Setting Performance Expectations and Metrics

What is the primary purpose of regularly reviewing and updating performance expectations?

To increase cost savings
To ensure employees are overworked
To align with evolving strategic priorities (correct)
To reduce employee engagement

What type of metrics provide insights into critical areas not captured by financial measures?

Non-Financial Metrics (correct)
Financial Metrics
Activity-Based Metrics
Performance Metrics

What is a key factor to consider when choosing performance metrics?

The department's budget
The organization's size
The industry's benchmarks
The individual's role and responsibilities (correct)

What is the primary benefit of using a balanced scorecard approach?

It combines financial and non-financial measures (D) Signup and view all the answers

What is a key factor in ensuring the reliability of performance evaluations?

Ensuring consistent rating scales and clear criteria (A) Signup and view all the answers

What is the primary benefit of aligning appraisal criteria with performance expectations?

It enhances the validity of the appraisal (A) Signup and view all the answers

What is a key characteristic of a goal-oriented approach to performance evaluation?

Aligning individual performance with organizational objectives (C) Signup and view all the answers

What is the primary challenge of implementing a developmental focus approach to performance evaluation?

It requires a shift in organizational culture and mindset (D) Signup and view all the answers

What is the term for the phenomenon where a single positive or negative trait influences the overall evaluation of an employee?

Halo/Horn Effect (B) Signup and view all the answers

What is one strategy for addressing bias in performance evaluation?

Training managers on different types of biases (C) Signup and view all the answers

What is the purpose of calibration in performance evaluation?

To have managers discuss and compare their ratings to ensure consistency (B) Signup and view all the answers

Why is it important for management accountants to stay informed about the latest approaches and best practices in performance evaluation?

To improve the effectiveness of performance evaluation (C) Signup and view all the answers

What is the primary objective of standard costing in performance management?

To identify operational inefficiencies and make data-driven decisions (D) Signup and view all the answers

What is a limitation of traditional performance appraisal approaches?

They are infrequent and may not capture ongoing performance fluctuations (A) Signup and view all the answers

Which method of setting standards involves analyzing past data to identify cost trends and patterns?

Historical Analysis (C) Signup and view all the answers

What is the primary benefit of using a 360-Degree Feedback approach?

It gathers feedback from multiple sources to provide a well-rounded view of performance (C) Signup and view all the answers

What is the purpose of a Standard Cost Card?

To summarize the standard costs for each element of a product or service (D) Signup and view all the answers

What is a characteristic of Contemporary Approaches to Performance Appraisal?

They consider a broader range of perspectives and information (A) Signup and view all the answers

What is an advantage of using participative standard setting?

It ensures buy-in and ownership from employees (B) Signup and view all the answers

What is the primary focus of Management by Objectives (MBO)?

Setting specific, measurable goals and evaluating performance based on goal achievement (B) Signup and view all the answers

What is the primary benefit of benchmarking in standard costing?

It provides a comprehensive framework for assessing operational efficiency (C) Signup and view all the answers

What is the outcome of using standard costing in an organization?

Fair, accurate, and contributing to organizational success (B) Signup and view all the answers

What is a strength of traditional performance appraisal approaches?

They provide a standardized framework for evaluations (B) Signup and view all the answers

What is the primary goal of Self-Assessment in performance appraisal?

To promote self-awareness and reflection (A) Signup and view all the answers

What is the formula for calculating the Materials Quantity Variance (MQV)?

(Actual Quantity - Standard Quantity) x Standard Price (B) Signup and view all the answers

Which tool is used to visually represent potential causes and their relationships in root cause analysis?

Fishbone diagrams (A) Signup and view all the answers

What is the purpose of an Action Plan in variance analysis?

To develop detailed plans to address the root causes of variances (C) Signup and view all the answers

What is the formula for calculating the Labor Rate Variance (LRV)?

(Actual Rate - Standard Rate) x Actual Hours (A) Signup and view all the answers

What is the purpose of a Performance Dashboard in variance analysis?

To visualize key variances and performance metrics in real-time (A) Signup and view all the answers

What is the formula for calculating the Variable Overhead Variance (VOV)?

Actual Variable Overhead - (Standard Rate x Actual Activity) (D) Signup and view all the answers