CEOE OSAT - Business Education
Exam Questions and Answers
Management - ANSWER-The act of engaging with an organization's human talent and
its resources to accomplish desired goals and objectives.
Function of Business Management - ANSWER-Planning, Organizing, Staffing,
Leading/Directing, Controlling/Monitoring, and Motivating
Planning - ANSWER-The function of management where you decide what needs to
happen in the future (today, next month, next year, etc.) and generating plans for action.
Organizing - ANSWER-The function of management where you implement a pattern of
relationships among workers and making optimum use of the resources required to
enable the successful carrying out of plans.
Staffing - ANSWER-The function of management that includes Job analysis,
recruitment, and hiring of people with the necessary skills for appropriate jobs. Providing
or facilitating ongoing training, if necessary, to keep skills current.
Leading/Directing - ANSWER-The function of management that involves determining
what needs to be done in a situation and getting the right people to do it.
Controlling/Monitoring - ANSWER-The function of management that involves checking
current outcomes against forecast plans and making adjustments when necessary so
that goals are achieved.
Motivating - ANSWER-The function of management that consists of energizing,
channeling and sustaining people's behavior towards the goals of the organization.
Stakeholders - ANSWER-Persons or organizations with a legitimate interest in a given
situation, action ,or enterprise which are directly affected by the organization's actions.
Theoretical - ANSWER-Of or relating to the underlying principles or methods of a given
technical skill, art, etc., as opposed to its practice.
Shareholder - ANSWER-Through owning stock ,the real owner of a publicly traded
business that is run by management.
Capital expenditure - ANSWER-Funds spent by a company to acquire or upgrade a
long-term asset.
,Controller - ANSWER-A person who audits and manages the financial affairs of a
company or government; a comptroller.
Delegation - ANSWER-The act of committing a task to someone, especially a
subordinate.
Line Authority - ANSWER-Managers have the formal power to direct and control
immediate subordinates executing specific tasks within a chain of command, usually
within a specific department.
Functional Authority - ANSWER-Managers have formal power over a specific subset of
activities that include outside departments. (Before a production manager buys a new
machine, a expenditure proposal must be submitted.)
Staff Authority - ANSWER-Staff specialists manage operations in their areas of
expertise.
Tall Structure - ANSWER-Management structure characterized by an overall narrow
span of management, a relatively large number of hierarchical levels, tight control, and
reduced communication overhead.
Flat Structure - ANSWER-Management structure characterized by an overall broad
span of management and relatively few hierarchical levels, loose control and ease of
delegation.
Centralization - ANSWER-The location of decision making authority near top
organizational levels. This expedites decision-making from the top down.
Decentralization - ANSWER-The location of decision making authority is relatively
evenly dispersed across the company. This works well when creativity and independent
operations create value for the organization.
Laissez-faire - ANSWER-An environment in which an organization's employees are free
from excessive oversight or management, with sufficient control only to ensure
organizational goals are met.
Accounting - ANSWER-The systematic and detailed recording of financial transactions
of a business.
Why is accounting important? - ANSWER-Helps track income and expenditures, ensure
statutory compliance, and provide investors, management, and government with
quantitative financial information which can be used in making business decisions.
Income Statement - ANSWER-Provides you with information about the profit and loss
, The Balance Sheet - ANSWER-Gives you a clear picture on the financial position of
your business on a particular date.
Cash Flow Statement - ANSWER-A bridge between the income statement and balance
sheet that reports the cash generated and spent during a specific period of time.
Accounting Equation - ANSWER-The idea that a company's total assets are equal to
the sum of its liabilities and its shareholders' equity. The foundation of the double-entry
accounting system.
Double Entry Accounting - ANSWER-A system that requires one debit and one credit
entry for every transaction within a business. It tracks where your money comes from
and where it's going.
Assets - ANSWER-Resources controlled by the company.
Liabilities - ANSWER-The obligations, or debts, that a company owes and costs that it
needs to pay in order to keep the company running.
Sections of a Balance Sheet - ANSWER-Assets, Liabilities, and Shareholder's Equity
(owner's equity)
Accounts receivables - ANSWER-Lists the amounts of money owed to the company by
its customers for the sale of its products.
Cash Equivalents - ANSWER-Type of asset that that is liquid and not subject to material
fluctuations in value. Includes commercial paper, Treasury bills, and short-term (3 mo.
or less) government bonds.
Cash and Cash equivalents - ANSWER-First line of assets on a Balance Sheet that
reports the value of a company's assets that are cash or can be converted into cash
immediately.
Shareholder's Equity - ANSWER-A company's total assets minus its total liabilities.
Retained Earnings - ANSWER-A part of the shareholder's equity that is the sum of total
earnings that were not paid to shareholders as dividends. Represents the total profits
that have been saved and put aside for future use.
Accounting Equation Formula - ANSWER-Assets = (Liabilities + Owner's Equity)
Example of Double-Entry Accounting - ANSWER-If a business buys raw materials and
pays in cash, it will result in an increase in the inventory (an asset) while reducing cash
capital (another asset).
