Aspen Stewart Is One of Five Sales Managers at a Sports

question 51

Multiple Choice

Aspen Stewart is one of five sales managers at a sports equipment company.She and the other sales managers are under pressure from management to keep their teams of sales representatives motivated and hitting their sales quotas.Because of that,Aspen has studied psychology and motivation,and is always looking for better ways to motivate her team.
-Each year,Aspen and the other sales managers meet with the director of sales to reevaluate the compensation plan for sales representatives.Last year they decided that the compensation plan they'd had--commission with a draw provision--was tempting the sales representatives to compete too hard with each other and cross ethical lines.To maintain some healthy competition but encourage the sales representatives to act in the company spirit,the group decided to try compensating sales representatives by:

• A)straight commission
• B)commission with a draw provision
• C)commission with a guaranteed salary
• D)commission with a draw provision plus bonus
• E)straight salary

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Definitions:

Warranty Work

Repair or replacement services performed for customers at no charge, covered under a product's warranty period to ensure satisfaction and compliance with standards.

Production Costs

The total cost incurred by a business to manufacture a product, including labor, materials, and overhead expenses.

Finished Goods

Products that have completed the manufacturing process but have not yet been sold or distributed to the end customer.

Activity Costs

Expenses associated with specific business activities, often analyzed in activity-based costing to determine product or service profitability.