Tuesday, November 26, 2024

Unit 8 Business studies: Controlling, HS 2nd year Commerce

 

Set 1: Meaning and Importance of Controlling

  1. What does the function of controlling in management primarily ensure?
    A. Planning future activities
    B. Achievement of organisational goals
    C. Employee satisfaction
    D. Reducing employee turnover
    Answer: B

  2. Which of the following best defines controlling in management?
    A. Setting goals for future activities
    B. Measuring and correcting performance to ensure goals are met
    C. Allocating resources to achieve objectives
    D. Recruiting and selecting employees for the organisation
    Answer: B

  3. Why is controlling considered a goal-oriented function?
    A. It focuses on improving employee motivation
    B. It ensures that resources are used to meet predetermined goals
    C. It evaluates employee performance
    D. It enhances planning for the future
    Answer: B

  4. Which statement correctly describes the pervasive nature of controlling?
    A. Controlling is only relevant for top-level managers.
    B. Controlling applies to all levels of management in an organisation.
    C. Controlling is required only during financial crises.
    D. Controlling is limited to business organisations.
    Answer: B

  5. Which of the following is NOT a benefit of an effective control system?
    A. Accomplishing organisational goals
    B. Judging the accuracy of standards
    C. Eliminating the need for planning
    D. Facilitating coordination in action
    Answer: C

Set 2: Relationship Between Planning and Controlling

  1. Planning and controlling are referred to as “inseparable twins” because:
    A. Both are unrelated and function independently
    B. Planning sets standards, and controlling ensures those standards are met
    C. Planning works better without controlling
    D. Controlling does not depend on planning
    Answer: B

  2. What is the primary relationship between planning and controlling?
    A. Controlling precedes planning
    B. Planning sets the foundation for controlling
    C. Controlling replaces planning
    D. Planning and controlling are unrelated processes
    Answer: B

  3. Which function of management is considered forward-looking?
    A. Controlling
    B. Planning
    C. Staffing
    D. Organising
    Answer: B

  4. What does controlling provide to planning in the management cycle?
    A. New goals
    B. A method to improve future plans
    C. A replacement for strategy formulation
    D. Elimination of deviation analysis
    Answer: B

  5. Planning without controlling is considered:
    A. A waste of time
    B. Meaningless
    C. The best approach
    D. Essential for control
    Answer: B

Set 3: Steps in the Controlling Process

  1. What is the first step in the controlling process?
    A. Analysing deviations
    B. Taking corrective action
    C. Setting performance standards
    D. Measuring actual performance
    Answer: C

  2. What is the main purpose of measuring actual performance in the controlling process?
    A. To compare performance with previous years
    B. To evaluate the efficiency of the employees
    C. To compare performance with standards
    D. To set new standards
    Answer: C

  3. After measuring the actual performance, what is the next step in the controlling process?
    A. Corrective action
    B. Setting performance standards
    C. Comparing actual performance with standards
    D. Analyzing deviations
    Answer: C

  4. What should be done if the deviation in performance is beyond the acceptable range?
    A. Take corrective action
    B. Ignore it and continue working
    C. Adjust the performance standards
    D. Increase the number of tasks
    Answer: A

  5. Which of the following is a technique used to measure performance?
    A. Statistical reports
    B. Breaking even analysis
    C. SWOT analysis
    D. Forecasting
    Answer: A

Set 4: Techniques of Controlling

  1. Which of the following is considered a traditional technique of controlling?
    A. Return on investment (ROI)
    B. Management Information Systems (MIS)
    C. Performance reports
    D. PERT (Program Evaluation and Review Technique)
    Answer: C

  2. What does ratio analysis help managers in controlling?
    A. Measuring employee motivation
    B. Assessing financial health
    C. Setting new performance standards
    D. Planning production schedules
    Answer: B

  3. Which of the following is a modern technique of controlling?
    A. Breakeven analysis
    B. Ratio analysis
    C. Management audit
    D. Responsibility accounting
    Answer: D

  4. What is the role of PERT and CPM in managerial control?
    A. To evaluate employee performance
    B. To monitor project timelines and progress
    C. To calculate the company's profitability
    D. To assess market conditions
    Answer: B

