Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall

Exercise 5

For the following questions, circle the best response.

To be most effective, performance reports should be

a. issued to all managers within the organization at the level of summarization or detail most appropriate to their needs.

b. controlled by the management by exception concept, which highlights only those variances that are significant.

c. designed to avoid dysfunctional behavior by reporting positive as well as negative variances.

d. issued soon after the period in which the activity took place so that results can be meaningfully linked to the actions that caused the results.

e. all of the above.