Exam Questions and Answers
Management - ANSWER-The act of engaging with an organization's human talent and
its resources to accomplish desired goals and objectives.
Function of Business Management - ANSWER-Planning, Organizing, Staffing,
Leading/Directing, Controlling/Monitoring, and Motivating
Planning - ANSWER-The function of management where you decide what needs to
happen in the future (today, next month, next year, etc.) and generating plans for action.
Organizing - ANSWER-The function of management where you implement a pattern of
relationships among workers and making optimum use of the resources required to
enable the successful carrying out of plans.
Staffing - ANSWER-The function of management that includes Job analysis,
recruitment, and hiring of people with the necessary skills for appropriate jobs. Providing
or facilitating ongoing training, if necessary, to keep skills current.
Leading/Directing - ANSWER-The function of management that involves determining
what needs to be done in a situation and getting the right people to do it.
Controlling/Monitoring - ANSWER-The function of management that involves checking
current outcomes against forecast plans and making adjustments when necessary so
that goals are achieved.
Motivating - ANSWER-The function of management that consists of energizing,
channeling and sustaining people's behavior towards the goals of the organization.
Stakeholders - ANSWER-Persons or organizations with a legitimate interest in a given
situation, action ,or enterprise which are directly affected by the organization's actions.
Theoretical - ANSWER-Of or relating to the underlying principles or methods of a given
technical skill, art, etc., as opposed to its practice.
Shareholder - ANSWER-Through owning stock ,the real owner of a publicly traded
business that is run by management.
Capital expenditure - ANSWER-Funds spent by a company to acquire or upgrade a
long-term asset.
,Controller - ANSWER-A person who audits and manages the financial affairs of a
company or government; a comptroller.
Delegation - ANSWER-The act of committing a task to someone, especially a
subordinate.
Line Authority - ANSWER-Managers have the formal power to direct and control
immediate subordinates executing specific tasks within a chain of command, usually
within a specific department.
Functional Authority - ANSWER-Managers have formal power over a specific subset of
activities that include outside departments. (Before a production manager buys a new
machine, a expenditure proposal must be submitted.)
Staff Authority - ANSWER-Staff specialists manage operations in their areas of
expertise.
Tall Structure - ANSWER-Management structure characterized by an overall narrow
span of management, a relatively large number of hierarchical levels, tight control, and
reduced communication overhead.
Flat Structure - ANSWER-Management structure characterized by an overall broad
span of management and relatively few hierarchical levels, loose control and ease of
delegation.
Centralization - ANSWER-The location of decision making authority near top
organizational levels. This expedites decision-making from the top down.
Decentralization - ANSWER-The location of decision making authority is relatively
evenly dispersed across the company. This works well when creativity and independent
operations create value for the organization.
Laissez-faire - ANSWER-An environment in which an organization's employees are free
from excessive oversight or management, with sufficient control only to ensure
organizational goals are met.
Accounting - ANSWER-The systematic and detailed recording of financial transactions
of a business.
Why is accounting important? - ANSWER-Helps track income and expenditures, ensure
statutory compliance, and provide investors, management, and government with
quantitative financial information which can be used in making business decisions.
Income Statement - ANSWER-Provides you with information about the profit and loss
, The Balance Sheet - ANSWER-Gives you a clear picture on the financial position of
your business on a particular date.
Cash Flow Statement - ANSWER-A bridge between the income statement and balance
sheet that reports the cash generated and spent during a specific period of time.
Accounting Equation - ANSWER-The idea that a company's total assets are equal to
the sum of its liabilities and its shareholders' equity. The foundation of the double-entry
accounting system.
Double Entry Accounting - ANSWER-A system that requires one debit and one credit
entry for every transaction within a business. It tracks where your money comes from
and where it's going.
Assets - ANSWER-Resources controlled by the company.
Liabilities - ANSWER-The obligations, or debts, that a company owes and costs that it
needs to pay in order to keep the company running.
Sections of a Balance Sheet - ANSWER-Assets, Liabilities, and Shareholder's Equity
(owner's equity)
Accounts receivables - ANSWER-Lists the amounts of money owed to the company by
its customers for the sale of its products.
Cash Equivalents - ANSWER-Type of asset that that is liquid and not subject to material
fluctuations in value. Includes commercial paper, Treasury bills, and short-term (3 mo.
or less) government bonds.
Cash and Cash equivalents - ANSWER-First line of assets on a Balance Sheet that
reports the value of a company's assets that are cash or can be converted into cash
immediately.
Shareholder's Equity - ANSWER-A company's total assets minus its total liabilities.
Retained Earnings - ANSWER-A part of the shareholder's equity that is the sum of total
earnings that were not paid to shareholders as dividends. Represents the total profits
that have been saved and put aside for future use.
Accounting Equation Formula - ANSWER-Assets = (Liabilities + Owner's Equity)
Example of Double-Entry Accounting - ANSWER-If a business buys raw materials and
pays in cash, it will result in an increase in the inventory (an asset) while reducing cash
capital (another asset).
