Exam 8: Evaluating the Effectiveness of the Organization

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Extraorganizational factors including technological, political, legal, and economic-demographic factors are considered in this area of the sales organization audit framework:

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Analysis of sales dollars or sales units provides the same evaluative information.

(True/False)
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The sales organization audit is a tool that needs to be used only by those firms that are not achieving their goals.

(True/False)
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The full-cost approach to income statement analysis is more popular than the contribution approach because firms feel that it is more objective.

(True/False)
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The effectiveness of the percentage-of-sales method depends in part on the appropriateness of the expenditure percentages used.

(True/False)
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The most often-used sales definition defines a sale as

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Which of the following statements regarding sales organization effectiveness is true?

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Assessing the success of a sales organization is difficult because so many factors must be considered.

(True/False)
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What is the effectiveness index of a salesperson whose previous year's sales totaled $7,000 and whose sales quota for that period was $8,000?

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According to the text, there is no easy way to evaluate the effectiveness of the sales organization.

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The most useful input for productivity analysis is sales dollars.

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A major advantage of productivity ratios is

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The analysis of different types of sales at different organizational levels increases management's ability to detect and define problem areas in sales performance.

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Please calculate the asset turnover rate if sales = $18,000,000; cost of goods sold = $10,000,000; and total assets managed = $10,000,000:

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In a sales analysis, which of the following comparisons would not be made?

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A low-profit contribution percentage may be the result of selling low margin products or excessive selling expenses.

(True/False)
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Which of the following provides a benchmark for the evaluation of selling costs?

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Sales results lower than quota will have index value greater than 100.

(True/False)
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The sales organization audit typically will provide an assessment of sales management functions.

(True/False)
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A sales forecast represents an expected level of firm sales for defined products, markets, and time periods and for a specified strategy.

(True/False)
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