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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. Organizational units responsible for providing health care related services to clients - patients - or enrollees - and the related costs thereof.






2. What a series of equal payments in the future is worth today taking into account the time value of money.






3. Assets = Liabilities + Net Assets (aka Equity).






4. An organization's financial obligations that are to be paid within one year.






5. The method of capital budgeting that compares the cash flows resulting from continuing with the existing alternative to those that would result if the equipment were replaced.






6. A catchall category for miscellaneous expenses and losses not included in other categories (telephone - travel - meals - etc.).






7. The purchase of assets with contributed and internally generated funds. See also Debt financing.






8. Revenues generated from an organization's operating activities.






9. An entity that temporarily grants the use of money or an asset to another in return for compensation - usually in the form of interest.






10. Ratios that answer the question: How well is the organization positioned to meet its short-term obligations?






11. 1) The degree to which power and authority is concentrated in an organization. 2) The degree to which a variety of services are offered at a single location.






12. The cumulative amount of depreciation recognized on an asset since its purchase. An asset's book value is equal to its purchase price less the amount of accumulated depreciation.






13. A contract in which the lessee (user) agrees to pay the leassor (owner) a specific amount over a period of time for the use of an asset.






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






15. An assignment or grading of the likelihood that an organization will not default on a bond.






16. I) Calculating interest using the compound interest method. 2) Adjusting for the time value of money forward in time to a future value. See also Compound interest method and Discounting.






17. A section of the statement of cash flows used to report such activities as borrowing and paying back loans.






18. 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






19. An investment that generates an annuity for an indefinite period of time - basically forever.






20. 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






21. 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.






22. The expenses incurred from an organization's operating activities.






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






24. An entity that sells bonds in order to raise money.






25. Costs (such as rent - administration - insurance - etc. that are shared by a number of services or departments and cannot easily be broken down to the services attributable to each (surgery - emergency medicine - etc.). Also called joint costs.






26. The cost of a capital asset (i.e. building or equipment) minus accumulated depreciation.






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






28. Capital investment decisions designed to increase the operational capability of a health care organization.






29. A series of equal cash flows made or received at regular time intervals. Ordinary annuities occur at the end of each period whereas annuities due occur at the beginning of each period.






30. Financial and non-financial standards against which organizational performance is measured.






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






32. The cost of the supplies on hand at the beginning of the year.






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






34. [Total assets/Net Assets]






35. The central document of the planning/control cycle. It identifies revenues and resources that will be needed by an organization to achieve its goals and objectives.






36. [total revenues/net plant & equipment]- This ratio measures the number of dollars generated for each dollar invested in an organization's plant and equipment.






37. [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?






38. 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.






39. Private entity or individual who makes a donation






40. Organizational units responsible for their own costs that provide administrative support to other organizational units or the organization






41. Health maintenance organization. Entities that receive premium payments from enrollees with the understanding that the HMO will be financially responsible for all predefined health care required by its enrollees for a specified period of time. The he






42. Donated assets that have restrictions on their use which will never be removed.






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






44. Opposite of the authoritarian approach. The roles and responsibilities of the budgeting process are diffused throughout the organization. Often called the participatory approach.






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






46. A measure of the resources used to generate revenue and/or provide a service. Often used synonymously with costs. See also Costs.






47. Policies and procedures that address when and how to collect revenues - such as paying at time of service - sending accounts to collection agencies - and writing off accounts as bad debt.






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






49. An entity that is owed money for lending funds or supplying goods or services on credit.






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