(Test Bank) Cost Management Measuring Monitoring And Motivating Performance

Eldenburg,Wolcott, 2

Business

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2nd Edition

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Test Bank for Cost Management Measuring Monitoring And Motivating Performance, The downloadable file consists of 561 pages, and the total size of the file is 3.59 MB. Purchase now only for highly discounted price.

Author(s): Eldenburg, Wolcott

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Chapter 1: The Role of Account ing Information in Management Decision Making Learning Objective True / False Multiple Choice Matching Exercises Short Answer Problems Q1: What types of decisions do managers make for an organization? 1-4 1-12 S: 59, 67 W: 78, 83, 84 1 6 Q2: What is the role of accounting information in management decision making? 5-9 13-20, 32 S: 60-62 W: 68-70, 80 3 3, 4 Q3: How do uncertainties and biases affect the quality of decisions? 10-13 21-30 W: 72, 73 2 1, 5, 7 1 Q4: How can managers make higher-quality decisions? 14-18 31, 34-44 S: 58 W: 71 2 4 Q5: What information is relevant for decision making? 19-22 45-51 S: 63-65 W: 74, 75, 77, 79, 81, 82 4 1 2 1, 2 Q6: What is ethical decision making, and why is it important? 23-25 52-57 S: 66 W: 76 5 S: Questions from the study guide W: Questions from web quizzes on the student web site Level of Complexity* True / False Multiple Choice Matching Exercises Short Answer Problems Foundation: Repeat or paraphrase information; Reason to single correct solution; Perform computations; etc. All All All All 6 2 Step 1: Identify the problem, relevant information, and uncertainties 1, 2, 5, 6, 7 1, 2 Step 2: Explore interpretations and connections 3, 4 1 Step 3: Prioritize alternatives and implement conclusions Step 4: Envision and direct strategic innovation *Based on level in Steps for Better Thi nking (Exhibit 1.10 , textbook p. 16): Note: Step 1, 2, 3, and 4 questions in this test bank are intentionally open-ended and subjective, giving students the opportunity to demonstrate skills such as judgment, reasoning, identification of uncertainties, identification or analysis of pros and cons, and so on. Therefore, student answer s may not exactly match those shown in the solutions. 1-2 Cost Management True / False 1. A vision statement is one way to clarify an organization’s basic purpose and ideology. 2. Most managers follow a standard template and format when writing a vision statement. 3. A vision statement helps employees understand how to deal with various stakeholder groups. 4. Organizational core competencies are the tactics th at managers use to take advantage of the vision. 5. Accounting information is the only thing ma nagers need to make financial decisions. 6. Accounting information is used to monitor operati ons by comparing actual results to planned results. 7. Accounting information cannot be used to motivate employee behavior. 8. Cost accounting information is used for both external reporting and internal decision making. 9. Cost accounting information, such as the valua tion of ending inventory, is shown on external financial statements. 10. Because accounting information is highly objective and quantitative in nature, it is not subject to uncertainties or management bias. 11. Uncertainty and bias reduce decision quality. 12. Uncertainties cause decision makers to ignor e weaknesses in a preferred course of action. 13. Uncertainties and biases do not affect external financial reports, because they are based on objective standards. 14. Because we can never completely remove biases and uncertainty from decision making, higher quality decision processes are often imprecise. 15. Higher quality decisions result from higher qua lity information, reports, and decision making processes. 16. Few management decisions can be made with absolute certainty. 17. Open-ended problems are not often seen in business. 18. When learning cost accounting, it is sufficient to learn the mechanics of applying cost accounting methods. 19. Incremental cash flows are relevant for decision making. 20. Incremental cash flows are the same as unavoidable cash flows. 21. Relevant information for decisions can focus both on learning from the past and anticipating the future. 22. The cost of your old automobile is relevant in the decision to purchase a new automobile. 23. Ethical behavior is an individual obligat ion, but not an organizational obligation. 24. Employees will always make ethical decisions if they act in the best interests of shareholders. 25. Ethical behavior is required of ev ery employee within an organization. Chapter 1: The Role of Accounting Info rmation in Management Decision Making 1-3 Multiple Choice 1. Which of the following influe nces organizational strategies? a. Organizational vision b. Financial statement results c. Computer software d. Number of employees 2. Which of the following statements regarding organizational vision is false? a. Organizational vision means the same as core competencies b. Organizational vision is one tool fo r expressing an organization’s main purpose c. Organizational vision should be communicated to all employees d. Managers sometimes divide the organizational vision into one or more written statements 3. An organizational vision is sometimes broken down into I. Mission statement II. Core values statement III. Code of conduct a. I only b. I and II only c. I, II, and III