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






2. The planning process that identifies the organization's mission and strategy in order to position itself for the future.






3. Generally - assets that will be used or consumed within one year. Some organizations use a period of less than one year.






4. [Net Accounts Receivable/(Revenue/356)]






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






6. 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.






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






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






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






10. 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






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






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






13. 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






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






15. Assets minus Liabilities. One of the three major categories on the balance sheet. Traditionally known as stockholders' equity in investor-owned organizations and fund balance in not-for-profit organizations. In not-for-profit health care organization






16. Bonds that have received a rating ranging from AM to BBB (at S&P) - or Aaa to Bbb (Moody's) - of which the highest are called quality ratings.






17. The degree of dispersion of responsibility within an organization. See also Centralization.






18. Price times total quantity.






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






20. 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.






21. The process of distributing service center costs to mission centers - to determine the full cost of each mission center






22. Series of payments over time - such as interest paid to bondholders.






23. Gross proceeds less the underwriter's fee and other issuance fees.






24. The increase in the value of an investment from the time it is purchased until the time it is sold.






25. Cash flows that have been adjusted to their present value to account for the cost of capital (over time) and the time value of money.






26. The current traded rate for similar risk securities.






27. [Inventory/ (Cost of Goods Sold/365)]






28. Traces indirect costs to activity that uses them. Overhead collected in pools and distributed to cost object by cost drivers.






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. Previously restricted assets no longer restricted because the terms of the restriction have been met.






31. The amount of supplies used to provide a service or good.






32. An entity that owns other companies.






33. [(cash + marketable securities)/current liabilities). A liquidity ratio that measures how much cash and marketable securities are available to payoff all current liabilities.






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






35. One of the four major financial statements. It summarizes the organization's revenues and expenses during an accounting period as well as other items that affect its unrestricted net assets. It is analogous to - but different from - an income stateme






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






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






38. The budget that projects the organization's cash inflows and outflows. The bottom line in the cash budget is the amount of cash available at the end of the period.






39. The changes in cash resulting from the normal operating activities of the organization.






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






41. Non-operating income.






42. The budget used to forecast operating expenses.






43. 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.






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






45. I) Measuring inputs against outputs. 2) The cost of service per unit rendered.






46. 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.






47. 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.






48. 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.






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






50. {current liabilities/[(total expenses