Assesment 2

Question 1

Advantages of using interviews as a method for selection ( 2 points )

Answer 1

• Allows 2 way communication between employee and employer
• Allows the employer to check information on an application. This means if the employer has doubts on the reliability of the form they can check it

Question 2

Disadvantages of using interviews as a method of selection ( 2 points )

Answer 2

• Interviews may be intimidating for applicants which means they may not preform to their best ability & not receive the job
• Assessment by human introduces a bias based perception. This means the best candidate man not he chosen for the job and the company could be liable for job discrimination

Question 3

Advantages of using appraisal as a method of job satisfaction

Answer 3

• Identifies staff weaknesses and helps plan training, increasing motivation
• Increases staff competence and overall productivity, which increases profits.

Question 4

Factors affecting job satisfaction ( 6 points )

Answer 4

• Wage/salaries
• Responsibility
• Success
• Enjoyment
• Working conditions
• Praise

Question 5

Break even formula

Answer 5

Total fixed cost / (selling price per unit - variable cost per unit )

Question 6

Purpose of a cash flow forecast ( 3 points )

Answer 6

• Predicts level of income & level of expenditure the business will have during this time
• If the business needs to loan money, a cash flow forecast will show when and how much money they need to loan. This prevents paying interest for longer than necessary
• It shows when money can be repaid which will help receiving a loan from the bank in the first place

Question 7

How to complete a cash flow forecast ( 5 points )

Answer 7

-complete receipts
-complete payments
-create totals for both
-take total payments from total receipts
-put in closing balance

Question 8

Interpreting a cash flow forecast ( 3 points )

Answer 8

• Say if the business will have sufficient money at the end of the month
• Say if and when they must take out a loan
• State the final closing balance

Question 9

Consequences of incorrect cash flow forecast ( 2 points )

Answer 9

• May lead to a cash shortage. This can mean wages go unpaid & leads to a higher level of labour turnover
• If the cash flow forecasting is incorrect the business may have to close it down

Question 10

Significance of the break even point

Answer 10

Shows the amount of sales needed to make a profit, cost levels the business can afford to cover, the prices that need to be charged for goods.

Question 11

Margin of safety calculation

Answer 11

Actual sales - Break even output

Question 12

Significance of margin of safety

Answer 12

The bigger the margin of safety the more potential profit can be made. A higher margin of safety means lower risk.

Question 13

Disadvantages of using appraisal

Answer 13

• Employees can find it hard to be self critical to identify their own faults & indentify areas they need to improve in. This means they don’t get necessary training meaning the business can loose quality and work productivity

Question 14

Contract of employment contents ( 4 points )

Answer 14

• Names of employee & employer
• Title & description of job
• Hours of work
• Agreed rates & method of payments

Question 15

Interview definition

Answer 15

Applicants are shortlisted and then invited for an interview where they answer questions & discuss the post. All applicants get asked the same questions and usually they are scored with the highest scoring applicant winning the job.

Question 16

Advantages of using external recruitment ( 2 points )

Answer 16

• wide range of applicants, this means more ideas can be brought into the business
• avoids jealously among existing employees over hiring so better working environment

Question 17

Disadvantages of using external recruitment ( 2 points )

Answer 17

• costly process meaning the business has to spend more money on recruitment instead of other goals
• no job opportunities created within the business meaning it is bad for morale