Exam 9: Management Control Systems and Responsibility Accounting

Goal congruence exists when:

The effort to ensure that products and services perform to customer requirements

Responsibility accounting includes:

Identify which term below refers to the set of activities assigned to a manager or a group of managers or other employees.

A performance measure and reporting system that strikes a balance between financial and operating measures, links performance to rewards, and gives explicit recognition to the diversity of organizational goals

A responsibility center in which managers are responsible for costs only

Improvements in business processes must take place across all parts of the value chain.

All of the following are categories of quality costs except:

is not a step in the design of a successful management control system.

Fixed costs not controllable by a segment manager usually include depreciation and property taxes.

is (are) not a financial objective of responsibility centers.

No cost is completely under the control of a manager.

Good performance measures should be reasonably subjective.

describes the segment contribution that is controllable by segment managers.

Goal congruence exists when individuals aim at short- term goals and groups aim at long- term organizational goals.

Identify which of the following is not a characteristic of a management control system.

A management control principle that will not change is that nonfinancial performance measures are not as good as financial performance measures.

Unallocated costs usually include central corporate costs when evaluating a segment manager.

A responsibility center for controlling revenues and costs

Identify which of the following statements is true.