  5. Which control technique focuses on evaluating the performance of an entire organisation or business unit?
    A. Responsibility accounting
    B. Management audit
    C. Ratio analysis
    D. Return on investment
    Answer: B

Set 5: Importance and Limitations of Controlling

  1. What is the main benefit of an effective control system?
    A. It helps in planning future activities
    B. It ensures the effective use of resources
    C. It eliminates the need for managers
    D. It controls external environmental factors
    Answer: B

  2. Which of the following is a limitation of controlling?
    A. It ensures proper use of resources
    B. It helps in attaining organisational goals
    C. It is difficult to set quantitative standards in certain areas
    D. It reduces employee resistance
    Answer: C

  3. Which external factor is beyond an organisation's control during the implementation of a control system?
    A. Employee behavior
    B. Government policies
    C. Resource allocation
    D. Job satisfaction
    Answer: B

  4. What might lead to resistance from employees in a control system?
    A. Too much involvement in the planning process
    B. Excessive monitoring and restrictions on freedom
    C. Lack of resources
    D. Poor communication from management
    Answer: B

  5. What is a potential issue for small enterprises in implementing a control system?
    A. Lack of leadership
    B. High costs of establishing the control system
    C. Limited goals and objectives
    D. Inconsistent performance standards
    Answer: B

Set 6: Deviations and Corrective Action

  1. What should a manager do if a deviation exceeds the permissible limit?
    A. Ignore it as it will likely resolve on its own
    B. Take corrective action immediately
    C. Update the standards to reflect the deviation
    D. Wait for the next performance review
    Answer: B

  2. Which of the following is NOT a reason for deviations from standards?
    A. Unrealistic standards
    B. Defective processes
    C. Inadequate resources
    D. Well-trained employees
    Answer: D

  3. Which control principle involves focusing attention on significant deviations rather than all issues?
    A. Management by exception
    B. Critical point control
    C. Corrective action
    D. Cost-benefit analysis
    Answer: A

  4. When taking corrective action, what is one possible solution if the performance does not meet the standards?
    A. Modify the standards
    B. Increase the number of employees
    C. Change the company’s vision
    D. Terminate underperforming employees immediately
    Answer: A

  5. In which scenario would management by exception be especially beneficial?
    A. When every minor deviation needs attention
    B. When it is difficult to track every activity
    C. When all deviations are equally important
    D. When focusing on every employee’s performance
    Answer: B

Set 7: Goals of Controlling and Control Systems

  1. What is one of the key goals of controlling in management?
    A. To make business decisions in isolation
    B. To ensure activities are performed according to plans
    C. To develop new products continuously
    D. To set up new organizations
    Answer: B

  2. Which of the following best describes a well-implemented control system?
    A. It solely relies on corrective actions
    B. It monitors progress towards achieving goals and helps make adjustments when necessary
    C. It only functions during a crisis
    D. It evaluates employee satisfaction alone
    Answer: B

  3. What is the role of standards in the controlling process?
    A. To determine the budget for the organization
    B. To serve as benchmarks for measuring actual performance
    C. To set long-term objectives
    D. To decide which employees will be promoted
    Answer: B

  4. Which is a disadvantage of having rigid standards in a control system?
    A. It may discourage employees from trying to meet the standards
    B. It can create resistance from employees
    C. It fails to account for changes in the internal or external environment
    D. It makes deviations easier to correct
    Answer: C

  5. Which of the following is a primary objective of a good control system?
    A. To restrict organizational growth
    B. To reduce employee morale
    C. To identify deviations and provide corrective actions
    D. To enhance the financial statements
    Answer: C

Set 8: Types of Standards and Measurement

  1. Which type of standards are easier to compare with actual performance?
    A. Qualitative standards
    B. General standards
    C. Quantitative standards
    D. Abstract standards
    Answer: C

  2. Which of the following is an example of a qualitative standard?
    A. Cost of production
    B. Time to complete a task
    C. Employee motivation and morale
    D. Number of units produced
    Answer: C

