Delegating Greater Authority to Subordinate Managers and Employees

question 39

Multiple Choice

Delegating greater authority to subordinate managers and employees:

• A) creates a more horizontal or flatter organizational structure with fewer management layers and usually acts to shorten organizational response times.
• B) usually slows down decision making because so many more people are involved and it takes longer to reach a consensus on what to do and when to do it.
• C) can be a de-motivating factor because it requires people to take responsibility for their decisions and actions.
• D) is very,very risky because it usually results in lots of "bad" decisions on the part of employees,as well as lower levels of financial performance.
• E) enhances greater cross-unit coordination and aids the capture of strategic fit benefits across related businesses.

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Definitions:

Written Off

The accounting action of declaring that an asset has become worthless or a debt is uncollectible and recognizing it as a loss.

Bad Debt Expense

An expense reported on the income statement, representing the estimated amount of receivables that a company does not expect to collect.

Allowance Method

An accounting technique used to estimate and account for potential uncollected debts or credit losses in financial statements.

Uncollectible Receivables

Financial debts owed to a company that are deemed uncollectible and written off as a loss.