d. II and III only 4. Organizational core competencies can include a. A mission statement b. Patents, copyrights and special legal protections c. A code of conduct d. An operating plan 5. How are organizational strategies related to core competencies? a. Competencies are the tactics managers use to take advantage of strategies b. Competencies and strategies are an integral part of organizational vision c. Strategies help managers exploit competencies d. Strategies and competencies are actually two ways of expressing the same idea 6. Organizational strategies a. Are reconsidered on a daily basis b. Should never be reconsider ed once they are determined c. Are reconsidered quarterly d. Are reconsidered periodically in response to changes in the organization or environment 7. Which of the following is an element of an operating plan? a. Developing an organizational mission b. Preparing financial statements c. Defining core values d. Budgeting employee costs Use the following information for the next 5 questions: Maude is considering opening her own business, now that she has retired from her regular job. Her business idea is a reminder and shopping service, in which clients submit lists of birthdays, anniversaries and other important dates. Maude sends her clie nts reminders for those dates, and shops for special gifts at the client’s request. She plans to do all of the work herself rather than hiring and managing additional employees. 1-4 Cost Management 8. “Providing excellent, reliable customer servi ce at reasonable prices” best describes which of the following for Maude’s business? a. Core competency b. Vision c. Operating plan d. Actual operations 9. Maude’s core competencies are most likely to include a. An annual budget b. The ability to deduct business expenses on her tax return c. The first year’s actual results d. Her knowledge of potential gifts and the local shops 10. Maude’s organizational strategy is most likely to include a. Her knowledge of local stores b. Operating her business from her home to keep costs low c. Leasing equipment d. Mailing flyers to potential clients 11. Maude’s actual operations would probably include a. Establishing a sales strategy b. Purchasing advertisements in local media c. Identifying her core competencies d. Developing a budget 12. Which of the following statements is true fo r Maude’s business regarding measuring and monitoring performance? a. Maude does not need a system to measure a nd monitor performance because her company is a sole proprietorship b. Maude needs audited financial statements every year c. Maude can track cash flows on a monthly basis d. Maude only needs to reconcile her accounts every few years 13. Accounting information I. Can be used to guide organizational vision II. Is a core competen cy for most companies III. Can be used to motivate performance a. I only b. I and II only c. I, II, and III d. I and III only 14. Cost accounting information is used for a. Financial reporting only b. Management reporting only c. Both financial and management reporting d. Neither financial nor management reporting 15. Which of the following is a type of external report produced by an organization’s information system? a. Cash flow plan b. Analysis of potential acquisition c. News release d. Bonus computations Chapter 1: The Role of Accounting Info rmation in Management Decision Making 1-5 16. Which of the following is least likely to be an external report? a. Credit report b. Supplier’s inventory report c. Tax return d. Analysis of supplier quality 17. Which of the following is the best example of an internal report that might come from an organization’s information system? a. Environmental Protection Agency regulatory report b. Operating budget c. Income tax returns d. Medicare cost report 18. Financial statements are a. External reports produced from an organization’s information system b. Never used for internal decision making c. Only true when they are audited d. Unimportant reports for most organizations 19. Information gathered outside the organization includes a. Customer preferences b. Product design specifications c. Taxable income d. Number of employees hired 20. Which of the following is not true about information in an organization’s databases? a. Information may be collected formally or informally b. Access to database information is of ten restricted to specific individuals c. Intellectual capital is usually captured in database information d. The benefits of generating information should exceed the costs 21. Uncertainties a. Are issues about which managers have doubts b. Do not impact accounting information, which is highly objective and reliable c. Are preconceived notions deve loped without careful thought d. Are rarely a problem in business decision making 22. Biases a. Are issues about which managers have doubts. b. Do not impact accounting information, which is highly objective and reliable c. Are preconceived notions deve loped without careful thought d. Are rarely a problem in business decision making 23. Alaska Airlines flies several non-stop flights dail y between Los Angeles and Vancouver. Which of the following is an uncertainty associated with this operation? a. The exact number of flights flown the previous day b. The average number of passengers on each flight the previous week c. The average number of empty seats for flights next month d. The number of ticket agents schedul ed for each shift for the next day 1-6 Cost Management 24. Marriott Corporation operates hotels all over the wo rld. Which of the following is the best example of a potential bias associated with its operations? a. Managers assume that most travelers are interested in conducting business, rather than vacationing b. Managers learn that guests ra rely stay longer than a week c. Managers find that last year’s profits were below the industry average d. Managers are concerned because employee turnover increased during the last year 25. Uncertainties and biases can affect I. Organizational vision II. Core competencies III. Operating plans a. I only b. II only c. I and III only d. I, II, and III 26. Which of the following statement about biases is true? a. Biases can affect management accounting info rmation, but not financial accounting information b. Managers cannot work toward eliminating their biases c. Biases reduce the quality of decisions d. Biased managers are more likely to expl ore alternatives before making a decision 27. Uncertainty may hinder a manager’s ability to: I. Adequately define a problem II. Identify all potential solution options III. Predict the outcome of various solution options a. I and III only b. II and III only c. I, II, and III d. II only 28. Biases may be a. Intentional b. Unintentional c. Both intentional and unintentional d. Beneficial to decision making 29. Biases a. Inhibit anticipating all future conditions b. Assist in the identifica tion of relevant information c. Do not affect the ability to identify irrelevant information d. Are not a problem in ethical decision making 30. Pet Snacks Company has 500 pounds of liver-fla vored dog biscuits that are not selling well. The selling price of the biscuits could be reduced from $3.00 to $2.50 per pound. Or, they could be cheese-coated and sold for $4.00 per pound; the a dditional processing cost w ould be $0.50 per pound. Cheese-coated biscuits sell very well. Which alternative probably has less uncertainty concerning volume of sales? a. Reduce the price of liver-flavored biscuits b. Proceed with the cheese coating c. Both alternatives are equally uncertain d. Uncertainty does not affect this decision Chapter 1: The Role of Accounting Info rmation in Management Decision Making 1-7 31. Managers can make higher-quality decisions by relying on all of the following except a. More complete information b. Better decision-making processes c. Irrelevant information d. Information having less uncertainty 32. How does the use of sophisticated informati on systems affect managerial decision making? a. Sophisticated information systems always improve managerial decision making b. Sophisticated information systems always provide better information c. Managers may overlook potential uncer tainties and bias in their information d. The cost of sophisticated information systems may exceed their benefit 33. Which of the following adjectives de scribes higher quality information? I. Complete II. Costly to develop III. Relevant a. I and II only b. II and III only c. I and III only d. I, II, and III 34. Higher quality reports are more I. Relevant II. Understandable III. Available a. I and II only b. I and III only c. II and III only d. I, II, and III 35. Higher quality decision making processes are less a. Biased b. Certain c. Creative d. Focused 36. The process of making higher quality business d ecisions requires each of the following except a. Distinguishing between releva nt and irrelevant information b. Recognizing and evaluating assumptions c. Considering organizational values and core competencies d. Relying on preconceived notions to make decisions more quickly 37. Which of the following statements about open-ended problems is true? a. Open-ended problems cannot be solved with absolute certainty b. It is not possible to find the best solution to an open-ended problem c. Only one possible solution is possible for an open-ended problem d. The best solution to an open-ended problem ensures the most favorable outcome 38. Why is it necessary to identify whether a problem is open-ended? a. Open-ended problems require less decision making effort than other types of problems b. Decision maker biases are not important when addressing open-ended problems c. More than one potential solution must be explored for open-ended problems d. Few management decisions are open-ended 1-8 Cost Management 39. Which of the following is least likely to be an open-ended problem? a. How to contribute as a team member b. Choice of career c. How to study for a course d. Identification of required courses for a college degree 40. John is creating next year’s budget for PDC Corpora tion. He estimates that next year’s sales volume will be 5% higher than this year and that the se lling price per unit will remain at $75 per unit. He estimates that cost of goods sold will be $40 pe r unit, based on a purchase agreement the company has signed with its supplier. The company has done business with the supplier for many years. In creating the budget, which of the following tasks is most likely to be open-ended? a. Calculating budgeted sales volume b. Determining that sales volume will grow by 5% c. Calculating budgeted cost of goods sold d. Determining that cost of goods sold per unit will be $75 per unit 41. Analyzing the strengths and weaknesses of di fferent alternatives includes all of the following except a. Recognizing and evaluating assumptions b. Drawing a conclusion about which alternative is best overall c. Gauging the quality of information d. Considering different viewpoints 42. Choosing and implementing a solution to a business problem includes I. Making trade-offs among alternatives II. Considering the organization’s strategies III. Motivating performance within the organization a. I only b. I and II only c. II and III only d. I, II, and III 43. Management decisions require monitoring over time for all of the following reasons except a. The economic environment may change b. New opportunities may become available c. To motivate employees to follow plans exactly, ev en if the plan results in poor performance d. Unforeseen threats may arise 44. Which of the following often prevents managers from adequately exploring information before making a decision? a. The existence of many uncertainties b. The need to distinguish between relevant and irrelevant information c. The managers’ biases d. The organization’s values 45. Irrelevant information may be I. Useful in decision making II. Internally-generated III. Accurate a. I only b. I and II only c. II and III only d. I, II, and III Chapter 1: The Role of Accounting Info rmation in Management Decision Making 1-9 46. Whether a given type of information is relevant or i rrelevant depends on a. Its accuracy b. Its objectivity c. Its relation to the decision to be made d. Whether it is cash-basis or accrual-basis 47. Relevant cash flows are a. Past cash flows b. Future cash flows c. Incremental cash flows d. Unavoidable cash flows 48. In a decision to lease or borrow money and build office space, which of the following is relevant? a. The interest rate for new funds b. The amount of space needed c. The number of employees curre ntly working for the company d. The personal preferences of the decision maker 49. Irrelevant cash flows are a. Avoidable b. Unavoidable c. Objective d. Subjective 50. Relevant cash flows are a. Avoidable b. Incremental c. Both of the above d. None of the above 51. Frank is considering transportation modes to a c lient’s office. He can drive his own car, at an incremental cost of $0.55 per mile, or take a co mpany car. If he takes his own car, he can be reimbursed $0.45 per mile. If Frank makes his deci sion strictly from his personal economic point of view, what is the relevant net cost associated with driving his own car? a. $0.10 b. $0.45 c. $0.55 d. Some other amount 52. As an accountant, you are responsible for I. Your own behavior II. The behavior of any organizations you manage III. The behavior of outside vendors with whom you interact a. I only b. I and II only c. I and III only d. I, II, and III 53. When is the most appropriate time to identify ethical problems in organizations? a. When they are discovered by legal authorities b. As they arise c. After they arise d. When they are discovered by shareholders 1-10 Cost Management 54. Conflicts of interest often compromise managers ’ ability to make ethical decisions. Which of the following situations most likely includes a conflict of interest? a. Selling goods and services at discounted prices to some clients based on historical volumes b. Offering sales on credit on ly to creditworthy clients c. Paying dividends to shareholders rather than investing in an environmental project d. Using LIFO to report the cost of ending inventory on the balance sheet 55. Rewards for ethical behavior can include I. Integrity II. Reputation III. Higher profits a. I, II, and III b. I and III only c. I and II only d. II only 56. Which of the following can influence ethical behavior in organizations? I. Employee personal values II. Systems for measuring, monitoring and motivating III. Organizational culture a. I only b. I and II only c. I and III only d. I, II, and III 57. Fraudulent financial reporting I. Is an example of unethical behavior II. Eventually is likely to d ecrease organizational market value III. Decreases the value of the accounting profession a. I only b. II only c. I and III only d. I, II, and III Multiple Choice from Study Guide s58. Decision quality a. Refers to a decision that had a positive outcome b. Refers to the characteristics of a decision that affects the likelihood of achieving a positive outcome c. Is reduced by uncertainty and bias d. Both (b) and (c) are correct s59. Which of the following statements is false ? a. Managers must determine the organizationa l vision before further planning can occur b. Organizational strategies should take advant age of the organization’s core competencies c. Operating plans are long-term in nature d. Organizational core competencies are an or ganization’s strengths relative to competitors Chapter 1: The Role of Accounting Info rmation in Management Decision Making 1-11 s60. Which of the following statements is true? a. Managerial accounting and cost accounting are the same thing b. Managerial accounting prepares reports used most frequently by external decision makers c. Cost accounting information is used fo r both management and financial accounting d. Preparation of the entity’s income tax retu rn is an example of a cost accounting activity s61. All of the following are examples of external reports except: a. Tax returns b. Credit reports c. Financial statements d. Budgets s62. All of the following are examples of internal reports except: a. Cash flow analyses b. News releases c. Analyses of supplier quality d. Product mix analyses s63. If a manager is deciding whether to repair