Question 1

Measures that help predict a future result are referred to as
A)Lagging indicators
B)Earnings per share
C)Leading indicators
D)EVA

Accepted Answer

Leading indicators are used to predict future results and can help decision makers take proactive steps to avoid negative outcomes or capitalize on opportunities. Lagging indicators are used to measure the past performance of an organization or an economy, while Earnings per share is a financial metric used to calculate a company's profitability.

Question 2

A difference in quantitative indicators and qualitative indicators is
A)Quantitative indicators are the same regardless of who is doing the measuring whereas qualitative indicators will differ among individual since each one has a unique perspective.
B)Qualitative indicators are subjective and quantitative indicators are objective.
C)Both Quantitative indicators are the same regardless of who is doing the measuring whereas qualitative indicators will differ among individual since each one has a unique perspective and Qualitative indicators are subjective and quantitative indicators are objective.
D)Neither Quantitative indicators are the same regardless of who is doing the measuring whereas qualitative indicators will differ among individual since each one has a unique perspective nor Qualitative indicators are subjective and quantitative indicators are objective.

Accepted Answer

Quantitative indicators are objective and measurable, while qualitative indicators are subjective and can vary based on individual perspectives.

Question 3

Which of the following is $\textbf{   not       }$ a reason companies use key performance indicators?
A)Align business activity with corporate strategy
B)Improve company performance
C)Improve timeliness of business decisions
D)All of these ans choices are reasons companies use key performance indicators

Accepted Answer

All of the choices listed are reasons why companies use key performance indicators, therefore none of them are not a reason.

Question 4

Qualitative indicators tend to be based on
A)Feelings or accounting records.
B)Feelings or perceptions.
C)Accounting records or perceptions.
D)None of these ans choices are correct.

Accepted Answer

Qualitative indicators are subjective and based on perceptions, opinions, and attitudes. They cannot be measured with accounting records alone. Therefore, the best choice is B, which indicates that qualitative indicators are based on feelings or perceptions.

Question 5

Which of the following is an example of an internal operating nonfinancial measure?
A)Accidents per month
B)Labor productivity
C)Market share
D)Product flexibility

Accepted Answer

The answer of Which of the following is an example...

Question 6

Return on investment is a financial measure that is

Accepted Answer

The answer of Return on investment is a financial measure...

Question 7

A measure that provides managers with information they need to take timely,corrective action are referred to as
A)Budget indicators.
B)Variance indicators.
C)Cycle indicators.
D)Leading indicators.

Accepted Answer

Leading indicators provide managers with information that can predict future performance, allowing them to take timely and corrective actions.

Question 8

Nonfinancial measures can be

Accepted Answer

The answer of Nonfinancial measures can be ...

Question 9

Leading indicators provide managers with the information they need to
A)Prepare direct material and direct labor variances.
B)Take timely,corrective action.
C)Prepare GAAP- based financial statements.
D)All of these ans choices are correct.

Accepted Answer

Leading indicators are used to forecast future performance and signal potential problems or opportunities. By providing managers with timely information, they can take corrective action to address issues before they become major problems. This helps to minimize risk and improve overall performance. While leading indicators may be used in preparing direct material and labor variances, and financial statements, their primary purpose is to support managerial decision-making and improve operational effectiveness.

Question 10

The best measures relate to corporate strategy and SMART.Which of the following is $\textbf{        not  }$ a component of SMART?
A)Tangible
B)Measurable
C)Relevant
D)Specific

Accepted Answer

The components of SMART are Specific, Measurable, Achievable, Relevant, and Time-bound. "Tangible" is not a component of SMART.

Question 11

Before deciding whether a measure is a leading or lagging indicator,a manager should be sure to know
A)What event the measure is related to.
B)Whether the measure is used by other companies in the industry.
C)Both What event the measure is related to and Whether the measure is used by other companies in the industry.
D)Neither What event the measure is related to nor Whether the measure is used by other companies in the industry.

Accepted Answer

A manager should know what event the measure is related to in order to determine if it predicts future performance (leading) or reflects past performance (lagging).

Question 12

Qualitative indicators
A)Tend to be based on feelings.
B)Tend to be based on perceptions.
C)Do not rely on accounting records.
D)All of these ans choices are correct.

Accepted Answer

Qualitative indicators can be based on feelings or perceptions of individuals and do not rely on accounting records. Therefore, all of the options given as answer choices are correct.

Question 13

Which of the following is an example of an employee-oriented nonfinancial measure?
A)Setup efficiency
B)Labor productivity
C)Accidents per month
D)Time to respond to customer problems

Accepted Answer

Accidents per month is an example of an employee-oriented nonfinancial measure, as it focuses on the safety and well-being of employees rather than financial performance or efficiency metrics.

Question 14

Earnings per share is a financial measure that is

Accepted Answer

The answer of Earnings per share is a financial measure...

