| Question 1 |
To implement a new or modified reward system, sales managers should do all of the following except
Question options:
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| clearly communicate details of the plan to the salesforce prior to its implementation. |
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| encourage salesforce feedback. |
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| promptly answer questions. |
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| issue a press release detailing the company's changes. |
| Question 2 | |
The most widely used type of financial pay plan is
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| straight salary. |
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| salary plus a bonus. |
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| a combination pay plan. |
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| straight salary plus expenses. |
| Question 3 | |
Which of the following is an example of a selling situation requiring a commission split?
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| A field salesperson sells a computer to a customer and sometime after the sale, it requires a service call from a company service technician. |
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| A salesperson needs help from a salaried technical expert to provide a potential customer with certain information. |
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| A large company purchases products from a company and ships them to its affiliates in several cities. The selling firm's salespeople in these cities are then required to provide follow-up and service. |
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| A salesperson provides a list of referrals that aren't in his or her territory to the salesperson covering that territory. |
| Question 4 | |
________ implies that salespeople choose where their effort will be spent among various job activities.
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| Degree |
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| Persistence |
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| Tenacity |
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| Direction |
| Question 5 | |
Current spendable income includes
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| salaries and commissions, but not bonuses. |
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| salaries only. |
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| salaries, commissions, and bonuses. |
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| any cash award, but not bonuses such as merchandise or free trips. |
| Question 6 | |
Flexibility has been cited as both an advantage and a disadvantage of this compensation pay plan:
Question options:
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| Straight salary |
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| Combination pay plans |
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| Straight commission |
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| Straight commission with bonuses |
| Question 7 | |
When it's difficult for the salesperson to secure the first order from the customer, but reorders are virtually automatic, what form of commission rate would be appropriate?
Question options:
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| Regressive |
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| Incremental |
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| A combination of constant and progressive rates |
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| Constant |
| Question 8 | |
Which one of the following forms of commission rate may actually result in overselling and higher selling costs to the company?
Question options:
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| regressive. |
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| incremental. |
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| a combination of constant and regressive rates. |
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| progressive. |
| Question 9 | |
Perhaps the most serious shortcoming of straight-commission plans is that
Question options:
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| salespeople may earn more than their managers. |
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| they contribute little to company loyalty, resulting in potential <br /> salesforce control problems. |
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| the firm suffers financially if the market declines or stagnates. |
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| they link compensation to actual sales. |
| Question 10 | |
A salesperson who is intrinsically motivated
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| is motivated by the rewards that the job provides. |
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| is motivated by the need for love and belongingness. |
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| finds the job to be inherently rewarding. |
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| finds that the job's fringe benefits, pay, and generous vacation policy provide motivation. |
| Question 11 | |
When a sales manager assures salespeople that they fulfill a critical role in revenue production and other key activities within the company, which type of nonfinancial reward is being offered?
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| Opportunity for personal growth |
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| Recognition for achievement |
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| Sense of accomplishment |
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| Job security |
| Question 12 | |
A salesperson who is extrinsically motivated
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| would work for the pure pleasure of working. |
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| doesn't need or desire formal recognition for outstanding achievements. |
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| is motivated by personal growth needs. |
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| is motivated by the rewards that the job provides. |
| Question 13 | |
_______ rewards are those that are given in return for acceptable performance or effort.
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| Sales |
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| Intrinsic |
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| Noncompensation |
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| Compensation |
| Question 14 | |
If the nonselling administrative duties of the salesperson are of major importance, which compensation plan is recommended?
Question options:
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| Straight salary |
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| Salary plus bonuses |
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| Straight commission |
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| Salary plus commission |
| Question 15 | |
The amount of mental and physical effort put forth by the salesperson refers to
Question options:
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| degree. |
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| persistence. |
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| tenacity. |
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| intensity. |
| Question 16 | |
What change in the firm's salesforce reward system might be in response to customers' needs?
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| A pay freeze |
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| A change from straight commission to straight salary |
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| The introduction of a sales contest |
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| A change from straight salary to straight commission |
| Question 17 | |
Which of the following is an advantage of a straight-commission compensation plan?
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| Operating costs are minimized during slack selling periods. |
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| They are highly flexible, allowing frequent changes in compensation practices to achieve short-term objectives. |
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| They are attractive to college graduates desiring an opportunity to earn while they train. |
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| The salesforce's loyalty to the company is enhanced. |
| Question 18 | |
The most commonly used definitions of motivation include which of the following three dimensions?
Question options:
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| Intensity, degree, persistence |
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| Severity, direction, perseverance |
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| Persistence, intensity, direction |
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| Instruction, degree, tenacity |
| Question 19 | |
Industries that have traditionally used a straight-commission-based compensation pay plan include all of the following except
Question options:
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| real estate. |
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| securities. |
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| automobiles. |
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| computers. |
| Question 20 | |
Formal recognition programs have a better chance of success if sales managers do all of the following except
Question options:
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| publicize the program before it is implemented. |
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| make it easy enough to allow for a majority of the salesforce to win. |
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| ensure that the celebration for winners is well-conceived and executed. |
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| arrange for individual salespeople or sales teams to acknowledge the <br /> support of others who helped them win the award. |
| Online Exam 7 | |
| Question 21 |
Which of the following provides a benchmark for the evaluation of selling costs?
