Business Acumen for Compensation Professional v7.0 (C8)

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Total 85 questions

Using efficient and cost-effective approaches to integrate technology into the workplace is most likely to do what?

  • A. Reduce compensation expense
  • B. Improve program efficacy
  • C. Select the best vendors
  • D. Compensate employees competitively


Answer : B

Regarding compensation communications with executives, where do they tend to need the greatest level of understanding?

  • A. In the methods and processes used to make pay decisions
  • B. In the details of their individual compensation packages
  • C. In the overall program objectives
  • D. In the differences in pay levels for the different levels of the organization


Answer : C

What best describes an effective approach for balancing multiple priorities and perspectives regarding compensation?

  • A. Being firm and uncompromising in your decision-making
  • B. Representing your view with data and relating it to business results
  • C. Finding a compromise that may not appease all stakeholders but does not give any one group or person everything they are seeking
  • D. Giving priority to perspectives based on the job or influence level of the stakeholders


Answer : B

What best describes the primary purpose of budgeting?

  • A. Limiting spending to a fixed percentage of organizational revenue
  • B. Making choices about spending based on expectations of performance
  • C. Increasing profitability of the business annually to maximize shareholder/owner value
  • D. Complying with local legislation and maintaining accurate records to prepare financial reports and tax documents


Answer : B

What is the most accurate definition of organizational vision?

  • A. A description of who the organization is, where it is headed and what it wants for the future
  • B. A written explanation of the intention or purpose of the organization and why it is in business
  • C. A statement of what kind of organization it wants to be and the guiding principles and/or beliefs shared by stakeholders
  • D. A detailed account of the organizations goals, directions to achieve them and how it will compete


Answer : A

An organization whose focus is on obtaining capital, marketing products or services, sales growth and cash conservation is most likely to be in what stage of the business lifecycle?

  • A. Start-up
  • B. Growth
  • C. Mature
  • D. Decline


Answer : A

The “Value Store” retail company offers its customers low prices and ease of purchase by minimizing waste and striving for high efficiency. What strategy is the “Value Store” using?

  • A. Operational excellence
  • B. Product/service leadership
  • C. Customer intimacy
  • D. Brand loyalty


Answer : A

The Alpha company ships an order to a customer on March 1st and invoices the customer for the product with the shipment, with payment terms of net 30 days. The customers payment is received on April 5th. The payment clears the bank and shows on Alphas account on April 8th. If Alpha is using accrual accounting, when does it record the revenue for this sale?

  • A. March 1st
  • B. March 31st
  • C. April 5th
  • D. April 8th


Answer : A

Which financial statement or combination of statements provide(s) the most comprehensive view of the companys financial situation?

  • A. The balance sheet
  • B. The income statement
  • C. The cash flow statement and the income statement
  • D. The cash flow statement, along with the balance sheet and income statement


Answer : D

What statement is most accurate regarding compensation communications with employees at varying levels?

  • A. They tend to be fairly consistent because the elements of pay may differ, but the concerns are universal.
  • B. They generally require a greater degree of detail for lower level employees who have less of an understanding of pay plan design.
  • C. They usually require more detail for senior employees regarding plan details and performance and the needs from one employee group to another can vary greatly.
  • D. They should be kept to a minimum for employees at all levels to maximize efficiency and efforts can be focused only on those who have questions.


Answer : C

What best describes a benefit of business acumen with regard to career development?

  • A. The ability to display confidence and decisiveness that will inspire others and make you a better leader
  • B. A greater likelihood of promotion, especially when you are competing with individuals with more experience
  • C. Increased marketability, which will lead to qualification for opportunities outside of human resources
  • D. It is critical to your career development and a deficiency is very likely to hinder career advancement and success.


Answer : A

You have been asked to develop a short-term incentive plan that motivates employees in business units to increase productivity. Your team has designed a plan that rewards managers and employees quarterly based on achievement against target on measures that should generate productivity increases that will self-fund the plan. When presenting the plan to senior management, what would be the best strategy to receive approval?

  • A. Demonstrate how it is aligned to the rewards philosophy, principles and organizational business strategy
  • B. Provide details on the plan design and measures and how they will be administered to employees at different levels
  • C. Make the case that a self-funded plan poses no risk to the organization while creating the potential for significant gains
  • D. Identify in advance the priorities of the various stakeholders and design your presentation to address any objections or perceptions they may have


Answer : A

What best describes a necessary skill and/or behavior in relation to business acumen?

  • A. An understanding of the culture and subcultures of your organization
  • B. The capacity to manage multiple projects and priorities and meet deadlines
  • C. A willingness to take on additional duties and responsibilities when resources are limited
  • D. A thorough understanding of the products and/or services your organization provides


Answer : A

What metric should compensation professionals pay closest attention to for ensuring alignment between the compensation strategy and the HR and business strategies?

  • A. Variable pay costs as a percent of total compensation
  • B. Total compensation expense for the business, including base pay and variable pay
  • C. Reward costs as a percent of total operating costs
  • D. The organization’s market compa-ratio


Answer : C

Which of the following is the best example of a variable cost?

  • A. Audit fees
  • B. Rent
  • C. Maintenance
  • D. Shipping


Answer : D

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Total 85 questions