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






2. [Total Liabilities/ Net assets]






3. A transaction that reduces the risk of an investment.






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






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






6. The idea that a dollar today is worth more than a dollar in the future.






7. Organizational units primarily responsible for providing services and earning a profit based on the health care services provided.






8. 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.






9. Responsibility centers responsible for making a certain return on investments.






10. Return on investment. The percentage gain or loss experienced from an investment.






11. The ability of an organization to find new ways to operate that obviate the need for certain classes of costs - such as doing procedures on an outpatient rather than inpatient basis.






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






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






14. [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?






15. Revenue is recorded when goods or services are delivered






16. The section of the expense budget that forecasts salary and benefits.






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






18. Activities that provide guidance and feedback to keep the organization within its budget - such as staff meetings - regular reports - and bonuses.






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






20. Current assets. Net working capital equals current assets –current liabilities.






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






22. Operating income plus other income. This is analogous to net income before taxes in for-profit entities.






23. (non-operating revenues/total operating revenues)- A ratio that reflects how dependent the organization is on non-patient care related net income.






24. 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






25. Being subject to sanctions with respect to carrying out responsibilities.






26. process of measuring the resources (costs) used to produce results.






27. Properties and equipment less accumulated depreciation.






28. Monies received that have not yet been earned. One of the most common deferred revenues is the receipt of capitation on the basis of per member per month (PMPM).






29. 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






30. The budget that forecasts the operating and - in some cases - the non- operating revenues that will be earned during the budget period.






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






32. Organizational unit given the responsibility to carry out one or more tasks and/or achieve one or more outcomes.






33. The difference between current assets and current liabilities.






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






35. Full-time equivalent employees. Two half-time employees equal one FTE.






36. When products are manufactured in batches in different sizes - and overhead activities are affected by the size of the batch being produced






37. The section of the statement of cash flows that reports the total change in cash and cash equivalents over the accounting period.






38. 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.






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






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






41. {current liabilities/[(total expenses






42. An entity that owns other companies.






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






44. The amount expected to be collected from payors. It is calculated as: gross accounts receivable – discounts and allowances – allowance for un-collectibles.






45. [(cash + marketable securities + net accounts receivable)/current liabilities)- A measure of the organization's liquidity.






46. A category of income that includes unrestricted interest - dividends - and gains from the sale of unrestricted investments.






47. The section of the expense budget that forecasts the cost of those supplies that will not vary as a direct result of changes in the amount of services provided (such as administrative office supplies).






48. The sources of funds to finance the non-current assets of the organization. Also the debt and equity of the organization.






49. The unit of service which we wish to know the cost for (hospital admission - classroom hour - course - etc.)






50. Decisions regarding the relative amount of debt and equity used to finance the organization's non-current assets.