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Test your basic knowledge |
ACCA Financial Management
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Subjects
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certifications
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business-skills
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acca
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. The budget used to forecast - and in some cases justify - the expenditures (and in some cases the sources of financing) for non-current assets.
Increase in unrestricted net assets
Capital budget
Fixed (interest) rate debt
Long-term investments
2. Return on investment. The percentage gain or loss experienced from an investment.
Fixed asset turnover
Expense cost variance
ROI
Step-down method
3. 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
Fixed (interest) rate debt
Discounting
Properties and equipment
Acid test ratio
4. A budget which presents not only line items and programs but also the performance goals that each program can be expected to attain. See also Line item budget and Program budget.
Performance budget
Mail float
Line-item budget
Parent organization
5. [(actual volume -budgeted volume) x budgeted cost per unit).- The portion of total variance that is due to actual volume being either higher or lower than budgeted volume. It is the difference between the expenses forecast in the original budget and
Revenues
Average payment period
Expense volume variance
Opening inventory
6. Organizational units responsible for their own costs that provide administrative support to other organizational units or the organization
Line of credit
Cash flows from operating activities
Realization principle
Administrative cost centers
7. The elapsed time between when the patient or third-party payor sends the payment and the time the health care provider receives the payment.
Float
Administrative cost centers
Administrative profit centers
Mail float
8. Private entity or individual who makes a donation
Non-current assets
Donor
Accounting period
Fixed Asset Turnover
9. The elapsed time between financial statements. Common accounting periods
Quick ratio
Accounting period
Liquidity ratios
Other income
10. A borrower's assets on which a lender has legal claim if a borrower defaults on a loan.
Collateral
Non-operating ratio
Bond rating agency
Lender
11. The total amount of multiyear debt due in future years.
Long-term debt - net of current portion
Net proceeds from a bond issuance
Statement of cash flows
Breakeven point
12. If a project is undertaken - these cash flows are the indirect increases or decreases in cash flows that will occur elsewhere in the organization.
Spillover cash flows
Billing float
Amortization of a loan
Mission Center
13. A method by which the organization develops its strategies and budgets to meet future financial targets.
Non-operating revenues
FTE
Coupon rate
Strategic financial planning
14. [Inventory/ (Cost of Goods Sold/365)]
Expenses
Average Days Inventory
Retained earnings
Capital appreciation
15. The budget that forecasts the operating and - in some cases - the non- operating revenues that will be earned during the budget period.
Hedge
Other income
Revenue budget
Times interest earned
16. The increase in the value of an investment from the time it is purchased until the time it is sold.
Tangible assets
Capital appreciation
Statement of cash flows
Traditional profit centers
17. An entity that sells bonds in order to raise money.
Issuer
Controlling activities
Permanently restricted net assets
Product diversity
18. Expenses of the organization incurred in non-health-care related activities.
Non-operating expenses
Billing - collections - and disbursement policies and procedures
Base Budget
Allowance for uncollectibles
19. The bottom line in the statement of operations. It includes such items as operating and non-operating income - contributions of long-lived assets - transfers to parent - and extraordinary items.
Net present value
Increase in unrestricted net assets
Base Budget
Lender
20. {current liabilities/[(total expenses
Average payment period
Program budget
Current ratio
Accounts payable
21. Activities that provide guidance and feedback to keep the organization within its budget - such as staff meetings - regular reports - and bonuses.
Debt to equity
Controlling activities
Average payment period
Annuity
22. Traces indirect costs to activity that uses them. Overhead collected in pools and distributed to cost object by cost drivers.
Common costs
Activity Based Costing
Non-operating income
Revenue enhancement
23. A balance sheet account that estimates the total amount of customer accounts receivable that will not be collected. It is also called allowance for bad debts and allowance for doubtful accounts.
