Question 1

In general,which of the following is an incentive plan design consideration?

Accepted Answer

A)  profitability
B)  the outcome of an employee election about willingness to participate in one or more incentive plans
C)  the level of risk employees will accept in their overall compensation package
D)  workforce unionizationE) A) and C)
F) B) and D)

Question 2

Over the past 10 years,Lincoln's profit-sharing payments have been substantial.Maria's annual salary was $40,000 last year,and she earned a profit-sharing payment of $10,000.Maria's profit-sharing award represents approximately what percentage of her annual salary?

Accepted Answer

A)  25 percent
B)  40 percent
C)  45 percent
D)  55 percentE) None of the above
F) A) and B)

Question 3

The general rule of thumb is that short-term company goals last less than how long?

Accepted Answer

A)  1 month
B)  6 months
C)  1 year
D)  5 yearsE) C) and D)
F) A) and B)

Question 4

Under which three conditions are individual incentive plans most appropriate?

Accepted Answer

Individual incentive pay plans are most ...

Question 5

The sales value of production (SVOP)is the sum of sales ________ plus the value of goods in inventory.

Accepted Answer

The answer of The sales value of production (SVOP)is the...

Question 6

Companies in such ________ industries as retail sales could benefit by including an incentive component in the core compensation programs they offer to employees.

Accepted Answer

The answer of Companies in such ________ industries as retail...

Question 7

With which profit sharing formula does the profit sharing pool become funded only after profits exceed a predetermined level,but fall below some established maximum level?

Accepted Answer

A)  fixed first-dollar-of-profits
B)  profitability threshold
C)  graduated first-dollar-of-profit
D)  equal paymentsE) All of the above
F) B) and D)

Question 8

Which of the following is true about the level of risk involved with incentive pay?

Accepted Answer

A)  It decreases as incentive pay represents a greater proportion of total core compensation.
B)  It is lower for higher-level employees than for lower-level employees.
C)  It depends on the extent to which employees control the attainment of a desired goal.
D)  It is dependent on subjective performance appraisals.E) B) and C)
F) A) and D)

Question 9

The ________ effect refers to a worker's willingness to work diligently to produce more quality output rather than simply attending work without putting in the effort.

Accepted Answer

The answer of The ________ effect refers to a worker's...

Question 10

Companies can control costs by replacing annual merit or seniority increases or fixed salaries with which type of plans?

Accepted Answer

A)  incentive
B)  longevity pay
C)  pay-for-knowledge pay
D)  base payE) None of the above
F) A) and D)

Question 11

These profit sharing plans award cash to employees on a quarterly or annual basis as part of their regular compensation.

Accepted Answer

A)  common
B)  current
C)  deferred
D)  anticipatedE) B) and C)
F) A) and B)

Question 12

Which of the following teams consists of a group of people who are assembled to complete a one-time assignment?

Accepted Answer

A)  project teams
B)  innovation teams
C)  process teams
D)  work teamsE) B) and C)
F) A) and D)

Question 13

Which of the following is NOT a financial measure?

Accepted Answer

A)  operating efficiency
B)  revenue
C)  earnings per stock share
D)  operating incomeE) All of the above
F) B) and C)

Question 14

To have better safety records,the XYZ Company gives monetary incentive awards to its workers for lower accident rates due to improper use of heavy equipment.Which of the following incentive plans describes this example?

Accepted Answer

A)  management incentive
B)  referral
C)  piecework
D)  behavioral encouragementE) A) and C)
F) None of the above

Question 15

Profit sharing plans and employee stock option plans are incentives on what level?

Accepted Answer

A)  individual
B)  group
C)  companywide
D)  executiveE) All of the above
F) C) and D)

Question 16

Gunther Rohn was rewarded for making a suggestion that saved Ewe and Eye Electronics thousands of dollars.Which type of incentive compensation approach might have worked best?

