The Compa-Ratio

question 31

Multiple Choice

The compa-ratio:

• A) measures the degree to which actual pay is consistent with the pay policy.
• B) is defined as average pay for the grade divided by the minimum pay for the grade.
• C) can range from 0 to 100 percent.
• D) uses data from market-pay surveys.
• E) measures the degree to which new skills learnt are consistent with the increases in pay.

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Definitions:

Dividend Reinvestment Scheme

A plan offered by a corporation that allows investors to reinvest their cash dividends by purchasing additional shares or fractional shares on the dividend payment date.

Cash Equivalents

Short-term, highly liquid investments that are readily convertible to known amounts of cash and close to their maturity.

Basis of Measurement

The specific basis chosen to measure various types of assets, liabilities, income, and expenses, such as historical cost, fair value, and amortized cost.

Accrual

An accounting method that records revenues and expenses when they are incurred, regardless of when cash transactions occur.