centre can exist within a decentralized organization. B)
A cost centre can exist within a centralized organization. C)
If a profit centre exists within a centralized organization, there cannot be any cost centres in the organization. D)
A profit centre can exist within a centralized organization. E)
A cost centre can exist within a decentralized organization.
25)
Which of the following is NOT a responsibility centre within an organization, whether centralized or decentralized? 25)
______ A)
cost centre B)
revenue centre C)
profit centre D)
expense centre E)
savings centre
26)
All of the following are benefits of decentralization EXCEPT 26)
______ A)
it decreases management and worker morale. B)
it leads to quicker decision making. C)
it leads to better supplier relationships. D)
it sharpens the focus of managers. E)
it creates greater responsiveness to local needs.
27)
A product may be passed from one subunit to another subunit in the same organization. The product is known as 27)
______ A)
a transfer product. B)
a secondary product. C)
an intermediate product. D)
an interdepartmental product. E)
a subunit product.
28)
The price one subunit of an organization charges for a product or service supplied to another subunit of the same organization is called 28)
______ A)
an interdepartmental product price. B)
a transfer price. C)
a subunit price. D)
an intermediate product price. E)
a fixed price.
29)
All of the following criteria may be used to choose a transfer-pricing method EXCEPT 29)
______ A)
promotion of quality products. B)
promotion of a sustained high level of management effort. C)
promotion of optimal decision making. D)
promotion of a high level of subunit autonomy. E)
promotion of goal congruence.
30)
All of the following are appropriate methods for determining transfer prices EXCEPT 30)
______ A)
cost-based transfer prices. B)
market-based transfer prices. C)
cost based transfer prices at 110% of full cost. D)
negotiated transfer prices. E)
taxation policies.
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