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






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






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






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






5. 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.






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






7. 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.






8. Service center costs are allocated to both mission centers and other service centers






9. 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






10. Price times total quantity.






11. [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).






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






13. Non-operating income.






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






15. Responsibility centers responsible for making a certain return on investments.






16. 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






17. 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).






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






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






20. Proceeds lost by foregoing other opportunities.






21. 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.






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






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






24. 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






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






26. A certificate attached to a bond representing the amount of interest to be paid to the holder.






27. I) Measuring inputs against outputs. 2) The cost of service per unit rendered.






28. 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.






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






30. A method of allocating costs that are not directly paid for (utilities - rent - administration) into those products or services to which payment is attached (day of care - a brief visit). See also Activity-based costing.






31. Financial obligations that will be paid off over a time period longer than one year






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






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






34. I) Calculating interest using the compound interest method. 2) Adjusting for the time value of money forward in time to a future value. See also Compound interest method and Discounting.






35. A method by which the organization develops its strategies and budgets to meet future financial targets.






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






37. A statistic used to allocate costs from a cost center based on a cause and effect relationship. For example - a common allocation base to allocate the costs of maintaining medical records is number of visits. See also Cost driver.






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






39. Organizational units primarily responsible for ensuring that services are provided to a population in a manner that meets the volume and quality requirements of the organization. Service centers are the most basic type of responsibility centers.






40. A statement intended to guide the organization into the future by identifying the unique attributes of the organization - why it exists - and what it hopes to achieve.






41. {current liabilities/[(total expenses






42. Costs (such as rent - administration - insurance - etc. that are shared by a number of services or departments and cannot easily be broken down to the services attributable to each (surgery - emergency medicine - etc.). Also called joint costs.






43. [Surplus/Operating Revenues]






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






45. 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






46. The income (operating revenues -operating expenses) earned in non-health-care related activities.






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






48. The increase in the value of an investment from the time it is purchased until the time it is sold.






49. The budget used to forecast operating expenses.






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