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






2. 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).






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






4. Ratios that measure how efficiently an organization is using its assets to produce revenues.






5. 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.






6. 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.






7. The budget format that lists revenues and expenses by category - such as labor - travel - and supplies. Categories are sometimes broken down into sub-categories. See also Performance budget and Program budget.






8. Activities that provide guidance and feedback to keep the organization within its budget - such as staff meetings - regular reports - and bonuses.






9. Agencies that assess the "credit worthiness" of an organization. The two major rating agencies are Moody's and Standard & Poor.






10. An entity that owns other companies.






11. The budget used to forecast operating expenses.






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






13. [operating income/total operating revenues]- The proportion of profit remaining after subtracting total operating expenses from operating revenues.






14. The current traded rate for similar risk securities.






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






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






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






18. A method to evaluate the feasibility of an investment by determining how long it would take until the initial investment is recovered. This method does not account for the time value of money.






19. Opposite of the authoritarian approach. The roles and responsibilities of the budgeting process are diffused throughout the organization. Often called the participatory approach.






20. [Total Liabilities/ Net assets]






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






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






23. 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.






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






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






26. The cost of the supplies on hand at the beginning of the year.






27. Financing used expressly for the purchase of non-current assets.






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






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






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






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






32. 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






33. The balance sheet category that includes actual money on hand as well as money equivalents - such as savings and checking accounts. It excludes cash restricted as to its use for something other than current operations.






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






35. 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.






36. Operating income plus other income. This is analogous to net income before taxes in for-profit entities.






37. 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






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






39. Assets that have a physical presence.






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






41. (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






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






43. The difference between current assets and current liabilities.






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






45. [Total assets/Net Assets]






46. The bottom line in the statement of operations. It includes such items as operating and non-operating income - contributions of long-lived assets - transfers to parent - and extraordinary items.






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






48. 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.






49. That process of budgeting where the environmental assessment and planning of future activities are largely decided upon by a few individuals - and the budget is essentially dictated to the rest of the organization. Often called authoritarian approach






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