  3. Why are quantitative standards preferred in the controlling process?
    A. They are easier to measure and compare
    B. They require less time to set
    C. They focus on employee engagement
    D. They do not require measurement of actual performance
    Answer: A

  4. What is an example of a quantitative performance standard in a manufacturing company?
    A. Employee satisfaction
    B. Number of units produced in a given time period
    C. Quality of customer service
    D. Employee motivation levels
    Answer: B

  5. Which of the following is a technique used for measuring performance in organizations?
    A. Random sampling
    B. Personal observation
    C. Market surveys
    D. All of the above
    Answer: D

Set 9: Performance Measurement and Feedback

  1. When measuring performance, which of the following is important to ensure accuracy?
    A. Conducting the measurement once at the end of the year
    B. Using the same units of measurement as the set standards
    C. Ignoring minor deviations in performance
    D. Focusing on the overall performance instead of individual units
    Answer: B

  2. What is one key benefit of measuring performance during the execution of tasks rather than after completion?
    A. It helps prevent errors before they become significant
    B. It makes the process of setting standards more complex
    C. It increases the cost of performance measurement
    D. It reduces the scope for corrective actions
    Answer: A

  3. What is the primary purpose of a performance report?
    A. To provide feedback on the success of an individual employee only
    B. To analyze the effectiveness of marketing strategies
    C. To measure and document performance, helping managers take corrective actions
    D. To set long-term business goals
    Answer: C

  4. What type of performance measurement is commonly used in large organizations where checking every unit produced is impractical?
    A. Random sample checking
    B. Employee performance reports
    C. Pre-planned deviation analysis
    D. Full-scale employee evaluations
    Answer: A

  5. What does performance measurement help in identifying?
    A. The amount of resources needed to expand the business
    B. Deviations from the standards set for performance
    C. The number of employees who need training
    D. Future marketing strategies
    Answer: B

Set 10: Corrective Actions and Exceptions

  1. What is the main idea behind the principle of "Management by Exception"?
    A. To avoid all deviations in the organization
    B. To focus only on significant deviations that require managerial attention
    C. To micromanage every activity
    D. To delegate all tasks to subordinates
    Answer: B

  2. Which of the following is a key advantage of management by exception?
    A. It allows managers to focus on routine activities
    B. It ensures that every minor issue is addressed immediately
    C. It helps in allocating resources to the most critical areas of performance
    D. It encourages employees to ignore minor performance gaps
    Answer: C

  3. When deviations from the standard are within an acceptable range, what is generally the appropriate action?
    A. Taking no action
    B. Revising the standards
    C. Conducting a detailed investigation
    D. Rewriting the performance reports
    Answer: A

  4. What is the first step a manager should take when dealing with a major deviation from the standard?
    A. Correct the deviation immediately
    B. Ignore it if it falls within the acceptable range
    C. Analyze the causes of the deviation
    D. Increase the employee workload
    Answer: C

  5. Which of the following actions would be considered a corrective action for underperformance in a team?
    A. Providing additional training or resources
    B. Ignoring the problem and hoping it resolves itself
    C. Setting even more stringent standards
    D. Disciplining the team immediately
    Answer: A

Set 11: Control Techniques and Their Application

  1. Which of the following is an example of a modern technique of controlling?
    A. Breakeven analysis
    B. Return on investment (ROI)
    C. Management Information Systems (MIS)
    D. Responsibility accounting
    Answer: C

  2. Which of the following techniques is used to evaluate the performance of the entire business?
    A. Return on investment (ROI)
    B. Management audit
    C. Ratio analysis
    D. Budgetary control
    Answer: B

  3. In which of the following situations would responsibility accounting be most useful?
    A. To assess employee satisfaction levels
    B. To monitor the performance of individual departments or units
    C. To track employee performance based on subjective evaluations
    D. To manage employee recruitment and selection
    Answer: B

  4. What is the purpose of the "Management Information System" (MIS) in managerial control?
    A. To provide a platform for employee communication
    B. To provide accurate and timely information for decision-making
    C. To develop long-term strategic plans
    D. To monitor external market conditions
    Answer: B

