Saudi Electronic University HCM 213 Chapter 11 Multiple Choice 1)Decentralization is: A major type of responsibility centered within an organization The degree of dispersion of responsibilities The compounding for any given interest Proceeds lost by forgoing other opportunities Advantages of decentralization include: Loss of control Decreased goal congruence Greater speed Lack of managerial talent Disadvantages of decentralization include: Increased need for condition and formal communication More efficient use of time More relevant information Higher quality decisions Types of responsibility centers include all but one of the following: Service centers Profit centers Cost centers Managerial talent centers Measures of performance responsibility centers include: Responsibility Authority Accountability All of the above Budget variances are: A result of positive revenues The difference between what was budgeted and what actually occurred A budget that accommodates a range of activities A tangible asset pledged to repay a loan Common variances used by health care organizations include Revenue variance Traditional profit center Expense variance a & c Budget variances associated with short term strategies include Revenue enhancement Cost containment Revenue attainment b & c Common complications when using measures to judge financial performance include: Loss of control Greater speed Promotion of short term thinking Efficient use of time Major employee compensation model which of the following advantages: Income predictability At risk distribution Income contingent on uncontrollable forces No financial incentives True or False The degree of decentralization has to balance the advantages and disadvantages within a healthcare organization

Question

Saudi Electronic University

1. A major type of responsibility centered within an organization
2. The degree of dispersion of responsibilities
3. The compounding for any given interest
4. Proceeds lost by forgoing other opportunities
Advantages of decentralization include:
1. Loss of control
2. Decreased goal congruence
3. Greater speed
4. Lack of managerial talent
Disadvantages of decentralization include:
1. Increased need for condition and formal communication
2. More efficient use of time
3. More relevant information
4. Higher quality decisions

Types of responsibility centers include all but one of the following:
1. Service centers
2. Profit centers
3. Cost centers
4. Managerial talent centers
Measures of performance responsibility centers include:
1. Responsibility
2. Authority
3. Accountability
4. All of the above
Budget variances are:
1. A result of positive revenues
2. The difference between what was budgeted and what actually occurred

1. A budget that accommodates a range of activities
2. A tangible asset pledged to repay a loan
Common variances used by health care organizations include
1. Revenue variance
2. Traditional profit center
3. Expense variance
4. a & c
Budget variances associated with short term strategies include
1. Revenue enhancement
2. Cost containment
3. Revenue attainment
4. b & c
Common complications when using measures to judge financial performance include:
1. Loss of control
2. Greater speed
3. Promotion of short term thinking
4. Efficient use of time
Major employee compensation model which of the following advantages:
1. Income predictability
2. At risk distribution
3. Income contingent on uncontrollable forces
4. No financial incentives

True or False

The degree of decentralization has to balance the advantages and disadvantages within a healthcare organization. True or False?

The result of a favorable variance is less income received than budgeted. True or False?

Budget variance measures that are long term promote revenue enhancement. True or False?

Cost centers are responsible for providing services and controlling their costs. True or False?

At risk compensation system is based totally on achieving performance goals. True or False?