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Multiple Choice Questions:
1. Why are controls essential to an organization?
A)
B)
C)
D)
to meet the requirements for a balance scorecard
to alert managers to a current or potential problem
to ensure managers are monitoring the budget
to deliver exemplary customer service
2. Where should control reside within an organization?
A)
B)
C)
D)
all employees and managers, regardless of level
employee and managers close to the situation being controlled
top management only
first and mid-level managers
3. Which statement best describes total quality management (TQM)?
A)
B)
C)
D)
a collection of control techniques established by management
discovering existing defects and mistakes and correcting them
an organization-wide emphasis on quality as defined by the customer
changing business processes to improve productivity and service
4. Which category of control is least beneficial to an organization?
A)
B)
C)
D)
preventive
concurrent
corrective
output
5. Which tool facilitates control by providing a visual snapshot of key performance
indicators from current operations?
A)
B)
C)
D)
expense budget
balanced scorecard
financial ratios
business dashboard
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6. Which term best describes today’s emphasis on quality management by “building in”
quality?
A)
B)
C)
D)
quality assurance
zero defects
reengineering
total quality management
7. Which attribute does management use to measure the quality of a product or service?
A)
B)
C)
D)
reliability
performance
consumer demand
standards or specifications
8. Which of the following controls is used to track inventory?
A)
B)
C)
D)
economic order quantity
bar codes
just in time inventory
ABC classification
9. What type of control would be used to ensure accurate inventory records are maintained
and desired materials are on hand when needed?
A)
B)
C)
D)
usage control
tracking control
order quantity control
inventory control
10. Which of the following are essential to ensure employees implement controls?
A)
B)
C)
D)
acceptance and comprehension of controls
recognition and rewards for implementing controls
training and testing on control processes
manuals and posters on control procedures
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11. What is the second step of the control process?
A)
B)
C)
D)
setting performance standards
taking corrective action
comparing results with standards
collecting data to measure performance
12. Which of the following properly illustrates how standards are typically expressed?
A)
B)
C)
D)
as a weight, rate, or flat target
as an alphabetic letter, rate, or flat target
as a weight, alphabetic letter, or flat target
as a weight, rate, or alphabetic letter
13. Which types of controls already exist in most organizations and are made up of repetitive
acts?
A)
B)
C)
D)
operator controls
automatic controls
foolproof controls
informational controls
14. Which types of controls are those that require a human response?
A)
B)
C)
D)
operator controls
automatic controls
foolproof controls
informational controls
15. Which type of controls are also called preliminary controls, and attempting to stop
problem before they occur?
A)
B)
C)
D)
corrective controls
preventive controls
concurrent controls
time controls
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16. Which type of controls focus on problems that occur during a process or operation?
A)
B)
C)
D)
corrective controls
preventive controls
concurrent controls
time controls
17. Which of the following best defines a visual portrait of key performance measures,
provided online and in real time for the purpose of control?
A)
B)
C)
D)
balanced scorecard
business dashboard
control cost analysis
root cause analysis
18. Which of the following best defines a system for reporting key information in multiple
areas, all related to goal achievement?
A)
B)
C)
D)
balanced scorecard
business dashboard
control cost analysis
root cause analysis
19. What are the six common dimensions of design quality?
A)
B)
C)
D)
performance, price, reliability, serviceability, aesthetics, and reputation
price, features, reliability, serviceability, aesthetics, and reputation
performance, features, reliability, price, aesthetics, and reputation
performance, features, reliability, serviceability, aesthetics, and reputation
20. Operations control is attained by applying which three basic control concepts?
A)
B)
C)
D)
cost, quality, and inventory
cost, staff, and inventory
staff, quality, and inventory
cost, quality, and staff
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21. Which of the following best defines the process of continuous and relentless
improvement thru teamwork and employee participation?
A)
B)
C)
D)
quality at the source
continuous improvement
kaizen
quality control
22. Which of the following best defines the ongoing effort to make improvements in every
part of the organization relative to all its products and services?
A)
B)
C)
D)
quality at the source
continuous improvement
kaizen
quality control
23. Which of the following best defines a set of quality standards for international business
with the major objective of promoting the development of standardization?
