Worldatwork c8 60 Exam Practice Test Instant Access

Question 1

What best describes an effective core technique for communicating with executives?

AFocus on negative issues first, such as compensation costs exceeding budget, to get their attention

BProvide a wide range of facts and figures. With their high level of responsibility, executives must have all the data before they can make informed decisions.

CAssume they have little knowledge of the issue and make a detailed presentation leading up to the purpose of the meeting.

DRecommend a solution that will solve the issue and explain why it is the best solution available.

Answer : D

Question 2

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?

A500,000

B840,000

C8,000,000

D9,700,000

Answer : D

Question 3

What do working capital metrics evaluate?

AThe change in working capital over a specific period of time, typically one year

BA company's efficiency in converting short-term capital into cash

CA company's mean capital expenditure per employee

DThe amount of cash needed to meet the company's short-term obligations

Answer : B

Question 4

The ''return'' represented by the Total Shareholder Return (TSR) metric is the increase in what?

AEarnings

BShares

CMarket capitalization

DIncreased market value and reinvested dividends paid

Answer : D

Question 5

Gross margin is which of the following, as percent of revenue?

ARevenue minus cost of goods sold

BExpenses plus taxes and depreciation

CGross profit minus expenses

DCost of goods sold

Answer : A

Question 6

What metric should compensation professionals pay closest attention to for ensuring alignment between the compensation strategy and the HR and business strategies?

AVariable pay costs as a percent of total compensation

BTotal compensation expense for the business, including base pay and variable pay

CReward costs as a percent of total operating costs

DThe organization's market compa-ratio

Answer : C

Question 7

In what stage of the business lifecycle do companies typically begin standardizing procedures through policy creation?

AStart-up

BGrowth

CMature

DDecline

Answer : B

Worldatwork c8 Business Acumen for Compensation Professional 60 Exam Practice Test