equipmen t or replace it, which of the following is irrelevant to the decision? a. Cost of the repair b. Original cost of the equipment c. Warranty period for the repair d. Expected life of the equipment if it is not repaired s64. Lori is deciding whether to go to school full-time at the local community college or get a full time job. Which of the following is not relevant to her decision? a. Tuition costs b. Potential salary she could earn in a full-time job c. Cost of books d. Monthly rent on her apartment s65. Relevant cash flows are a. Unavoidable b. Incremental cash flows c. Constant across alternatives d. Those that occurred in the past s66. Which of the following is not one of the steps in ethical decision making? a. Identify the ways you might get caught doing something unethical b. Identify the stakehol ders to the decision c. Identify the ethical dilemma d. Identify the effects of the decision on the stakeholders s67. Which of the following statements is false ? a. Strategic cost management focuses on reducing costs as well as strengthening an organization’s strategic position b. The balanced scorecard is a formalized approach to strategic cost management c. The balanced scorecard may include bo th financial and nonfinancial measures d. Cost accounting information used for strategic cost management includes only measures of costs 1-12 Cost Management Multiple Choice from Web Quizze s (Available on Student Web Site) w68. An internal report is a. Used for decision making primarily inside the organization b. Used for decision making primarily outside the organization c. Used to explain new personnel policies d. Used by financial analysts w69. Cost accounting is all of the following except a. A process of gathering and summarizing information b. Preparing employee evaluation reports c. Preparing information for internal reporting and decision making d. Preparing information used in financial statements w70. Financial accounting is all of the following except a. A process of gathering and summarizing in formation primarily for external reports b. Preparing financial statements according to Generally Accepted Accounting Principles c. Information used by shareholders, creditors, and regulators for decision making d. Preparing information for internal reporting and decision making w71. Decision quality can best be increased by a. Thinking harder b. Controlling for bias and uncertainties c. Asking an expert for help d. Using the most current technology w72. Biases are a. Necessary for decision making b. Expert opinions c. Ideas that are adopted without careful thought d. Always part of decision making w73. Uncertainties are a. Issues about which we have doubt b. Foreseeable factors c. Not usually part of decision making d. Biased information w74. Relevant information a. Plays no part in decision making b. Varies with the action taken c. Must be based on the opinion of experts d. Is the same as unavoidable cash flows w75. Avoidable cash flows are a. Usually relevant to a decision b. Cash flows that are incurred no matter which action is taken c. Ignored in decision making d. Are the same as irrelevant cash flows w76. Ethical decision making a. Does not include ongoing improvement b. Considers the well-being of those affected by the decision c. Has little to do with professional reputation d. Is not important for accountants Chapter 1: The Role of Accounting Info rmation in Management Decision Making 1-13 w77. The incremental cash flow approach a. Analyzes the additional cash inflow s and outflows for a specific decision b. Is not useful for decision making c. Is a search for as many cash flows as possible so they can all be used in decision-making. d. Includes unavoidable cash flows w78. Strategic cost management fo cuses on all of the following except a. Strengthening an organization’s strategic position. b. Reducing costs c. Both financial and non-financial measures d. Producing financial statements w79. Information for decision making a. Is only produced inside an organization. b. Includes estimates and predictions c. Ensures certainty in the decision making process d. Is easy to identify w80. Cost accounting differs from financial accounting in that cost accounting is a. Primarily concerned with income determination b. Relied on for analyzing and implementing internal decisions c. Focused only on qualitative information d. Primarily concerned with external reporting w81. Tom is gathering information a bout buying a new car to replace his existing car. The following items are irrelevant a. The purchase price of the new car b. The gasoline mileage of the new car c. The cost of parking at the university d. The money Tom will receive for selling the old car w82. Lisa would like to start a new business selling pet toys to local pet shops. To reduce her uncertainty about the volume of toys she can sell in a month, she should do all of the following except a. Ask pet store managers how many pet toys they sell every month b. Determine the average price of the pet toys sold each month at local pet stores c. Take a sample of toys to local stores and ask how many of each item the managers would be willing to buy d. Produce as many toys as possible the first month to be certain she has enough w83. (CMA) When comparing strategic planning with ope rational planning, which one of the following statements is most appropriate? a. Strategic planning is performed at all levels of management