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ACCA Financial Management

Instructions:
  • Answer 50 questions in 15 minutes.
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  • Match each statement with the correct term.
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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 purchase of assets with contributed and internally generated funds. See also Debt financing.






2. 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.






3. A note payable that has as collateral real assets and that requires periodic payments.






4. Supplementing traditional sources of revenue with new sources.






5. The rise in an economy's general level of prices.






6. The time between the issuance of the bill and the time funds are available for use by the health care organization. It has two components: mail float and processing float.






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






8. The amount of the total revenue variance that occurs because the actual average rate charged varies from that originally budgeted. It can be calculated using the formula: (actual rate -budgeted rate) x actual volume.






9. The elapsed time between financial statements. Common accounting periods






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






11. [Total Revenues/ Total Assets]






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






13. The costs of a service after taking into account its direct and fair share of allocated costs.






14. 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.






15. 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.






16. The central document of the planning/control cycle. It identifies revenues and resources that will be needed by an organization to achieve its goals and objectives.






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






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






19. A security whose interest rate does not change during the lifetime of the bond.






20. Directly related to the purposes of the organization and the delivery of services






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






22. Cash flows that occur solely as a result of undertaking a project. Basically the marginal difference between alternatives.






23. Amounts earned by the organization from the provision of service or sale of goods.






24. 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






25. Amounts due to the organization from patients - third parties - and others.






26. A benefit paid for in advance (rent - insurance - etc.). Also called prepaid expense.






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






28. Tools used to increase the amount of cash available to the organization. The objective of billing - credit - and collection policies is to accelerate cash receipts; the objective of cash disbursement policies is to slow down cash outflows.






29. Demonstrates the ability to pay off long term debt






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






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






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






33. Organizational units responsible for providing health care related services to clients - patients - or enrollees - and the related costs thereof.






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






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






36. 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.






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






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






39. (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






40. An entity that gives capital to another entity in expectation of a financial or non-financial return.






41. Health maintenance organization. Entities that receive premium payments from enrollees with the understanding that the HMO will be financially responsible for all predefined health care required by its enrollees for a specified period of time. The he






42. [current assets/current liabilities].- This liquidity ratio measures the proportion of all current assets to all current liabilities to determine how easily current debt can be paid off. It is one of the most commonly used ratios.






43. 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.






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






45. Time delays in the billing and collection process. There are four categories of float: billing - collection - transit - and disbursement. An organization's goal is to optimize float for incoming revenues and outgoing bills.






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






47. Any product - service - customer - contract - project - process or other work unit for which a separate cost measurement is desired.






48. The cumulative amount of depreciation recognized on an asset since its purchase. An asset's book value is equal to its purchase price less the amount of accumulated depreciation.






49. The amount of time between when an organization receives a service and pays for it.






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







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