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WorldatWork Regulatory Environments for Compensation Programs Sample Questions:

1. What type of equity incentive gives employees the right to purchase company shares at a specified price?

A) Stock/share grants
B) Stock/share options
C) Performance units
D) Restricted stock/shares

2. What best describes what forecasting helps the organization to do?

A) Recognize possible issues and concerns that will drive budget planning
B) Anticipate future capital needs by determining when the organization will enter the next phase of the business lifecycle
C) Withhold payroll taxes for all elements of compensation
D) Prepare quarterly and annual reports and their associated statements

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

A) Variable costs decrease
B) Fixed costs remain the same and consume a lower percent of revenue
C) Variable costs increase and consume a higher percent of revenue
D) Fixed costs decrease

4. The Alpha company ships an order to a customer on March 1st and invoices the customer for the product with the shipment, with payment terms of net 30 days. The customer's payment is received on April 5th. The payment clears the bank and shows on Alpha's account on April 8th. If Alpha is using accrual accounting, when does it record the revenue for this sale?

A) March 1st
B) April 8th
C) March 31st
D) April 5th

5. To establish disparate treatment in violation of Title VII of the Civil Rights Act of 1964, an employee must prove that the employer intentionally maintains the pay disparity because the employee is a member of a protected class and which of the following?

A) He or she is paid less than employees who are not members of the same protected group.
B) The employer maintains a wage disparity between employees who do unequal, but comparable work.
C) He or she receives a lower wage than a co-worker of the opposite sex.

Solutions: