Llf Fundamentals Of Financial
15th Edition
ISBN: 9781337395267
Author: Brigham
Publisher: CENGAGE LEARNING - CONSIGNMENT
expand_more
expand_more
format_list_bulleted
Question
Chapter 1, Problem 13Q
Summary Introduction
To identify: The criteria used for setting compensation for divisional managers and CEO would be same or different.
Compensation Package: The compensation package of should structured in that way which seems attractive and to perform actively. If the compensation package is good, the manager will focus on the maximization of stockholders value. The compensation package should be fair.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Corporate managers work for the owners of the corporation. Consequently, they should make decisions that are in the interests of the owners, rather than in
their own interests. What strategies are available to shareholders to help ensure that managers are motivated to act this way?
Shareholders can do the following: (Select all the choices that apply.)
A. Ensure that employees are paid with company stock and/or stock options.
B. Write contracts that ensure that the interests of the managers and shareholders are closely aligned.
C. Mount hostile takeovers.
D. Ensure that all employees are paid a percentage of the company's revenue
E. Ensure that underperforming managers are fired.
Discuss the advantages and disadvantages of the following forms of managerial compensation in terms of mitigating agency problems, that is, potential conflicts of interest between managers and shareholders.a. A fixed salary.b. Stock in the firm that must be held for five years.c. A salary linked to the firm’s profits.
Assume you have been hired by Hilton Hotels and Resorts. As part of your new role in the accounting department, you have been tasked to set up a responsibility accounting structure for the company. As your first task, your supervisor has asked you to give an example of a cost center, profit center, and an investment center within the Hilton organization. Your supervisor is a little unsure of the difference between a profit center and investment center and would like you to explain the difference.
Chapter 1 Solutions
Llf Fundamentals Of Financial
Knowledge Booster
Similar questions
- In each of the following situations, identify which type of responsibility center is appropriate based on the decision-making authority the manager would possess: 1. The manager of the accounting department in Ford’s corporate office. 2. The sales manager of a Ford dealership. 3. The general manager of a Ford dealership. 4. The manager of Ford’s corporate division. 5. The production manager in a Ford plant. options: Cost Center Investment Center Profit Center Revenue Centerarrow_forwardCEO duality refers to a situation in which the CEO formulates and implements strategies.the CEO serves as both the CEO and the chair of the board of directors. the CEO is responsible for acting as CEO and serving on the compensation committee. the CEO is responsible for acting as CEO and Chief Operating Officer (COO).arrow_forwardHow does the concept of responsibility accounting contribute to organizational accountability? If you have experiences from previous jobs, you can share those. Otherwise, find examples from companies through internet research, or share your insight on why you think this may matter. Responsibility accounting involves assigning specific financial responsibilities to managers or departments. This system tracks and evaluates performance based on how well these individuals or units adhere to their budgets and financial goals. It ensures that each manager or department is accountable for the financial results of their decisions and operations. By assigning specific financial responsibilities to individuals or departments, responsibility accounting makes it clear who is accountable for what. This clarity helps managers focus on their areas of responsibility and understand the direct impact of their decisions. This system allows for more precise performance evaluation. Managers are assessed…arrow_forward
- dear tutor, kindly assist me to answer this question. management accounting subjectarrow_forwardThoroughly explain job responsibilities, leadership roles, and the impact this position has on the organization for a CFO position. Please provid specific information about the position such as: who the financial leader will report to, essential duties and responsibilities, competencies, education, and experience requirements.arrow_forwardAs a managerial accountant, you would have the opportunity to work for company that classifies itself as either service, merchandising, or manufacturing.Based on what you have learned from this unit, and based on your personal preferences, identify which type of company for which you would prefer to work as a managerial accountant. Be sure to provide specific reasoning to support your answer.arrow_forward
- Types of decisions that managers make include all of the following except: a.choosing which products to sell b.designing performance evaluation systems c.setting tax rates d.hiring employees e.All of these are decisions that managers makearrow_forward1. what are the duties and responsibilities of Accountant jobs? 2. what are the most important personality characteristics needed for those Accountant jobs?. 3. what are the selection processes (type of test and interviews) used to choose the right person for the Accountant jobs?arrow_forwardThe controller of one division of a large diversified firm is compensated by salary plus bonus. The bonus is a significant part of total compensation, and is based directly on the profits of the division. Thus, the controller has an incentive to find ways to increase profits, including the delay of discretionary expenses such as research and development, delay of maintenance and repair of manufacturing equipment, and delay of sales promotions. Required: Is finding ways to increase profits as described above unethical? Why or why not? Who is to blame if anyone?arrow_forward
- Explain some of the basic assumptions of CVP analysis and why this is used in managerial accounting? Why do management accountants use sensitivity analysis and provide an example of how this would be used (use a real publicly traded company)?arrow_forwardAssume that you are a management accountant in a local firm. Your firm is thinking of establishing ethical guidelines for management accounting and you are assigned a task to draft these guidelines. the main ethical aspects of Credibility in management accounting that your local firm should have as guidelines.arrow_forwardAnswer the following case. (1) Identify and explain the corporate governance issues in each case. Support your answer with appropriate theory(s) if any. (2) Give recommendations and justify them to the board of directors. A. XYZ is a limited company operating in the steel industry. Its board of directors consist of nine independent directors, labor union representative director and nominee directors to represent major shareholders and lenders. The board is controlled by dominant directors. Mr. Smith is the independent chair of the board. Mr. John is one of the nominee directors and the husband of the CFO of XYZ. During 2020, the company started to face some financial problems. The board members were not informed with the situation. Mr. John came to know about these problems and advised his major shareholder to sell his shares.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Fundamentals of Financial Management (MindTap Cou...FinanceISBN:9781337395250Author:Eugene F. Brigham, Joel F. HoustonPublisher:Cengage Learning
Fundamentals of Financial Management (MindTap Cou...FinanceISBN:9781285867977Author:Eugene F. Brigham, Joel F. HoustonPublisher:Cengage Learning
Fundamentals Of Financial Management, Concise Edi...FinanceISBN:9781337902571Author:Eugene F. Brigham, Joel F. HoustonPublisher:Cengage Learning
Fundamentals of Financial Management, Concise Edi...FinanceISBN:9781285065137Author:Eugene F. Brigham, Joel F. HoustonPublisher:Cengage Learning
Fundamentals of Financial Management, Concise Edi...FinanceISBN:9781305635937Author:Eugene F. Brigham, Joel F. HoustonPublisher:Cengage Learning
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Fundamentals of Financial Management (MindTap Cou...
Finance
ISBN:9781337395250
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Fundamentals of Financial Management (MindTap Cou...
Finance
ISBN:9781285867977
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Fundamentals Of Financial Management, Concise Edi...
Finance
ISBN:9781337902571
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Fundamentals of Financial Management, Concise Edi...
Finance
ISBN:9781285065137
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Fundamentals of Financial Management, Concise Edi...
Finance
ISBN:9781305635937
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College