Allowance for uncollectibles
Non-operating revenues
Line-item budget
Deferred revenues
24. The ease and speed with which an asset can be turned into cash.
Mortgage bonds
Cash flows from financing activities
Net increase (decrease) in cash and cash equivalents
Liquidity
25. How an organization chooses to finance its working capital needs.
Non-current assets
Accounts payable
Financing mix
Amortization of a loan
26. A budget in which line items are presented by program.
Beginning inventory
Prepaid assets
Accrued expenses
Program budget
27. Cash inflows and outflows for the organization resulting from investing activities such as purchasing and selling investments or investing in itself by purchasing or selling non-current assets. It also includes transfers to and from the parent corpor
Return on total assets
Cash flows from investing activities
Mutually exclusive projects
Breakeven point
28. Organizational unit given the responsibility to carry out one or more tasks and/or achieve one or more outcomes.
Net assets to total assets
Fixed assets
Net patient service revenue
Responsibility center
29. Current year budget projected for the coming fiscal year assumes no program changes and adjust for price - workload - annualizations
Base Budget
Book value
Mission statement
G & A expenses
30. Capital investment decisions designed to increase the operational capability of a health care organization.
Coupon
Expansion decisions
Fixed assets
Certainty
31. process of measuring the resources (costs) used to produce results.
Net assets to total assets
Cost Accounting
Centralization
FV
32. Cash flows that occur solely as a result of undertaking a project. Basically the marginal difference between alternatives.
Cash budget
Opening inventory
Incremental cash flows
Total asset turnover
33. Budgets that typically cover two to five years.
Multiyear budget
Non-regular cash flows
Operating activities
Mortgage bonds
34. The unit of service which we wish to know the cost for (hospital admission - classroom hour - course - etc.)
Operating income
Allocation base
Operating revenues
Final cost object
35. (excess of revenues over expenses/net assets)- In not-for-profit health care organizations - it measures the rate of return for each dollar in net assets. In for-profit organizations - it measures the rate of return for each dollar in owners' equity;
Return on net assets
Net assets released from restriction
Current assets
Opening inventory
36. A statement intended to guide the organization into the future by identifying the unique attributes of the organization - why it exists - and what it hopes to achieve.
ROI
Coupon payment
Mission statement
Float
37. 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
ROI
Cost
Not-for-profit
Time value of money
38. When different products use overhead related services in different proportions - and when the costs of those services are significantly different - The situation present when products consume overhead in different proportions.
Product diversity
Debt service coverage
Total revenue
Assets
39. A benefit paid for in advance (rent - insurance - etc.). Also called prepaid expense.
Ending inventory
Mortgage bonds
Capital structure decision
Prepaid assets
40. The amount of supplies used to provide a service or good.
Breakeven point
Certainty
Collections policies and procedures
Cost of goods sold
41. A form of long-term financing whereby the issuer receives cash and in return issues a note called a bond. By issuing the bond - the issuer agrees to make principal and/or interest payments on specific dates to the holders of the bond.
Net accounts receivable
Net Assets to Total Assets
Ending inventory
Bonds
42. The activities of an organization directly related to its main line of business.
Operating activities
Billing - collections - and disbursement policies and procedures
Ending inventory
Contribution margin
43. Amounts the organization is obligated to pay others - including suppliers and creditors.
Accounts payable
Accrual basis of accounting
Line-item budget
Long-term financing
44. 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.
Cash equivalents
Asset Management ratios
Service centers
Average payment period
45. Decisions regarding the relative amount of debt and equity used to finance the organization's non-current assets.
Budget variance
Properties and equipment - net
Top-down/bottom-up approach
Capital structure decision
46. Operating income plus other income. This is analogous to net income before taxes in for-profit entities.
Clinical cost centers
Statement of cash flows
Excess of revenues over expenses
Performance measure
47. The amount remaining after subtracting variable costs from revenues. When the organization is not at capacity - it is the "profit" the organization makes on providing each new unit that is available to cover all other costs. Contribution margin may b
Statement of changes in net assets
Contribution margin
Certainty
Expansion decisions
48. Assets that provide service for a period exceeding one year. Sometimes referred to as long-term assets.
Mail float
Non-current assets
Lease
Operating activities
49. [(excess of revenues over expenses + interest expense + depreciation expense)/(interest expense + principal payments))- A ratio that measures an organization's ability to pay back a loan. In for-profit organizations - it is calculated as: (net income
Efficiency
Cost avoidance
Lien
Debt service coverage
50. The revenue and expense budgets of an organization.
Non-operating revenues
Operating budget
Capital appreciation
Statement of cash flows