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ACCA Financial Management

Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Amounts given to the organization for operating purposes - such as governmental appropriations and unrestricted donations.






2. Costs that stay the same in total over the relevant range as volume increases - but that change inversely on a per unit basis.






3. Organizational units primarily responsible for ensuring that services are provided to a population in a manner that meets the volume and quality requirements of the organization. Service centers are the most basic type of responsibility centers.






4. The costs of a service after taking into account its direct and fair share of allocated costs.






5. The ease and speed with which an asset can be turned into cash.






6. [Total assets/Net Assets]






7. That point at which total revenues equal total costs. It is described by the equation: (price x volume) = fixed costs + (variable cost per unit x volume).






8. [net assets/total assets)- This ratio reflects the proportion of total assets financed by equity. In for-profit organizations it is called the equity to total asset ratio and is calculated using the formula [owners' equity/total assets).






9. The cash flows derived from an organization's operating activities.






10. A measure of the income earned from operating activities. It is calculated as: unrestricted revenues - gains - and other support -expenses and losses.






11. A method of allocating costs that are not directly paid for (utilities - rent - administration) into those products or services to which payment is attached (day of care - a brief visit). See also Activity-based costing.






12. Stated interest rate on a bond - as promised by the issuer.






13. Operating income not reported elsewhere under revenues - gains - and other support.






14. I) Organizations that have a special designation because they provide goods or services that result in needed community benefit. In turn - such organizations are not required to pay most taxes. 2) The designation of an organization as one that is not






15. An estimate/measure of how much a tangible asset (such as plant or equipment) has been "used up" during an accounting period. It is an expense that does not require any cash outflow under the accrual basis of accounting. See also Accumulated deprecia






16. The process of adjusting for the time value of money backward in time to present value. See also Compounding.






17. The category of assets summarizing the amount of the major capital investments of the facility in plant - property - and equipment (PP&E). Plant means buildings - property is land - and equipment includes a wide variety of durable items from beds to






18. [total revenues/total assets].- This ratio measures the overall efficiency of the organization's assets to produce revenue. It answers the question: For every dollar in assets - how many dollars of revenue are being generated?






19. Portion of profit an organization distributes to investors. By law - only investor-owned health care organizations can distribute dividends outside the organization.






20. The amount of inventory on hand at the end of an accounting period. See also Beginning inventory.






21. I) The cost to borrow money. It can be expressed in dollars or as a percentage. 2) Payment to creditors for the use of money on credit.






22. An entity that gives capital to another entity in expectation of a financial or non-financial return.






23. Financing used expressly for the purchase of non-current assets.






24. Revenues of the organization earned in non-healthcare related activities.






25. The income (operating revenues -operating expenses) earned in non-health-care related activities.






26. The amount of inventory on hand at the beginning of an accounting period. See also Ending inventory.






27. Ratios that measure how the organization's assets are financed and/or whether the organization can take on new debt.






28. {current liabilities/[(total expenses






29. Service center costs are allocated to both mission centers and other service centers






30. General and administrative expenses. Operating expenses that are not contained in the labor or supplies budgets.






31. [Total Liabilities/ Net assets]






32. The total amount of multiyear debt due in future years.






33. Requiring the patient to pay part of his/her health care bill. These payments are used to prevent over-utilization of services.






34. Budgets that typically cover two to five years.






35. Proceeds lost by foregoing other opportunities.






36. A donation that has conditions which must be satisfied. See also Temporarily restricted net assets.






37. A borrower's assets on which a lender has legal claim if a borrower defaults on a loan.






38. Highly liquid current assets such as interest-bearing savings and checking accounts.






39. The elapsed time between financial statements. Common accounting periods






40. Recording expenses associated with making revenue at the same time as revenues are recognized






41. Financing that will be paid back in less than one year.






42. Literally non-movable assets. Generally used to refer to buildings and equipment.






43. A security whose interest rate does not change during the lifetime of the bond.






44. [Surplus/Operating Revenues]






45. [Net Assets/Total Assets]. This ratio reflects the proportion of total assets financed by equity.






46. Activity-based costing. A method to determine the costs of a service - product - or customer by tracing the resources consumed. ABC focuses on: I) controlling as well as calculating costs - 2) tracing as opposed to allocating costs - and 3) the impor






47. Organizational units responsible for providing services and controlling their costs. There are two major types: clinical cost centers and administrative cost centers.






48. Organizational units responsible for providing administrative support at a profit to other organizational units or to the organization as a whole and/or raising funds externally.






49. Amounts the organization is obligated to pay others - including suppliers and creditors.






50. The cost of activities that take place to produce the final cost object