  5. What is the function of "breakeven analysis" in controlling?
    A. To determine the profitability of the company
    B. To calculate the point where total revenue equals total costs
    C. To evaluate employee performance
    D. To track customer satisfaction levels
    Answer: B

Set 12: Employee Motivation and Control

  1. How does a good control system improve employee motivation?
    A. By setting unclear expectations for performance
    B. By ensuring employees understand what is expected of them and how they will be evaluated
    C. By focusing only on negative deviations
    D. By reducing the level of monitoring and supervision
    Answer: B

  2. Which of the following is NOT a way in which a control system can help in improving employee motivation?
    A. Providing clear performance standards
    B. Monitoring employees closely at all times
    C. Offering rewards for meeting targets
    D. Ensuring fair and consistent evaluation methods
    Answer: B

  3. Why is it important for a manager to communicate the standards to employees clearly?
    A. To avoid unnecessary conflict
    B. To increase employee engagement and motivation
    C. To reduce operational costs
    D. To ensure that employees follow rigid rules
    Answer: B

  4. Which of the following actions would most likely reduce resistance to a control system among employees?
    A. Increasing the number of performance reports
    B. Increasing transparency and involving employees in setting performance standards
    C. Limiting communication about the control system
    D. Using punitive measures as the primary method of control
    Answer: B

  5. Which type of control system is likely to improve employee discipline and reduce dishonest behavior?
    A. One with no monitoring or feedback
    B. One that uses strict surveillance and monitoring techniques
    C. One that sets flexible performance standards
    D. One that involves employees in decision-making
    Answer: B

Set 13: Control and Coordination

  1. How does controlling facilitate coordination in an organization?
    A. By setting standards that govern each department’s actions
    B. By creating a competitive environment among employees
    C. By focusing on individual performance over team performance
    D. By reducing the need for communication between departments
    Answer: A

  2. Which of the following is NOT a benefit of controlling in an organization?
    A. Facilitating coordination between departments
    B. Ensuring resources are used efficiently
    C. Increasing operational costs
    D. Helping in the achievement of organizational goals
    Answer: C

  3. What is the role of controlling in ensuring that all activities are aligned towards the achievement of organizational goals?
    A. It serves to reduce the budget
    B. It monitors progress and corrects deviations to maintain alignment
    C. It ensures that all departments act independently
    D. It discourages the use of resources in excess
    Answer: B

  4. Which of the following is an example of effective coordination through controlling?
    A. Creating conflict between departments
    B. Aligning departmental goals with overall organizational objectives
    C. Encouraging departments to set independent goals
    D. Restricting communication between departments
    Answer: B

  5. How does controlling help in achieving organizational goals?
    A. By ensuring all departments work towards the same targets
    B. By limiting the role of management in decision-making
    C. By focusing on long-term financial goals exclusively
    D. By measuring and rewarding individual departmental achievements
    Answer: A

Set 14: Deviation Analysis and Corrective Action

  1. What is the primary objective of analyzing deviations in performance?
    A. To find out how much an employee is paid
    B. To understand why performance did not meet the standard and identify corrective actions
    C. To eliminate the need for setting new standards
    D. To measure future organizational goals
    Answer: B

  2. When should a manager take corrective action during the controlling process?
    A. When there are no deviations from the standards
    B. When deviations are outside the permissible range
    C. When there are minor deviations within acceptable limits
    D. After the final performance report is submitted
    Answer: B

  3. Which of the following is a reason why deviations in performance should be analyzed immediately?
    A. To help prevent larger issues from arising
    B. To penalize employees for mistakes
    C. To increase employee work hours
    D. To decrease the time spent on decision-making
    Answer: A

  4. What can happen if corrective action is delayed in the controlling process?
    A. It can lead to increased motivation among employees
    B. It can result in prolonged performance gaps and inefficiency
    C. It can increase employee loyalty
    D. It can enhance departmental coordination
    Answer: B

  5. In case of a significant deviation, what might a manager do if it cannot be corrected through action?
    A. Terminate employees
    B. Revise the standards to reflect the new situation
    C. Wait for the deviation to self-correct
    D. Increase employee workloads
    Answer: B