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| Sales quotas |
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| Selling budgets |
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| Cost quotas |
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| Variance analysis |
| Question 22 | |
In this type of profitability analysis, the shared selling costs are allocated to individual units based on some type of cost allocation procedure:
Question options:
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| The contribution approach to income statement analysis |
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| The full-cost approach to residual income analysis |
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| Return on assets managed approach |
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| The full-cost approach to income statement analysis |
| Question 23 | |
A more centralized sales organization will place budget responsibility
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| with the sales manager. |
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| with the salesperson. |
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| at lower sales management levels. |
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| at higher sales management levels. |
| Question 24 | |
In a sales analysis, which of the following comparisons would not be made?
Question options:
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| Comparisons with forecasts |
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| Comparisons with previous period |
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| Comparisons between actual and budgeted costs |
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| Comparisons with industry/competitors |
| Question 25 | |
Which method of determining expenditure levels for selling expense categories depends upon accurate sales forecasts?
Question options:
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| Objective and task method |
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| Zero-based budgeting |
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| Cost-justification method |
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| Percentage-of-sales method |
| Question 26 | |
The sales growth experienced by different organizational levels can be determined by
Question options:
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| a comparison of actual sales results to those achieved by competitors. |
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| a comparison of actual sales results to sales forecasts. |
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| a comparison of actual sales results to sales quotas. |
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| a comparison of actual sales results to previous periods' sales. |
| Question 27 | |
The basic concept underlying the use of this analytical method is that costs are allocated to individual units on the basis of how the units actually expend or cause these costs.
Question options:
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| Activity-based costing |
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| Cost analysis |
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| Profitability analysis |
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| Hierarchical sales analysis |
| Question 28 | |
The basic form of this method for determining expenditure levels for selling expense categories could be called zero-based budgeting:
Question options:
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| Objective and task method |
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| Profitability projections |
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| Cost-justification method |
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| Profit margin budgeting |
| Question 29 | |
The _______ method calculates an expenditure level for each category by multiplying an expenditure percentage times forecasted sales.
Question options:
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| objective and task |
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| expenditure projection |
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| cost-justification |
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| percentage-of-sales |
| Question 30 | |
Probably the most often used method to establish selling budgets is
Question options:
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| objective and task method. |
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| profitability projections. |
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| cost-justification method. |
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| percentage-of-sales method. |
| Question 31 | |
The two most direct approaches for evaluating sales organization effectiveness are
Question options:
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| sales analysis and income statement analysis. |
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| productivity analysis and cost analysis. |
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| sales analysis and cost analysis. |
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| residual income analysis and sales analysis. |
| Question 32 | |
An evaluation of sales results throughout the sales organization from a top-down perspective is a
Question options:
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| hierarchical sales analysis. |
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| scaled sales analysis. |
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| stepladder sales analysis. |
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| pyramid sales analysis. |
| Question 33 | |
Calculate the profit contribution as a percentage of sales to be used in the ROAM calculation. If sales = $20,000,000; accounts receivable = $8,000,000; and profit contribution = $5,000,000, the profit contribution is
Question options:
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| 20 percent. |
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| 40 percent. |
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| 50 percent. |
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| 25 percent. |
| Question 34 | |
In budgeting for each expense category, a sales manager should attempt to
Question options:
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| set the budget at the lowest possible level. |
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| determine the lowest expenditure level necessary to achieve the sales quotas. |
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| cut costs from last year's level of expenditure. |
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| justify the highest possible level of expenditure in order to have some flexibility in the budget. |
| Question 35 | |
In this approach to profitability analysis, the indirect or shared costs are not included in the individual unit analysis:
Question options:
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| The contribution approach to income statement analysis |
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| The full-cost approach to residual income analysis |
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| Return on assets managed approach |
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| The full-cost approach to income statement analysis. |
| Question 36 | |
Which of the following would not be an expense category for a selling budget?
Question options:
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| Recruiting expenses |
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| Salespeople's lodging expenses |
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| Production expense |
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| Salespeople's salaries |
| Question 37 | |
Productivity improvements can be obtained by
Question options:
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| increasing output. |
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| increasing input. |
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| increasing output with the same level of input. |
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| increasing input with the same level of output. |
| Question 38 | |
Recruitment, selection, and sales training are examples of factors considered in which area of the sales organization audit framework?
Question options:
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| Sales-management evaluation |
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| Sales-organization strategies |
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| Sales-organization environment |
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| Sales-management functions |
| Question 39 | |
District 1 has a poor level of ROAM. However, their profit contribution percentage is acceptable, but they have a very low asset turnover ratio. What might cause this?
Question options:
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| Selling too many low-margin products |
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| Problems with accounts payable |
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| Negotiating low selling prices |
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| Problems with accounts receivable |
| Question 40 | |
The most common type of sales organization assessment focuses on
Question options:
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| cost analysis. |
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| profitability analysis. |
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| productivity analysis. |
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| sales analysis. |
