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. Ratios that answer the question: How well is the organization positioned to meet its short-term obligations?






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






3. Tools used to increase the amount of cash available to the organization. The objective of billing - credit - and collection policies is to accelerate cash receipts; the objective of cash disbursement policies is to slow down cash outflows.






4. The revenue and expense budgets of an organization.






5. 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.






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






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






8. The degree of dispersion of responsibility within an organization. See also Centralization.






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






10. The elapsed time between financial statements. Common accounting periods






11. [Total assets/Net Assets]






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






13. (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






14. 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.






15. Organizational units responsible for providing administrative support at a profit to other organizational units or to the organization as a whole and/or raising funds externally.






16. Assets that have a physical presence.






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






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






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






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






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






22. 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.






23. 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.






24. Non-operating income.






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






26. 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.






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






28. Proceeds lost by foregoing other opportunities.






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






30. The gradual process of paying off debt through a long series of equal periodic payments. Each payment covers a portion of the principal plus current interest. The periodic payments are equal over the lifetime of the loan - but the proportion going to






31. Assets = Liabilities + Net Assets (aka Equity).






32. An organization whose profits can be distributed outside the organization and must pay taxes. Also called investor-owned organizations.






33. (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;






34. Requiring the patient to pay part of his/her health care bill. These payments are used to prevent over-utilization of services.






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






36. [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






37. One of the four major financial statements. It answers the question: Where did our cash come from and where did it go during the accounting period?






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






39. [Total Revenues/ Total Assets]






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






41. Price times total quantity.






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






43. 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.






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






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






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






47. The central document of the planning/control cycle. It identifies revenues and resources that will be needed by an organization to achieve its goals and objectives.






48. [(excess of revenues over expenses + interest expense)/interest expense].- This ratio enables creditors and lenders to evaluate an organization's ability to generate earnings necessary to meet interest expense requirements. In for-profit organization






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






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