Set 15: Limitations of Controlling

  1. What is one limitation of controlling in organizations?
    A. It guarantees that external factors such as government policies are under control
    B. It is often costly and time-consuming
    C. It is impossible to set clear standards for performance
    D. It always provides instant solutions to problems
    Answer: B

  2. Which of the following is an example of a factor that cannot be controlled by the management in an organization?
    A. Employee morale
    B. Technological changes
    C. Production quality
    D. Sales targets
    Answer: B

  3. Which limitation of controlling refers to the difficulty in defining performance standards in certain areas?
    A. Resistance from employees
    B. Difficulty in setting quantitative standards
    C. Lack of managerial training
    D. High operational costs
    Answer: B

  4. Why might an employee resist a control system?
    A. Due to fear of corrective actions
    B. Because the control system rewards good performance
    C. Because the standards set are too easy to achieve
    D. Due to clear and transparent communication from management
    Answer: A

  5. What is a potential problem faced by small organizations when implementing a control system?
    A. Insufficient resources to establish the system
    B. Over-reliance on employee performance reports
    C. Excessive use of modern control techniques
    D. Lack of experienced management personnel
    Answer: A

Set 16: Importance of Control in Organizational Success

  1. Why is controlling essential for achieving organizational goals?
    A. It helps to create new policies
    B. It ensures resources are used effectively and efficiently
    C. It eliminates the need for planning
    D. It focuses only on external factors
    Answer: B

  2. Which of the following is a benefit of a good control system in achieving organizational goals?
    A. It keeps the organization on the right track by measuring progress and correcting deviations
    B. It only focuses on monitoring employee performance
    C. It decreases the overall productivity of the organization
    D. It helps to avoid planning activities
    Answer: A

  3. How does controlling help in improving employee morale?
    A. By setting unclear standards for performance
    B. By ensuring employees are aware of the standards and expectations they need to meet
    C. By avoiding any form of feedback or evaluation
    D. By allowing employees to work independently without monitoring
    Answer: B

  4. In which of the following areas is controlling most beneficial for an organization?
    A. Setting unrealistic goals for employees
    B. Tracking performance and correcting deviations to ensure efficiency
    C. Minimizing the importance of planning
    D. Ignoring the external market factors
    Answer: B

  5. Which is a key feature of controlling that helps in ensuring order and discipline within the organization?
    A. Promoting individual goals over organizational goals
    B. Minimizing the need for planning
    C. Creating an atmosphere of accountability by monitoring progress and actions
    D. Ignoring deviations and not taking corrective actions
    Answer: C

Set 17: Standard Setting and Performance Measurement

  1. What makes the comparison of actual performance easier in a control system?
    A. Setting standards in quantitative terms
    B. Setting vague and abstract standards
    C. Ignoring actual performance and focusing only on results
    D. Relying on subjective evaluations from managers
    Answer: A

  2. Which of the following is an example of a quantitative performance standard?
    A. The overall satisfaction level of employees
    B. The number of units produced by a worker in a specified period
    C. Employee motivation index
    D. Customer service feedback
    Answer: B

  3. Why is it important for a manager to set precise quantitative standards?
    A. It simplifies the measurement of actual performance
    B. It makes the evaluation process subjective
    C. It helps to motivate employees without measuring their actual output
    D. It creates confusion in the comparison of results
    Answer: A

  4. What is an essential characteristic of effective performance standards in an organization?
    A. They should be flexible and adaptable to changing conditions
    B. They should be based solely on external market conditions
    C. They should remain unchanged for long periods
    D. They should be subjective and flexible based on managerial preferences
    Answer: A

  5. Which of the following methods is typically used to measure the performance of a company in controlling?
    A. Using random sampling and feedback
    B. Relying solely on intuition and manager decisions
    C. Utilizing performance reports and various ratios like ROI and net profit ratio
    D. Measuring employee satisfaction alone
    Answer: C