Accepted Answer

A)  group incentive programs
B)  gain sharing plan
C)  management incentive plans
D)  employee stock ownership planE) B) and C)
F) A) and D)

Question 17

________ profit sharing plans place cash awards in trust accounts for employees and are set aside on employees' behalf as a source of retirement income.

Accepted Answer

The answer of ________ profit sharing plans place cash awards...

Question 18

Briefly describe the three categories of incentive pay plans and give an example of each.

Accepted Answer

Incentive pay plans can be broadly class...

Question 19

This type of individual incentive plan rewards employees who recruit new customers or new employees.

Accepted Answer

A)  behavior encouragement
B)  referral
C)  management incentive
D)  pieceworkE) B) and C)
F) None of the above

Question 20

This formula for determining the amount available for profit sharing uses a specific percentage of annual profits contingent upon the successful attainment of a specified profit goal.

Accepted Answer

A)  fluctuating first-dollar-of-profits
B)  differed first-dollar-of-profits
C)  graduated first-dollar-of-profits
D)  fixed first-dollar-of-profitsE) A) and B)
F) A) and C)

Exam 4: Incentive Pay

This type of individual incentive plan rewards employees who recruit new customers or new employees.

Correct AnswerverifiedShow Answer

The sales value of production (SVOP)is the sum of sales ________ plus the value of goods in inventory.

Correct AnswerverifiedShow Answer

Which of the following teams consists of a group of people who are assembled to complete a one-time assignment?

Correct AnswerverifiedShow Answer

This formula for determining the amount available for profit sharing uses a specific percentage of annual profits contingent upon the successful attainment of a specified profit goal.

Correct AnswerverifiedShow Answer

With which profit sharing formula does the profit sharing pool become funded only after profits exceed a predetermined level,but fall below some established maximum level?

Correct AnswerverifiedShow Answer

Companies in such ________ industries as retail sales could benefit by including an incentive component in the core compensation programs they offer to employees.

Correct AnswerverifiedShow Answer

________ profit sharing plans place cash awards in trust accounts for employees and are set aside on employees' behalf as a source of retirement income.

Correct AnswerverifiedShow Answer

The ________ effect refers to a worker's willingness to work diligently to produce more quality output rather than simply attending work without putting in the effort.

Correct AnswerverifiedShow Answer

Gunther Rohn was rewarded for making a suggestion that saved Ewe and Eye Electronics thousands of dollars.Which type of incentive compensation approach might have worked best?

Correct AnswerverifiedShow Answer

Companies can control costs by replacing annual merit or seniority increases or fixed salaries with which type of plans?

Correct AnswerverifiedShow Answer

In general,which of the following is an incentive plan design consideration?

Correct AnswerverifiedShow Answer

The general rule of thumb is that short-term company goals last less than how long?

Correct AnswerverifiedShow Answer

These profit sharing plans award cash to employees on a quarterly or annual basis as part of their regular compensation.

Correct AnswerverifiedShow Answer

Briefly describe the three categories of incentive pay plans and give an example of each.

Correct AnswerverifiedIncentive pay plans can be broadly class...View AnswerShow Answer

Profit sharing plans and employee stock option plans are incentives on what level?

Correct AnswerverifiedShow Answer

Which of the following is NOT a financial measure?

Correct AnswerverifiedShow Answer

Under which three conditions are individual incentive plans most appropriate?

Correct AnswerverifiedIndividual incentive pay plans are most ...View AnswerShow Answer

To have better safety records,the XYZ Company gives monetary incentive awards to its workers for lower accident rates due to improper use of heavy equipment.Which of the following incentive plans describes this example?

Correct AnswerverifiedShow Answer

Which of the following is true about the level of risk involved with incentive pay?

Correct AnswerverifiedShow Answer

Over the past 10 years,Lincoln's profit-sharing payments have been substantial.Maria's annual salary was $40,000 last year,and she earned a profit-sharing payment of $10,000.Maria's profit-sharing award represents approximately what percentage of her annual salary?

Correct AnswerverifiedShow Answer

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Incentive pay plans can be broadly class...
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Individual incentive pay plans are most ...
View Answer

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