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






2. 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






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






4. An entity that sells bonds in order to raise money.






5. The degree to which standards are met.






6. The activities of an organization directly related to its main line of business.






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






8. 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.






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






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






11. The section of the expense budget that forecasts the cost of those supplies that will not vary as a direct result of changes in the amount of services provided (such as administrative office supplies).






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






13. 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.






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






15. A budget which presents not only line items and programs but also the performance goals that each program can be expected to attain. See also Line item budget and Program budget.






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






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






18. Setting aside cash to meet unexpected demands - such as unexpected maintenance of a facility or piece of equipment.






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






20. The absence of risk in an investment.






21. The current traded rate for similar risk securities.






22. Supplementing traditional sources of revenue with new sources.






23. [(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






24. [total revenues/total assets].- This ratio measures the overall efficiency of the organization's assets to produce revenue. It answers the question: For every dollar in assets - how many dollars of revenue are being generated?






25. 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






26. 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.






27. An organization's financial obligations that are to be paid within one year.






28. Amounts given to the organization for operating purposes - such as governmental appropriations and unrestricted donations.






29. Demonstrates the extent to which the organization is earning money from its assets. Not usually as imp for NPs - varies w/ NP.






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






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






32. The revenue and expense budgets of an organization.






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






34. 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.






35. When products are manufactured in batches in different sizes - and overhead activities are affected by the size of the batch being produced






36. Directly related to the purposes of the organization and the delivery of services






37. 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.






38. Demonstrates the ability to pay off long term debt






39. An approach to analyzing the financial condition of an organization based on ratios calculated from line items found in the financial statements. There are four major categories of ratios: liquidity - profitability - capitalization - and activity.






40. Any product - service - customer - contract - project - process or other work unit for which a separate cost measurement is desired.






41. Policies and procedures that address when and how to collect revenues - such as paying at time of service - sending accounts to collection agencies - and writing off accounts as bad debt.






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






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






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






45. The planning process that identifies the organization's mission and strategy in order to position itself for the future.






46. 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






47. Ratios that measure how the organization's assets are financed and/or whether the organization can take on new debt.






48. Revenues of the organization earned in non-healthcare related activities.






49. Traces indirect costs to activity that uses them. Overhead collected in pools and distributed to cost object by cost drivers.






50. The cost of activities that take place to produce the final cost object