Set 18: Control in Different Organizational Levels

  1. Who is responsible for performing the controlling function in an organization?
    A. Only top-level managers
    B. Only lower-level managers
    C. Managers at all levels, from top to lower management
    D. Only external consultants
    Answer: C

  2. Which level of management uses controlling to ensure activities align with organizational goals?
    A. Only middle management
    B. Only top management
    C. All levels of management, including top, middle, and lower levels
    D. Only lower management
    Answer: C

  3. Which of the following is true about controlling at the lower levels of management?
    A. Lower-level managers do not need to control activities
    B. Controlling is only a concern for top-level managers
    C. Lower-level managers must control day-to-day operations and ensure they meet standards
    D. Lower-level managers focus only on strategic planning and ignore controlling
    Answer: C

  4. How does controlling at the middle management level differ from controlling at the top level?
    A. Middle management focuses on setting broad strategic goals, while top management manages operations
    B. Middle management controls day-to-day activities and operations, while top management handles strategic decisions
    C. Top management focuses only on corrective actions, while middle management sets policies
    D. There is no difference between the controlling roles of middle and top management
    Answer: B

  5. At the top management level, controlling involves: A. Daily monitoring of individual employees
    B. Ensuring long-term goals and strategic objectives are achieved
    C. Setting standards for individual performance
    D. Evaluating employee satisfaction solely
    Answer: B

Set 19: Corrective Actions and Revisions

  1. When should a manager consider revising the performance standards?
    A. When the performance is within the acceptable deviation range
    B. When the deviation exceeds the permissible limit and cannot be corrected
    C. When the employee's performance is excellent
    D. When the company experiences growth in sales
    Answer: B

  2. What is the primary reason for taking corrective action in a control system?
    A. To punish employees who fail to meet expectations
    B. To eliminate all forms of deviation, regardless of their significance
    C. To bring actual performance back in line with established standards
    D. To focus solely on long-term planning activities
    Answer: C

  3. Which of the following would be an example of corrective action in a manufacturing plant?
    A. Increasing the production target despite low output
    B. Hiring more workers without evaluating current performance issues
    C. Providing additional training for employees who are not meeting production targets
    D. Ignoring the underperformance and focusing on future goals
    Answer: C

  4. When is it necessary for a manager to revise the standards in a control system?
    A. When performance is consistently above the standards
    B. When it becomes evident that the standards are unrealistic or unachievable under current conditions
    C. When employees exceed their targets
    D. When corrective actions consistently fail
    Answer: B

  5. What is the role of corrective action when a deviation from the standard occurs?
    A. To ignore the deviation and continue with the current plans
    B. To immediately adjust the company's strategic goals
    C. To analyze the causes of the deviation and take appropriate actions to correct it
    D. To increase resources without any analysis of the problem
    Answer: C

Set 20: Challenges in Implementing Control Systems

  1. What is one of the main challenges faced in setting performance standards for employees?
    A. Overestimating employee capabilities
    B. Setting standards that are not measurable or quantifiable
    C. Rewarding employees for achieving non-quantitative goals
    D. Limiting feedback from employees
    Answer: B

  2. Which of the following is a common resistance to a control system from employees?
    A. High levels of transparency and feedback
    B. Feeling micromanaged or restricted in their actions
    C. Clear and attainable performance targets
    D. Positive reinforcement for meeting standards
    Answer: B

  3. Why might a small organization find it difficult to implement an effective control system?
    A. It lacks the financial resources to set up expensive control mechanisms
    B. It does not have a structured hierarchy for monitoring performance
    C. It has too many managers involved in the process
    D. It has excessive funds allocated to monitoring and controlling activities
    Answer: A

  4. Which of the following is an example of external factors that may limit the effectiveness of an organization's control system?
    A. Employee job satisfaction
    B. Competition and changes in government regulations
    C. Managerial training and skill levels
    D. Internal communication strategies
    Answer: B

  5. What is a key challenge for managers in implementing control systems?
    A. Ensuring that control systems are too rigid to allow flexibility
    B. Ensuring employee participation in decision-making
    C. Ensuring the control system is too simple to detect significant deviations
    D. Balancing the cost of control systems with the benefits they provide
    Answer: D

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