MA1 Chapter 1

What is the purpose of an organisational chart?

• To demonstrate the filing and coding systems used.

• To demonstrate formal relationships and communication flows.

• To map where each department and function is located.

• To set out production schedules for a period.

Which of the following problems would be solved by the organisational chart?

• Claire is unsure who she is supposed to submit her report to.

• Claire is unsure how many days of leave she has left.

• Claire is unsure what her company insurance policy is like.

• Claire is unsure what the appropriate response to a client’s question is.

In which of the following scenarios would a centralized management approach be most feasible?

• The weather conditions in the country that QQ Ltd operates vary greatly by location.

• The work that is done by QQ Ltd is easy to standardize.

• QQ Ltd.’s customers are very diverse with big differences in demands.

• The workers required to deliver QQ Ltd.’s service to the customer is highly skilled

Which of the following represents a key characteristic of centralization?

• XYZ Ltd allows its franchisees to select their own employees.

• All branches of XYZ Ltd sell the same types of products.

• XYZ’s branch managers have the power to purchase advertising in their surrounded area

Which of the following represents a policy?

• ABC Ltd aims to achieve market share of 60% in 1 years’ time.

• Before ABC Ltd can close a sale, the goods must be delivered, and a delivery note completed by the customer and returned.

• ABC Ltd will offer limited credit terms to customers with good credit ratings.

• ABC Ltd will organize a company trip to Paris for all staff this November

Which of the following items best presents a record of company policies to interested parties?

• Accounting department

• Advertising

• Policy Manual

• Organisational chart

Which of the following is a disadvantage of policy manuals?

• Reduces the quality of employee activities.

• Reduces effective communication between senior management and subordinates.

• Provides guidelines for best practice and appropriate employee behaviour.

• Strict interpretation reduces creativity and flexibility.

Which of the following is the correct accounting equation for the Statement of Financial Position?

• Assets + Liabilities = Capital

• Capital + Assets = Liabilities

• Capital - Assets = Liabilities

• Capital + Liabilities = Assets

Which of the following describes John as gaining an asset?

• John received $200 from his mom as a gift.

• John owes Matthew $72 for using his bike.

• John borrowed his dad’s car to take his friends out on a road trip.

• John paid Matthew back the $72 that was owed to him.

Revenue - expenses = Losses. Which of the following answers correctly result in this equation?

• Revenue is less than expenses.

• Revenue is more than expenses.

• The result is a decrease in net assets (capital).

• The result is an increase in net assets (capital).