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Test your basic knowledge |
ACCA Financial Management
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Study First
Subjects
:
certifications
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business-skills
,
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. 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).
Breakeven point
Fixed labor budget
Horizontal analysis
Administrative cost centers
2. [Total Liabilities/ Net assets]
Ratio analysis
Issuer
Cash budget
Debt to equity
3. The cost of activities that take place to produce the final cost object
Collateral
Intermediate Cost Object
Mission Center
Fixed supplies budget
4. Expenses of the organization incurred in non-health-care related activities.
Parent organization
Non-operating expenses
Capital financing
Days cash on hand
5. I) Measuring inputs against outputs. 2) The cost of service per unit rendered.
Income from investments
Net patient service revenue
Efficiency
Cost of goods sold
6. Assets that provide service for a period exceeding one year. Sometimes referred to as long-term assets.
Basic accounting equation
Non-current assets
For-profit
Average payment period
7. 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
Depreciation
Accounts receivable
ABC
Operating budget
8. A measure of the resources used to generate revenue and/or provide a service. Often used synonymously with costs. See also Costs.
Prepaid assets
Efficiency
Statement of changes in net assets
Expenses
9. Stated interest rate on a bond - as promised by the issuer.
Non-operating ratio
Coupon rate
Long-term debt - net of current portion
Other support
10. Current year budget projected for the coming fiscal year assumes no program changes and adjust for price - workload - annualizations
Service centers
Breakeven point
Base Budget
Current ratio
11. Future value. What an amount invested today (or a series of payments made over time) will be worth at a given time in the future using the compound interest method. This accounts for the time value of money. See also Present value.
Non-operating revenues
FV
Notes payable
Issuer
12. 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.
Step Down
Capital structure decision
Market rate of interest
Product diversity
13. A contract between a lender and a potential borrower preauthorizing the potential borrower's right to borrow up to a specific amount on request as long as they fulfill the terms and conditions of the contract. Also called a letter of credit.
Average payment period
Line of credit
Ratio analysis
Annuity
14. The idea that a dollar today is worth more than a dollar in the future.
G & A expenses
Average Days Receivable
Total asset turnover
Time value of money
15. A transaction that reduces the risk of an investment.
Comparative approach
Hedge
Assets
Current liabilities
16. The degree of dispersion of responsibility within an organization. See also Centralization.
Capital budget
Decentralization
Bonds
Net working capital
17. 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.
Accounting period
Common costs
Incremental cash flows
Cash flows from financing activities
18. 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.
Investment centers
Operating expenses
Top-down budgeting
Allowance for uncollectibles
19. When products are manufactured in batches in different sizes - and overhead activities are affected by the size of the batch being produced
Expansion decisions
Operating revenues
Volume diversity
Asset mix
20. The expenses incurred from an organization's operating activities.
Incremental cash flows
Single/Simple Step
Net accounts receivable
Operating expenses
21. The gradual process of paying off debt through a long series of equal periodic payments. Each payment covers a portion of the principal plus current interest. The periodic payments are equal over the lifetime of the loan - but the proportion going to
Amortization of a loan
Incremental cash flows
Net accounts receivable
Non-operating revenues
22. The budget that forecasts the operating and - in some cases - the non- operating revenues that will be earned during the budget period.
Revenue budget
Disbursement float
Strategic decisions
Not-for-profit
23. Private entity or individual who makes a donation
IRR
Cost centers
Controlling activities
Donor
24. Return on investment. The percentage gain or loss experienced from an investment.
Payback
ROI
Restricted donation
Acid test ratio
25. Organizational units primarily responsible for providing services and earning a profit based on the health care services provided.
Traditional profit centers
Liquidity
Operating income
ROI
26. The resources owned by the organization. It is one of the three major categories on the balance sheet.
Efficiency
Cost avoidance
Assets
Issuer
27. The changes in cash resulting from the normal operating activities of the organization.
Non-operating ratio
Working capital
Cash flows from operating activities
Liquidity ratios
28. 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.
Service centers
Accounts receivable
Non-regular cash flows
Intermediate Cost Object
29. Proceeds lost by foregoing other opportunities.
Opportunity cost
Line-item budget
Perpetuity
Time value of money
30. Amounts due to the organization from patients - third parties - and others.
Contribution margin
Cash budget
Non-operating expenses
Accounts receivable
31. [Net Accounts Receivable/(Revenue/356)]
Debt to equity
Comparative approach
Average Days Receivable
Net Assets to Total Assets
32. Supplementing traditional sources of revenue with new sources.
Realization principle
Debt service coverage
Non-regular cash flows
Revenue enhancement
33. The ease and speed with which an asset can be turned into cash.
Clinical cost centers
Efficiency
Liquidity
Capital budget
34. An entity that is owed money for lending funds or supplying goods or services on credit.
Opportunity cost
Capital financing
Creditor
Mortgage
35. Ratios that answer the question: How well is the organization positioned to meet its short-term obligations?
For-profit
Liquidity ratios
Clinical cost centers
Operating margin
36. Internal rate of return. The percentage return on an investment. It is the rate of return at which the net present value equals zero. Often used as a comparison to cost of capital.
Beginning inventory
Step Down
IRR
Controlling activities
37. Full-time equivalent employees. Two half-time employees equal one FTE.
Base Budget
Comparative approach
Coupon
FTE
38. Financial and non-financial standards against which organizational performance is measured.
Loan amortization schedule
Mortgage bonds
Restricted donation
Performance measure
39. process of measuring the resources (costs) used to produce results.
Expense volume variance
Current ratio
Cost Accounting
Interest
40. Assets that have a physical presence.
Net proceeds from a bond issuance
Tangible assets
Direct costs
Common costs
41. 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.
HMO
Centralization
Co-payments
Clinical cost centers
42. (non-operating revenues/total operating revenues)- A ratio that reflects how dependent the organization is on non-patient care related net income.
Current ratio
Non-operating ratio
Budget variance
MV
43. The elapsed time between financial statements. Common accounting periods
Coupon rate
Accounting period
Annuity
Beginning inventory
44. Operating income not reported elsewhere under revenues - gains - and other support.
Controlling activities
Other revenues
Fixed supplies budget
Coupon rate
45. A method by which the organization develops its strategies and budgets to meet future financial targets.
Program budget
Discounted cash flows
Average payment period
Strategic financial planning
46. Decisions regarding the acquisition of capital assets. The capital investment decision should be separate from the decision on how to finance capital assets.
Capital investment decisions
Fixed assets
Equity financing
Operating budget
47. [Total Revenues/(Net Fixed Assets)]. This ratio measures the number of dollars generated for each dollar invested in an organization's fixed assets (i.e. plant and equipment).
Properties and equipment - net
Fixed Asset Turnover
Non-operating ratio
Discount rate
48. Decisions regarding the relative amount of debt and equity used to finance the organization's non-current assets.
Net working capital
ROI
Return on total assets
Capital structure decision
49. A benefit paid for in advance (rent - insurance - etc.). Also called prepaid expense.
Prepaid assets
Non-regular cash flows
Decentralization
Times interest earned
50. A technique to evaluate an organization's strengths - weaknesses - opportunities - and threats. Also called a WOTS-up analysis.
Excess of revenues over expenses
SWOT analysis
Bond rating
Non-regular cash flows