b. Operational planning results in budget data c. Strategic planning focuses on authority and responsibility d. Operational planning is long-range in focus w84. (CMA) Wong Company utilizes both strategic planning a nd operational budgeting. Which one of the following items would normally be considered in a strategic plan? a. Setting a target of 12 percent return on sales b. Maintaining the image of the company as the industry leader c. Setting a market price per share of stock outstanding d. Distributing monthly reports for departmental variance analysis 1-14 Cost Management Matching 1. Consider the following activities, which could be undertaken by managers at Southwest Airlines. Indicate whether each item is most likely part of: (S) organizational strategies, (P) operating plans, (A) actual operations or (M) measuring, monitori ng and motivating. Each numbered item has only one correct response. ____ 1. comparing actual revenues with budgeted revenues ____ 2. developing processes fo r handling customer complaints ____ 3. handling customer complaints ____ 4. hosting an annual employee picnic ____ 5. maintaining high quality customer service _____ 6. negotiating contracts with the flight attendant union over the next six months ____ 7. opening a new route to Philadelphia ____ 8. providing employees opportunities to buy stock at discounted prices ____ 9. valuing training for employees to increase organizational competence ____ 10. reporting periodic financial results 2. The owner of a local restaurant is deciding whethe r to lease a company van. If the van is leased, the company would avoid paying its ven dors to deliver the supplies and food purchases. The owner has negotiated a potential lease contract that would requi re a down payment plus a flat monthly rental payment. At the end of each year, an additional “contingency” rental paym ent would be required if the total number of miles driven exceeds 8,000. Th e owner has estimated that the van will be driven 600 miles per month for picking up supplies and fo od purchases, so she does not expect to incur a contingency annual payment. Based on these miles, the owner has calculated the expected amount of cost for fuel, repairs, and maintenance. She h as received a quote from her insurance company for the next six months’ insurance. She plans to hire a pa rt-time employee at $10 per hour to drive the van. The employee will work a flexible schedule based on the deliveries required. Items 1 through 7 are relevant costs for this decision. Indicate whether the dollar amount of each relevant cost is most likely (C) certain or (U) uncertain. Each numbered item has only one correct response. ____ 1. Lease down payment ____ 2. Monthly lease rental payments ____ 3. Contingency annual payment ____ 4. Fuel, repairs, and maintenance ____ 5. Van insurance for the next six months ____ 6. Part-time employee wages ____ 7. Reduction in vendor delivery charges 3. Indicate whether each of the following items is prim arily: (I) an internal report or (E) an external report. Each numbered item has only one correct response. ____ 1. analysis of potential acquisitions ____ 2. analysis of product mix ____ 3. capital budgets Chapter 1: The Role of Accounting Info rmation in Management Decision Making 1-15 ____ 4. cash flow plan ____ 5. credit reports ____ 6. financial statements ____ 7. inventory reports for suppliers ____ 8. news release ____ 9. analysis of supplier quality ____ 10. tax returns 4. Rick is an accountant for MRT Corporation. His boss has asked him to make a recommendation about buying or leasing new computer equipment for the accounting department. A decision has already been made to acquire a particular type of equipment. The only remaining decision is whether the equipment will be purchased or leased. Several pieces of information Rick might consider in his decision are listed below. Indicate whether each of the following items is: (R) relevant or (I) irrelevant to the decision. ____ 1. cost of current computer equipment ____ 2. interest rate for lease ____ 3. employee feelings about the type of new computer equipment ____ 4. cost of purchasing new equipment ____ 5. depreciation on old equipment ____ 6. future reliability of new equipment ____ 7. independent quality ratings on new equipment ____ 8. trade-in value of old equipment ____ 9. tax incentives to lease ____ 10. personal relations hip with equipment vendor 5. The Institute of Management Accountants (IMA) Standards of Ethical Conduct for Members includes four standards: (A) competence, (B) confidentia lity, (C) integrity and (D) objectivity. Several elements of these standards are listed below. Indi cate, with the appropriate letter, the applicable standard for each. Each numbered ite m has only one correct response. ____ 1. Avoid actual or appa rent conflicts of interest. ____ 2. Communicate information fairly. ____ 3. Communicate unfavorable as well as fa vorable information and professional judgments or opinions. ____ 4. Disclose fully all relevant information th at could reasonably be expected to influence an intended user’s understanding of the reports , comments, and recommendations presented. ____ 5. Inform subordinates as appropriate regard ing the privacy of information acquired in the course of their work. ____ 6. Monitor subordinates’ activities to assure the maintenance of privacy. ____ 7. Perform their professional duties in acco rdance with relevant laws and regulations.