Which of the Following Organizational Policies Is Most Likely to Result

question 100

Multiple Choice

Which of the following organizational policies is most likely to result in undesirable managerial behavior? (CMA adapted)

• A) Raj Chemicals sponsors television coverage of cricket matches between national teams representing India and Pakistan. The expenses of such media sponsorship are not allocated to its various divisions.
• B) Felix Eagle, the chief executive officer of Eagle Rock Brewery, wrote a memorandum to his executives stating, "Operating plans are contracts and they should be met without fail."
• C) The budgeting process at Lawrence Manufacturing starts with operating managers providing goals for their respective departments.
• D) Gallen Lighting holds quarterly meetings of departmental managers to consider possible changes in the budgeted targets due to changing conditions.

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Definitions:

Par Value

The face value of a bond or stock, representing the amount that will be returned to the holder at maturity, often used as a legal face value for stocks.

Installment Note

A debt instrument that requires a series of periodic payments of both principal and interest until the debt is paid in full.

Journal Entry

A record in the books of accounts that documents a financial transaction, showing the debit and credit effects.

Interest Expense

Costs incurred by an entity for borrowed funds, which are typically reported on the income statement within the financing or operating sections.