Question 15

For managers to adequately monitor the organization's performance,they need to use
A)Leading indicators.
B)Lagging indicators.
C)Both leading indicators and lagging indicators.
D)Neither leading indicators nor lagging indicators.

Accepted Answer

Leading indicators are measures that help predict or anticipate future performance, while lagging indicators are retrospective measures that reflect past performance. By using both types of indicators, managers can take a comprehensive approach in monitoring the organization's performance. Leading indicators can provide early warnings of potential issues or opportunities for improvement, while lagging indicators can help identify trends and assess the effectiveness of past decisions or actions. Therefore, a combination of both leading and lagging indicators is necessary for effective monitoring of organizational performance.

Question 16

Which of the following is an example of a customer-oriented nonfinancial measure?
A)Product flexibility
B)Product defects
C)Production volume
D)New product introductions

Accepted Answer

Product flexibility is an example of a customer-oriented nonfinancial measure as it reflects the company's ability to meet the individual needs of customers, which is important for customer satisfaction and loyalty. Product defects, production volume, and new product introductions are financial or operational measures that do not directly indicate customer satisfaction or loyalty.

Question 17

Which of the following $\textbf{      not    }$ a qualitative measure that McDonald's would use?
A)Accidents per month
B)Customer retention
C)Current ratio
D)Number of orders filled incorrectly.

Accepted Answer

Current ratio is a quantitative measure that would not be used by McDonald's to assess the quality of their products or services. Accidents per month and number of orders filled incorrectly are also quantitative measures, but they are relevant to quality and customer satisfaction. Customer retention, on the other hand, is a qualitative measure that assesses the loyalty and satisfaction of the customers.

Question 18

The best measures relate to corporate strategy and SMART.Which of the following is $\textbf{      not   }$  a component of SMART?
A)Measurable
B)Timeliness
C)Actionable
D)Responsibility

Accepted Answer

The components of SMART are Specific, Measurable, Attainable, Relevant, and Timely. Responsibility is not included as a component of SMART.

Question 19

Which of the following is $\textbf{    not     }$  a reason companies use key performance indicators?
A)Mandate to report company performance to stakeholders
B)Increase accuracy of business decisions
C)Improve company performance
D)All of these ans choices are reasons companies use key performance indicators

Accepted Answer

All of these choices are valid reasons for companies to use key performance indicators (KPIs). KPIs provide a way for companies to track and measure their progress towards achieving their overarching goals. They can also help identify areas for improvement, increase the accuracy of business decisions, and meet reporting requirements for stakeholders.

Question 20

Which of the following is $\textbf{     not     }$ a main barrier to the effective use of nonfinancial performance measures by organizations?
A)Skepticism that the measures are directly related to the bottom line
B)Lack of management skill needed to implement the measures
C)Lack of familiarity with the measures on the part of the board members
D)Undeveloped tools for analyzing the measures

Accepted Answer

The answer of Which of the following is \(\textbf{ ...

Quiz 11: Performance Evaluation Revisited: a Balanced Approach

Measures that help predict a future result are referred to as

A difference in quantitative indicators and qualitative indicators is

Which of the following is not \textbf{ not } not a reason companies use key performance indicators?

Qualitative indicators tend to be based on

Which of the following is an example of an internal operating nonfinancial measure?

Return on investment is a financial measure that is

A measure that provides managers with information they need to take timely,corrective action are referred to as

Nonfinancial measures can be

Leading indicators provide managers with the information they need to

The best measures relate to corporate strategy and SMART.Which of the following is not \textbf{ not } not a component of SMART?

Before deciding whether a measure is a leading or lagging indicator,a manager should be sure to know

Qualitative indicators

Which of the following is an example of an employee-oriented nonfinancial measure?

Earnings per share is a financial measure that is

For managers to adequately monitor the organization's performance,they need to use

Which of the following is an example of a customer-oriented nonfinancial measure?

Which of the following not \textbf{ not } not a qualitative measure that McDonald's would use?

The best measures relate to corporate strategy and SMART.Which of the following is not \textbf{ not } not a component of SMART?

Which of the following is not \textbf{ not } not a reason companies use key performance indicators?

Which of the following is not \textbf{ not } not a main barrier to the effective use of nonfinancial performance measures by organizations?

Which of the following is $\textbf{ not }$ a reason companies use key performance indicators?

The best measures relate to corporate strategy and SMART.Which of the following is $\textbf{ not }$ a component of SMART?

Which of the following $\textbf{ not }$ a qualitative measure that McDonald's would use?

The best measures relate to corporate strategy and SMART.Which of the following is $\textbf{ not }$ a component of SMART?

Which of the following is $\textbf{ not }$ a reason companies use key performance indicators?

Which of the following is $\textbf{ not }$ a main barrier to the effective use of nonfinancial performance measures by organizations?