Chapter 10

Question 1

bonus

Answer 1

An incentive payment that is supplemental to the base wage

Question 2

combined salary and commission plan

Answer 2

A compensation plan that includes a straight salary and a commission

Question 3

differential piece rate

Answer 3

A compensation rate under which employees whose production exceeds the standard amount of output receive a higher rate for all of their work than the rate paid to those who do not exceed the standard amount,

Question 4

employee stock ownership plans (ESOPs)

Answer 4

Stock plans in which an organization contributes shares of its stock to an established trust for the purpose of stock purchases by employees

Question 5

gainsharing plans

Answer 5

Programs under which both employees and the organization share financial gains according to a predetermined formula that reflects improved productivity and profitability

Question 6

lump-sum merit program

Answer 6

Program under which employees receive a year-end merit payment, which is not added to their base pay

Question 7

merit guidelines

Answer 7

Guidelines for awarding merit raises that are tied to performance objectives

Question 8

perquisites

Answer 8

Special nonmonetary benefits given to executives; often referred to as perks

Question 9

profit sharing

Answer 9

Any procedure by which an employer pays, or makes available to all regular employees, in addition to base pay, special current or deferred sums based on the profits of the enterprise

Question 10

salary plus bonus plan

Answer 10

A compensation plan that pays a salary plus a bonus achieved by reaching targeted sales goals

Question 11

spot bonus

Answer 11

An unplanned bonus given for employee effort unrelated to an established performance measure

Question 12

standard hour plan

Answer 12

An incentive plan that sets rates based on the completion of a job in a predetermined standard time

Question 13

straight commission plan

Answer 13

A compensation plan based on a percentage of sales

Question 14

straight piecework

Answer 14

An incentive plan under which employees receive a certain rate for each unit produced

Question 15

straight salary plan

Answer 15

A compensation plan that permits salespeople to be paid for performing various duties that are not reflected immediately in their sales volume

Question 16

team incentive plan

Answer 16

A compensation plan in which all team members receive an incentive bonus payment when production or service standards are met or exceeded

Question 17

variable pay

Answer 17

Tying pay to some measure of individual, group, or organizational performance