A)
B)
C)
D)
six sigma
ISO 9000
lean manufacturing
reengineering
24. Which of the following best defines a systematic approach to identifying and eliminating
waste and non-value-added activities?
A)
B)
C)
D)
six sigma
ISO 9000
lean manufacturing
reengineering
25. Inventory is generally classified into which of the following three types?
A)
B)
C)
D)
raw material, in process, purchased goods
in development, in process, in shipment
raw material, in process, finished goods
in development, in process, finished goods
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26. Which of the following best defines the optimal number of units to order at one time;
determined by the point at which ordering costs equal carrying costs?
A)
B)
C)
D)
economic order quantity (EOQ)
just-in-time inventory control (JIT)
economic inventory quantity (EIQ)
just-in-time order control (JIT)
27. Which of the following is NOT a characteristic of the control process?
A)
B)
C)
D)
lengthy reports
timeliness
accuracy
beneficial comparison to cost
28. The conciseness characteristic of control suggests which of the following?
A) That controls should only be implemented at key points so as not to overburden
a process or system.
B) That controls must contain data that is valid and trustworthy to ensure that
unwarranted corrections are not made.
C) That the best controls provide key information at the earliest time possible.
D) That control data should be concise and understandable, with additional
information accessible as needed.
29. The strategic control point characteristic of control suggests which of the following?
A) That the best controls provide key information at the earliest time possible.
B) That controls should only be implemented at key points so as not to overburden
a process or system.
C) That control data should be concise and understandable, with additional
information accessible as needed.
D) That controls must contain data that is valid and trustworthy to ensure that
unwarranted corrections are not made.
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30. Which of the following best defines a way of predicting quality deviations in advance so
that a manager can take corrective action before a product is completed?
A)
B)
C)
D)
specification
standard
operational control
statistical quality control
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True/false Questions:
1. Control is the process of ensuring that organizational activities are going according to
plan in comparison to set standards, specifications, or objectives and making any
necessary corrections.
A) True
B) False
2. The first step in the control process is collecting data to measure performance.
A) True
B) False
3. The final step in the control process is to set performance standards after collecting
data.
A) True
B) False
4. A standard is the measure for judging performance of a product, service, machine,
organizational unit, or employee.
A) True
B) False
5. Foolproof controls are controls that deal with repetitive acts, and often times are controls
that already exist within a business.
A) True
B) False
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6. Supervisory controls are controls that require a human response.
A) True
B) False
7. Concurrent controls, also called preliminary controls, attempt to prevent problems before
they occur.
A) True
B) False
8. Corrective controls are controls that detect problems after they occur, but before they
reach crisis proportions.
A) True
B) False
9. A business dashboard is a system for reporting key information in multiple areas, all
related to goal achievement.
A) True
B) False
10. Management by exception is a principle of control that enables a manager to delegate
corrective action to a subordinate as long as the variances in performance are within
specified ranges.
A) True
B) False
11. Fixed overhead expenses are expenses that do not change appreciably with fluctuations
in the level of production or service.
A) True
B) False
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12. Quality at the source is the ongoing effort to make improvements in every part of the
organization relative to all its products and services.
A) True
B) False
13. Kaizen is a process of continuous improvement thru teamwork and employee
participation.
A) True
B) False
14. Six sigma is an examination and improvement of the entire production or service system.
A) True
B) False
15. Reengineering is a systematic approach to identifying and eliminating waste and nonvalue added activities.
A) True
B) False
16. Inventory is generally classified as one of three types: raw material, finished goods, sold
goods.
A) True
B) False
17. ABC classification system groups inventories based on the total value of their usage per
unit of time.
A) True
B) False
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18. A popular order quantity control is RFID technology which keeps track of inventory by
using radio frequency identification tags.
A) True
B) False
19. Timeliness controls are designed to identify problems in time for them to be fixed and
minimize their effect.
A) True
B) False
20.Accuracy controls suggest that data should be concise and understandable, with
additional information accessible for situations where more thorough analysis is needed.
A) True
B) False
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Short Answer questions:
1. What are the four steps to the control process?
2. Describe the five levels of the control pyramid.
3. Name and describe two of the tools in which managers can use to facilitate control.
4. What is the difference between variable and fixed overhead expenses?
5. Identify the five key characteristics of effective control.
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