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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 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.






2. Current year budget projected for the coming fiscal year assumes no program changes and adjust for price - workload - annualizations






3. 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






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






5. 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.






6. Private entity or individual who makes a donation






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






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






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






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






11. 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.






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






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






14. The percentage of each asset relative to total assets.






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






16. The resources owned by the organization. It is one of the three major categories on the balance sheet.






17. [(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






18. Literally non-movable assets. Generally used to refer to buildings and equipment.






19. A statistic used to allocate costs from a cost center based on a cause and effect relationship. For example - a common allocation base to allocate the costs of maintaining medical records is number of visits. See also Cost driver.






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






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






23. A method by which the organization develops its strategies and budgets to meet future financial targets.






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






25. 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






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






27. 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.






28. 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).






29. 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.






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






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






32. 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.






33. Budgets that typically cover two to five years.






34. The ease and speed with which an asset can be turned into cash.






35. 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






36. Costs that are traced to a cost object. See also Indirect costs and Cost object.






37. An entity that owns other companies.






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






39. 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






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






41. {current liabilities/[(total expenses






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






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






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






45. Each service center






46. [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?






47. 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






48. 1) The resources used to produce a good or service. 2) The amount of cash given up in a transaction. 3) Price. The first definition is based on accrual accounting and the second on cash accounting.






49. 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.






50. Financial obligations that will be paid off over a time period longer than one year