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






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






3. Irregular cash flows - typically occurring at the end of the life of a project.






4. process of measuring the resources (costs) used to produce results.






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






6. [Surplus/Operating Revenues]






7. Price times total quantity.






8. 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.






9. Expenses of the organization incurred in non-health-care related activities.






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






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






12. Revenues of the organization earned in non-healthcare related activities.






13. Assets that have restrictions on their use which will be removed either with the passage of time or the occurrence of some event.






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






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






16. 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.






17. The revenue that the organization has a right to collect. It is computed as: gross patient service revenues – contractual allowance and charity care.






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






19. The revenue and expense budgets of an organization.






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






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






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






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






24. An entity that owns other companies.






25. [long-term debt/net assets]- A measure of the proportion of an organization's assets that are financed by debt as opposed to equity. In for-profit organizations - it is called the long-term debt to equity ratio and is calculated using the formula [lo






26. The organization's legal obligations to pay its creditors. Liabilities are classified as current and non-current. Liabilities are one of the three major categories on the balance sheet and are part of the fundamental accounting equation.






27. The ability of an organization to find new ways to operate that obviate the need for certain classes of costs - such as doing procedures on an outpatient rather than inpatient basis.






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






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






30. 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.






31. The difference between the initial amount paid for an investment and the related future cash inflows after they have been adjusted (discounted) by the cost of capital.






32. The system of accounting that recognizes revenues when cash is received and expenses when cash is paid out. See also Accrual basis of accounting.






33. Being subject to sanctions with respect to carrying out responsibilities.






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






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






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






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






38. [Total assets/Net Assets]






39. A budget which presents not only line items and programs but also the performance goals that each program can be expected to attain. See also Line item budget and Program budget.






40. An amount owed to the organization that will not be paid. Charity care is not considered a bad debt since nothing is owed to the organization for services provided.






41. 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.






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






43. Demonstrates the extent to which the organization is earning money from its assets. Not usually as imp for NPs - varies w/ NP.






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






45. 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.






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






47. [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.






48. 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).






49. Demonstrates the ability to pay off long term debt






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