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

What do working capital metrics evaluate?

A. The change in working capital over a specific period of time, typically one year

B. A company's efficiency in converting short-term capital into cash

C. A company's mean capital expenditure per employee

D. The amount of cash needed to meet the company's short-term obligations

How do quarterly reports most commonly compare to the annual report?

A. The cumulative information on the four quarterly reports adds up to the information on the annual report.

B. The quarterly reports are more detailed. The annual report provides similar data in summary form.

C. The annual report is required and the quarterly reports, while commonly used, are optional.

D. The quarterly reports are not as detailed as annual reports, and might not match due to changing accounting estimates over the year.

Which of the following best describes the guiding principles and/or beliefs shared by stakeholders in an organization?

A. Mission

B. Vision

C. Values

D. Strategy

What information is found on the balance sheet?

A. A list of what is owned, what is owed and the equity of an entity

B. The revenues and expenses incurred by an entity over a period of time

C. The change during the reporting period in cash and cash equivalents

D. The profitability of the company as of a specific date