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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. Cash inflows and outflows for the organization resulting from investing activities such as purchasing and selling investments or investing in itself by purchasing or selling non-current assets. It also includes transfers to and from the parent corpor






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






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






4. A good or service provided in return for some type of compensation.






5. 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






6. One of the four major financial statements. It summarizes the organization's revenues and expenses during an accounting period as well as other items that affect its unrestricted net assets. It is analogous to - but different from - an income stateme






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






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






10. (excess of revenues over expenses/net assets)- In not-for-profit health care organizations - it measures the rate of return for each dollar in net assets. In for-profit organizations - it measures the rate of return for each dollar in owners' equity;






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






12. The system of accounting that recognizes revenues when earned and expenses when resources are used. This method is used by most non-governmental health care organizations. See also Cash basis of accounting.






13. A security interest in one or more assets granted to lenders in a secured loan.






14. Non-operating income.






15. A form of long-term financing whereby the issuer receives cash and in return issues a note called a bond. By issuing the bond - the issuer agrees to make principal and/or interest payments on specific dates to the holders of the bond.






16. Gross proceeds less the underwriter's fee and other issuance fees.






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






18. Cash inflows and outflows resulting from financing activities - such as obtaining grants or endowments - or from borrowing or paying back long-term debt.






19. 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.






20. Market value. The price at which something - such as bonds and stocks - could be bought or sold today on the open market.






21. The absence of risk in an investment.






22. Proceeds lost by foregoing other opportunities.






23. The difference between current assets and current liabilities.






24. 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).






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






26. 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.






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






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






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






30. 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.






31. 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.






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






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






34. The rate of return required to undertake a project. Also called the hurdle rate or discount rate.






35. 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.






36. [net assets/total assets)- This ratio reflects the proportion of total assets financed by equity. In for-profit organizations it is called the equity to total asset ratio and is calculated using the formula [owners' equity/total assets).






37. 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.






38. A balance sheet account that estimates the total amount of customer accounts receivable that will not be collected. It is also called allowance for bad debts and allowance for doubtful accounts.






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






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






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






42. [(excess of revenues over expenses + interest expense + depreciation expense)/(interest expense + principal payments))- A ratio that measures an organization's ability to pay back a loan. In for-profit organizations - it is calculated as: (net income






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






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






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






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






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






48. Private entity or individual who makes a donation






49. [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






50. Each service center







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