Chapter 20 Basic Elements of Control TRUE FALSE 1 Effective control helps managers decide where they want their business to go point it I that direction and monitor results to keep it on track ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 647 OBJ 20 1 2 A properly designed control system can help management anticipate monitor and respond to changing circumstances ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 647 OBJ 20 1 3 One purpose of control is to simplify organizations ANS F NAT AACSB R PTS 1 MSC Type Comp REF p 647 OBJ 20 1 4 The responsibility for managing control rests on the CEO ANS F NAT AACSB R PTS 1 MSC Type Comp REF p 649 OBJ 20 1 5 Financial resource controls are interrelated with the control of all other organizational resources ANS T NAT AACSB A PTS 1 MSC Type Def REF p 649 OBJ 20 1 6 Strategic controls are concerned with how well the organization aligns itself with the environment ANS T NAT AACSB A PTS 1 MSC Type Def REF p 649 OBJ 20 1 7 The last step in the control process is to change the standard ANS F NAT AACSB A PTS 1 MSC Type Def REF p 650 OBJ 20 1 8 As much as possible standards established for control purposes should reflect the goals of the organization ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 651 OBJ 20 1 9 After a comparison of performance to standards one action that may be appropriate is to do nothing ANS T NAT AACSB R Chapter 20 PTS 1 MSC Type Comp REF p 652 OBJ 20 1 1 2011 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in whole or in part 10 Reporters who verify stories with additional sources are using screening control ANS F NAT AACSB R PTS 1 MSC Type App REF p 653 OBJ 20 2 REF p 653 OBJ 20 2 11 An after action report is a screening control ANS F NAT AACSB R PTS 1 MSC Type App 12 The most common controls are screening controls ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 653 OBJ 20 2 13 An effective way to promote employee participation in the control process is to use screening controls ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 653 OBJ 20 2 14 Operations controls monitor input transformation and output ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 655 OBJ 20 2 15 The CEO is responsible for developing the budget and communicating it to managers ANS F NAT AACSB A PTS 1 MSC Type Def REF p 655 OBJ 20 3 16 An operating budget is a budget that determines the number of units to be produced during the coming time period ANS F NAT AACSB A PTS 1 MSC Type Def REF p 656 OBJ 20 3 17 The listing of an organization s assets and liabilities at a particular point in time can usually be found in its cash flow budget ANS F NAT AACSB A PTS 1 MSC Type Def REF p 660 OBJ 20 3 18 Return ratios are measures of an organization s ability to convert assets into cash quickly ANS F NAT AACSB A PTS 1 MSC Type Def REF p 660 OBJ 20 3 19 Some auditors specialize in legal bills pension plans or benefit plans ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 660 OBJ 20 3 20 Internal audits examine the efficiency and appropriateness of financial and accounting procedures Chapter 20 2 2011 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in whole or in part ANS T NAT AACSB A PTS 1 MSC Type Def REF p 661 OBJ 20 3 21 Internal audits are not as effective as external audits ANS F NAT AACSB R PTS 1 MSC Type Comp REF p 661 OBJ 20 3 22 Bureaucratic control focuses on enhanced performance that exceeds minimum acceptable standards ANS F NAT AACSB R PTS 1 MSC Type Comp REF p 661 OBJ 20 4 23 Decentralized control relies heavily on self control by the organization s employees ANS T NAT AACSB A PTS 1 MSC Type Def REF p 662 OBJ 20 4 24 Bureaucratic control is outdated and not effective any more ANS F NAT AACSB R PTS 1 MSC Type Comp REF p 663 OBJ 20 4 25 Strategic control in global organizations is the same as domestic organizations ANS F NAT AACSB R PTS 1 MSC Type Comp REF p 663 OBJ 20 5 26 Information systems are an essential element of strategic control ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 664 OBJ 20 5 27 The planning and controlling functions are interrelated ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 666 OBJ 20 6 28 Toyota is designing a new car At the same time it is planning the recycling abilities of the parts Toyota is effectively integrating planning and control processes ANS T NAT AACSB R PTS 1 MSC Type App REF p 666 OBJ 20 6 29 Managers make a surprisingly large number of decisions based on inaccurate information ANS T NAT AACSB R PTS 1 MSC Type Comp REF p 666 OBJ 20 6 30 If objective data are available they will provide more useful information than will mere subjective impressions ANS T NAT AACSB R Chapter 20 PTS 1 MSC Type Comp REF p 666 OBJ 20 6 3 2011 Cengage Learning All Rights Reserved May not be scanned copied or duplicated or posted to a publicly accessible website in whole or in part 31 As the number of things being controlled by the organization increases the likelihood that employees will resist those controls tends to decrease ANS F NAT AACSB R PTS 1 MSC Type Comp REF p 668 OBJ 20 6 REF p 646 OBJ 20 1 MULTIPLE CHOICE 1 The basic purpose of control is a to cope with organizational complexity b to adapt to environmental changes c to minimize costs d to limit the accumulation of error e All of these choices ANS E NAT AACSB A PTS 1 MSC Type Def 2 Organizational control is a the regulation of management activities to increase leadership b the regulation of organizational activities to facilitate goal attainment c the system that monitors and manages via a self regulating mechanism d a mechanism for maintaining the status quo e a device for determining where the organization should be at some future time ANS B NAT AACSB A PTS 1 MSC Type Def REF p 646 OBJ 20 1 3 The purpose of control is to a determine where the organization should be at some point in the future b assess organizational performance relative to some desired goal c determine how to structure the organization so …