Multiple choice questions:
Question 2
It is most advisable for a sales manager to schedule an audit:
A. only after some major problem has emerged.
B. when competition becomes fierce.
C. at least quarterly.
D. at least annually.
Question 3
Of the following, __________ will be the most reliable, accurate, and important single source of sales information.
A. warranty cards
B. salesperson's call reports
C. customer invoices
D. salesperson's expense reports
Question 4
Alma Molloy has recently been promoted to sales manager for a medium-sized consumer products wholesaler. She wants to find out the names of prospects and customers being called on, products sold, terms of sale, methods of payment, and mode of shipment. Which of the following sources of sales information will be most helpful to Ms. Molloy?
A. Consumer diaries and salespersons' expense accounts
B. Sales invoices and salespersons' call reports
C. Individual customer and prospect records and warranty cards
D. Warranty cards and store audits
Question 5
When deciding at what organizational level the sales analysis will be conducted, the following factor is not considered:
A. region.
B. territory.
C. organizational hierarchy.
D. district.
Question 6
__________ provide basic demographic data on customers, location of purchases, prices paid, reasons for purchases, and service expected.
A. Warranty cards
B. Consumer diaries
C. Salesperson's call reports
D. Sales invoices
Question 7
The first figures studied in sales analysis are:
A. sales volume.
B. sales costs.
C. direct selling costs.
D. indirect selling costs.
Question 8
It is important that all sales managers understand the "iceberg principle" because it states that:
A. analogous to the invisible 90 percent of floating icebergs which can sink mighty ships (like the Titanic), favorable total sales figures can hide unprofitable market segments and unproductive sales activities.
B. large numbers of the sales force are not very productive compared to what they could be since their sales managers are cold, aloof, and insensitive to their individual needs, i.e., they act much like a floating iceberg.
C. like a floating iceberg, some salespeople will initially rise above the others due to their self-promotion efforts and flamboyance, yet it is the hardworking average salesperson who makes up the vast ocean of successful salespeople.
D. many salespeople merely float near the surface, somewhat like icebergs, without ever attempting any in-depth penetration of their markets to obtain larger sales.
Question 9
With regard to collecting sales data, all of the following are true EXCEPT:
A. sales figures are usually reported in both dollars and units.
B. sales data are frequently subcategorized by territories.
C. sales data are frequently subcategorized by customer class.
D. sales data by territory typically cannot be subdivided any further.
Question 10
The relationship between inputs (marketing efforts) and outputs (sales goals or results) is known as input-output efficiency-a measure of sales organization efficiency. From the data given below, what is the efficiency ratio?
Data:
(1) 3,000 sales calls at $100
(2) 5,000 telephone calls at $1
(3) 15 trade magazine advertisements at $1,000
(4) Sell 2,000 new office machines ($1,000 each) @ $500 gross margin
A. 2.000
B. 3.125
C. 5.150
D. 8.500
Question 11
Costs that do not change with sales volume are known as:
A. functional costs.
B. indirect costs.
C. fixed costs.
D. sunk costs.
Question 12
Relative to the analysis of sales volume, costs, and profits, traditional income statements can be considered as:
A. extremely beneficial.
B. direct and to the point.
C. limited value because they fail to reveal the costs of performing different marketing activities.
D. the basic tool of analysis.
Question 13
Marketing cost analysis:
A. studies total sales volume first.
B. adds sales revenue to various market segments or organizational units.
C. investigates the costs incurred and profits generated from sales volume.
D. is performed entirely by the headquarters marketing team.
Question 14
The "concentration principle" suggests that:
A. favorable total sales figures can easily hide unprofitable market segments.
B. the major portion of any organization's sales, costs, or profits comes from a small proportion of business segments.
C. target markets with high potential are concentrated in sparsely populated geographical areas.
D. sales force efforts should be concentrated on only one type of customer.
Question 15
For a particular product line, sales during the past year were about $15,000,000, cost of goods sold were $10,000,000, sales expenses were $1,200,000, and fixed costs were $2,000,000. What was the product line's contribution margin for the year?
A. $13,800,000
B. $3,800,000
C. $5,000,000
D. $3,000,000
Question 16
With regard to the full costs versus contribution margin controversy, which of the statements below is INCORRECT?
A. Under the full costs (or net profit) approach, all cost must be assigned in order to determine actual profit.
B. The contribution margin approach claims that only costs that are controllable and traceable to a particular segment should be subtracted from the revenue produced by that segment.
C. In marketing costs analysis, the trend in marketing profitability factors the full-cost approach.
D. With the contribution margin approach, costs are classified as either variable or fixed, then all the variable costs are deducted from sales to determine a given segment's contribution margin.
Question 17
Which of the following approaches considers the interrelationships among marketing activities and the synergism of their efforts?
A. The marketing costs approach
B. The input-output efficiency approach
C. The full-cost approach
D. The contribution margin approach
Question 18
Compute the Return on Assets Managed (ROAM) for each segment of the business using the following data:
Accounts Receivable = $3,000,000
Inventory = $7,000,000
Contribution Margin = $2,000,000
Sales = $5,000,000
A. 0.2
B. 0.3
C. 0.4
D. 0.5
Question 19
ROAM is:
A. interchangeable with ROI.
B. the product of the profit margin on sales.
C. the result of the profit margin on sales minus inventory turnover.
D. equal to sales/net profit times total assets used/sales.
Question 20
To increase the return on assets managed for specific segments, the sales manager can:
A. raise the profit margin on sales.
B. increase total sales while decreasing profit margins.
C. increase the relative dollar value of assets necessary to achieve sales.
D. conduct sales audits by segments to identify those that are yielding inadequate contribution margins.