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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. 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).






2. Stated interest rate on a bond - as promised by the issuer.






3. One of the four major financial statements. It explains the changes in net assets from one period to the next on the balance sheet. Also called statement of changes in owners' equity in a for-profit business.






4. A certificate attached to a bond representing the amount of interest to be paid to the holder.






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






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






7. The activities of an organization directly related to its main line of business.






8. A schedule detailing the principal and interest payments required to repay a loan. Typically - the periodic payments remain unchanged - but the proportion used to payoff the principal increases over time.






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






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






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






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






13. 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.






14. IA category of non-current assets not intended to be used for operations - but only for capital appreciation and dividends - and that will be held for a period longer than one year.






15. (excess of revenues over expenses/total assets)- A measure of how much profit is earned for each dollar invested in assets. In for-profit organizations it is called return on assets and is calculated as: net income/assets.






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






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






18. 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






19. Budgets that typically cover two to five years.






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






21. The budget used to forecast - and in some cases justify - the expenditures (and in some cases the sources of financing) for non-current assets.






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






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






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






25. Costs not traced to a cost object - but that must eventually be allocated across cost objects. See also Direct costs.






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






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






28. Bonds that hold the health care provider's real property and equipment as security or collateral in case of default.






29. The delay between providing the service and getting the bill to the patient or third party. There are two aspects of billing float: assembling the bill and delivering the bill to the patient or third-party payor.






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






31. Funds provided by a private entity or individual without the requirement of repayment. Donations can either be restricted or unrestricted.






32. Recording expenses associated with making revenue at the same time as revenues are recognized






33. [(excess of revenues over expenses + interest expense)/interest expense].- This ratio enables creditors and lenders to evaluate an organization's ability to generate earnings necessary to meet interest expense requirements. In for-profit organization






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






35. Looks at the percentage change in a line item's value from one year to the next using the formula: [(subsequent year -base year)/base year) x 100. See also Vertical analysis.






36. Portion of the profits the organization keeps in-house to use in support of its mission.






37. The total amount of multiyear debt due in future years.






38. 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






39. Properties and equipment less accumulated depreciation.






40. An approach to analyzing the financial condition of an organization based on ratios calculated from line items found in the financial statements. There are four major categories of ratios: liquidity - profitability - capitalization - and activity.






41. The revenue and expense budgets of an organization.






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






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






44. Amounts given to the organization for operating purposes - such as governmental appropriations and unrestricted donations.






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






46. The elapsed time between when the patient or third-party payor sends the payment and the time the health care provider receives the payment.






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






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






49. (tax exempt revenue bonds)- Bonds in which the interest payments to the investor are exempt from the IRS. These bonds must be issued by an organization that has received tax exemption from the IRS and be used to fund projects that qualify as "exempt






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