Which of the Following Forms of Payment Is NOT an Incentive

question 44

Multiple Choice

Which of the following forms of payment is NOT an incentive plan?

• A) Commission plans for salesmen
• B) Flat salary for a plant manager
• C) Bonuses for managers that increase as profits increase
• D) None of the statements is correct.

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Definitions:

Cash Dividend

A payment made by a company out of its earnings to shareholders, typically in the form of cash.

Shares Issued

The number of shares that have been allocated and are held by shareholders, including both public investors and company insiders or affiliates.

Treasury Stock

Stocks that have been initially distributed and then bought back by the company that issued them, thus decreasing the quantity of available shares in the market.

Contra Equity Account

An equity account where balances are opposite to the normal accounts and are used to reduce the value of equity accounts.