CHRP - Certified Human Resources Professional HR Metrics and Financials Questions and Answers

Question 1

An HR department invested $40,000 in a new sales training program. As a result, the sales team's revenue increased by $160,000, and the cost of goods sold associated with that revenue was $90,000. What is the Return on Investment (ROI) for this training program?

Accepted Answer

75%

Answer

The formula for ROI is ([Financial Gain - Cost of Investment] / Cost of Investment) x 100. The financial gain is the increase in revenue minus the associated costs ($160,000 - $90,000 = $70,000). The ROI is therefore ([$70,000 - $40,000] / $40,000) x 100, which equals ($30,000 / $40,000) x 100 = 75%.

Question 2

A company with 200 employees has an annual turnover rate of 12%. The average salary of departing employees is $55,000. If the cost to replace an employee is estimated to be 75% of their annual salary, what is the company's total annual cost of turnover?

Accepted Answer

$990,000

Answer

First, calculate the number of employees who left: 200 employees * 12% = 24 employees. Next, calculate the cost to replace one employee: $55,000 * 75% = $41,250. Finally, multiply the number of departed employees by the replacement cost: 24 * $41,250 = $990,000.

Question 3

Which of the following metrics is considered a measure of an organization's overall productivity and efficiency by calculating how much revenue is generated for each person on the payroll?

Accepted Answer

Revenue per Employee

Answer

Revenue per Employee (Total Revenue / Total Number of Employees) is a fundamental HR and financial metric used to gauge the efficiency and productivity of the workforce in generating revenue.

Question 4

A company's recruitment effort for the last quarter involved the following costs: $20,000 in advertising fees, $15,000 in recruitment agency fees, and $35,000 for the prorated salaries of the internal recruiting team. If 10 employees were hired during this period, what was the Cost Per Hire?

Accepted Answer

$7,000

Answer

The Cost Per Hire is calculated by summing all internal and external recruiting costs and dividing by the number of hires. Total costs are $20,000 + $15,000 + $35,000 = $70,000. Divided by 10 hires, the Cost Per Hire is $7,000.

Question 5

In the context of a Balanced Scorecard, an HR metric such as 'Time to Fill Critical Roles' would most directly inform which of the four perspectives?

Accepted Answer

Internal Business Process

Answer

The 'Internal Business Process' perspective focuses on the efficiency and effectiveness of an organization's internal operations. 'Time to Fill' is a key metric that measures the efficiency of the recruitment process, which is a critical internal HR function.

(CHRP) Certified Human Resources Professional Practice Test

(CHRP) Certified Human Resources Professional Practice Test

CHRP - Certified Human Resources Professional HR Metrics and Financials Questions and Answers