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WorldatWork Regulatory Environments for Compensation Programs Sample Questions:

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

A) Maintenance
B) Audit fees
C) Rent
D) Shipping

2. To qualify for the executive exemption from the minimum wage and overtime provisions of the FLSA, among other things what must an employee do?

A) Customarily and regularly direct the work of at least two full-time employees
B) Perform work that is intellectual and varied
C) Possess knowledge of an advanced type in business administration
D) Devote less than 15% of his/her time to nonexempt work

3. What best describes the primary purpose of budgeting?

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

4. Which of the following best describes a form of base pay that is a fixed weekly, biweekly or monthly payment?

A) Hourly rate
B) Salary
C) Bonuses
D) Piece rate

5. What is the most accurate statement regarding forecasting?

A) It uses internal and external factors to help answer questions about business expectations for the future.
B) It is done primarily by evaluating market conditions and economic indicators.
C) It is done primarily by using historical revenue and expense data.
D) It is a precise estimate of what the future holds for the organization.

Solutions: