C8 Online Practice Questions and Answers

What is the term for the skills, technologies, applications and practices of continuous iterative exploration and investigation of past business performance used to gain insight and drive business planning?

A. Business forecasting

B. Business analytics

C. Predictive modeling

D. Statistical analysis

Your company has had a strong fiscal year with a 15% increase in net income over the prior fiscal year. Share prices are at an all time high. Working with Finance, you have arrived at a 2.5% merit increase budget for the next fiscal year, a smaller increase than the last fiscal year. Finance has indicated that some large capital expenditures will be needed next year, so the company needs to conserve resources. Additionally, Legal is in final negotiations on a lawsuit that may be very costly to the company. Word of the smaller increases has line management concerned that they will lose their best performers. Given all of these factors, what is your best course of action?

A. Implement the merit increase budget as is because the anticipated financial obligations have made it necessary

B. Meet with Finance and make a case for a larger merit increase budget because the loss of key talent will cost more over the long term than the savings from the smaller merit increases

C. Gather the perspectives of all stakeholders, analyze their individual concerns and meet to determine whether a compromise solution is possible

D. Recommend a reduction in force to eliminate poor performers, which will increase the merit budget by reducing headcount

Regarding fixed and variable costs, what tends to happen as revenue increases?

A. Variable costs decrease

B. Fixed costs decrease

C. Variable costs increase and consume a higher percent of revenue

D. Fixed costs remain the same and consume a lower percent of revenue

What best describes a key competency of compensation professionals regarding HR management of the organization's employees?

A. Ensuring they are appropriately selected, developed, appraised and rewarded

B. Monitoring individual employee career paths and succession planning

C. Communicating regularly with line management on performance management

D. Ensuring that all regulatory and voluntary payroll deductions are properly administered

Which financial statement or combination of statements provide(s) the most comprehensive view of the company's financial situation?

A. The balance sheet

B. The income statement

C. The cash flow statement and the income statement

D. The cash flow statement, along with the balance sheet and income statement

The XYZ Company opened a new manufacturing facility with a capital investment of 10,000,000. The cost to obtain the capital was 8%. In its first year of operations, the facility's net operating profit after taxes was 10,500,000. What was the economic value added (EVA) using the EVA formula?

A. 500,000

B. 840,000

C. 8,000,000

D. 9,700,000

The Delta Company has experienced increased turnover in the past two years. Data from exit interviews indicate that most of those leaving did so for better opportunities and higher compensation. If Delta pays at the highest percentile of the market for their peer group, what data analysis should they do?

A. Additional quantitative analysis to determine whether pay rates are truly competitive or existing data are unreliable

B. Qualitative data collection to talk to key stakeholders and employees and determine whether the exit interviews accurately reflect their concerns

C. Qualitative data collection in the form of an employee survey with questions about employee satisfaction with pay levels

D. No additional data analysis is needed. Delta should increase pay rates based on the existing data to decrease turnover.

The "Value Store" retail company offers its customers low prices and ease of purchase by minimizing waste and striving for high efficiency. What strategy is the "Value Store" using?

A. Operational excellence

B. Product/service leadership

C. Customer intimacy

D. Brand loyalty

What best describes what forecasting helps the organization to do?

A. Recognize possible issues and concerns that will drive budget planning

B. Prepare quarterly and annual reports and their associated statements

C. Withhold payroll taxes for all elements of compensation

D. Anticipate future capital needs by determining when the organization will enter the next phase of the business lifecycle

What is the most accurate statement regarding the effect of compensation plans on the organization?

A. They typically have the greatest effect on net income and operating results of any organizational expense or program

B. Their success or failure is closely tied to the success or failure of organizationwide goals and objectives

C. They have very little effect as long as they are managed effectively and efficiently

D. They affect the organization's overall financial status and impact multiple stakeholders across most, if not all, business units