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WorldatWork Regulatory Environments for Compensation Programs Sample Questions:

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

A) Expenses plus taxes and depreciation
B) Revenue minus cost of goods sold
C) Cost of goods sold
D) Gross profit minus expenses

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

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

3. Which of the following acts is focused on employers with construction contracts with the government?

A) Davis-Bacon Act
B) McNamara-O'Hara Act
C) National Labor Relations Act
D) Sherman Antitrust Act

4. What happens to the marginal cost if revenue accelerates slower than variable costs but fixed costs remain the same?

A) It remains the same.
B) It increases at the same rate as variable costs.
C) It becomes increasingly higher as revenues increase.
D) It decreases because variable costs are increasing.

5. Regarding presentations to executives, which of the following is most accurate?

A) Use multiple media
B) Leave backup data out of the presentation so there is time to develop an effective response to unexpected questions
C) Keep them brief
D) Include all details related to the issue

Solutions: