Oswald & Rutabaga,CPAs,brought in an HR Consulting Firm to Evaluate

question 38

Multiple Choice

Oswald & Rutabaga,CPAs,brought in an HR consulting firm to evaluate the firm's performance management system.The firm has offices in six locations,and the manager of each location rates the office's staff members using a 5-point rating scale.After studying the appraisal results from the past three years,the consultants reported that they cannot make comparisons among the offices.Which of the following is the most likely problem?

• A) The consultants aren't qualified to analyze this type of rating system.
• B) One office has exceptional people,so contrast errors are occurring.
• C) The managers let their opinion of one quality color their opinion of others.
• D) The managers are making distributional errors,each using only part of the rating scale.
• E) The managers tend to give higher ratings to people they consider similar to themselves.

---

Definitions:

Assets Sold

Items of value or resources owned by a company that have been disposed of or sold to another party.

Deficit

Amount by which net income falls short of salary and interest allowance. Also an abnormal, or debit, balance in a partner’s capital account.

Post-closing Account Balances

The financial position of accounts after all adjustments, including closing entries, have been made at the end of an accounting period.

Non-cash Assets

Items of value that a company owns but cannot be easily converted to cash, such as real estate, equipment, and patents.