A Sales Manager Has Implemented a Programme for His Salespeople

question 82

Multiple Choice

A sales manager has implemented a programme for his salespeople that involves a meeting with each salesperson, during which the sales manager gives the salesperson the yearly quota for the salesperson's territory.The sales manager has missed the key concept in management by objectives, which is

• A) reducing the paperwork involved in the MBO process.
• B) a mutual understanding of the punishment to be given if the salesperson does not meet the goal set by the sales manager.
• C) mutual goal setting between the sales manager and the salesperson.
• D) documentation of the sales quota in the salesperson's personnel file.
• E) ensuring that the economy can support the sales quota assigned.

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Definitions:

Direct Materials

Raw materials that are directly traceable to the production of specific goods or services and are an integral part of the finished product.

Variable Factory Overhead

Variable factory overhead consists of production costs that vary with the level of output, such as utilities and indirect materials.

Fixed Costs

Costs that tend to remain the same in amount, regardless of variations in the level of activity.

Differential Revenue

The additional revenue generated from choosing one alternative over another in decision-making processes.