Test your basic knowledge |

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 method by which to distribute service center costs to mission centers; in general the one that most accurately measures use by the cost centers that receives its services (food service - # of meals - hospital laundry - # of pounds processed)






2. (excess of revenues over expenses/total assets)- A measure of how much profit is earned for each dollar invested in assets. In for-profit organizations it is called return on assets and is calculated as: net income/assets.






3. A legal obligation to pay the holder of the note or lien.






4. [(actual cost per unit -budgeted cost per unit) x actual volume).- The difference between the variable expenses that would have been expected at the actual volume and those actually incurred.






5. [(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






6. Assets that provide service for a period exceeding one year. Sometimes referred to as long-term assets.






7. An investment that generates an annuity for an indefinite period of time - basically forever.






8. Organizational unit given the responsibility to carry out one or more tasks and/or achieve one or more outcomes.






9. 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






10. Supplementing traditional sources of revenue with new sources.






11. 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






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






13. Ratios designed to answer the question: How profitable is the organization?






14. 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.






15. 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.






16. 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.






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






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






19. Debt to be paid off in a period longer than one year.






20. 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.






21. Decisions regarding the acquisition of capital assets. The capital investment decision should be separate from the decision on how to finance capital assets.






22. The process of distributing service center costs to mission centers - to determine the full cost of each mission center






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






24. 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.






25. A borrower's assets on which a lender has legal claim if a borrower defaults on a loan.






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






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






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






29. An entity that is owed money for lending funds or supplying goods or services on credit.






30. The budget that projects the organization's cash inflows and outflows. The bottom line in the cash budget is the amount of cash available at the end of the period.






31. 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.






32. Revenues generated from an organization's operating activities.






33. The method of capital budgeting that compares the cash flows resulting from continuing with the existing alternative to those that would result if the equipment were replaced.






34. The amount of supplies used to provide a service or good.






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






36. Cash flows that have been adjusted to their present value to account for the cost of capital (over time) and the time value of money.






37. Assets that have a physical presence.






38. The bottom area of the financial statements that contains key information not available in the body of the statements - such as how charity is determined - the composition of investments - which assets are restricted - and the depreciation method.






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






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






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






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






43. The budget used to forecast operating expenses.






44. The amount the holder of the coupon receives periodically - usually semiannually. Over the year - it equals the coupon rate times the face value of the bond.






45. Internal rate of return. The percentage return on an investment. It is the rate of return at which the net present value equals zero. Often used as a comparison to cost of capital.






46. 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






47. 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.






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






49. 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.






50. 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.







Sorry!:) No result found.

Can you answer 50 questions in 15 minutes?


Let me suggest you:

Browse all subjects

Browse all tests

Most popular tests



Major Subjects

Tests & Exams


AP
CLEP
DSST
GRE
SAT
GMAT

Browse all subjects

Browse all tests

Most popular tests