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 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).






2. 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.






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






4. The rise in an economy's general level of prices.






5. The amount of the total revenue variance that occurs because the actual average rate charged varies from that originally budgeted. It can be calculated using the formula: (actual rate -budgeted rate) x actual volume.






6. Financing used expressly for the purchase of non-current assets.






7. 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






8. 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






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






10. 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.






11. 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).






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






13. Supplementing traditional sources of revenue with new sources.






14. Current assets. Net working capital equals current assets –current liabilities.






15. 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.






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






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






18. Health maintenance organization. Entities that receive premium payments from enrollees with the understanding that the HMO will be financially responsible for all predefined health care required by its enrollees for a specified period of time. The he






19. Highly liquid current assets such as interest-bearing savings and checking accounts.






20. What a series of equal payments in the future is worth today taking into account the time value of money.






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






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






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






24. The cumulative amount of depreciation recognized on an asset since its purchase. An asset's book value is equal to its purchase price less the amount of accumulated depreciation.






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






26. The budget that forecasts the operating and - in some cases - the non- operating revenues that will be earned during the budget period.






27. The amount remaining after subtracting variable costs from revenues. When the organization is not at capacity - it is the "profit" the organization makes on providing each new unit that is available to cover all other costs. Contribution margin may b






28. The revenue and expense budgets of an organization.






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






30. 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.






31. Full-time equivalent employees. Two half-time employees equal one FTE.






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






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






34. The organization's legal obligations to pay its creditors. Liabilities are classified as current and non-current. Liabilities are one of the three major categories on the balance sheet and are part of the fundamental accounting equation.






35. {current liabilities/[(total expenses






36. 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






37. (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.






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






39. Budgets that typically cover two to five years.






40. [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






41. Capital investment decisions designed to increase an organization's strategic position.






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






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






44. [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).






45. [(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






46. The time between the issuance of the bill and the time funds are available for use by the health care organization. It has two components: mail float and processing float.






47. The amount expected to be collected from payors. It is calculated as: gross accounts receivable – discounts and allowances – allowance for un-collectibles.






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






49. [(cash + marketable securities)/current liabilities). A liquidity ratio that measures how much cash and marketable securities are available to payoff all current liabilities.






50. Assets that have a useful life greater than one year - such as plant - property - and equipment. Plant and equipment are depreciated over time; land (property) is not.






Can you answer 50 questions in 15 minutes?



Let me suggest you:



Major Subjects



Tests & Exams


AP
CLEP
DSST
GRE
SAT
GMAT

Most popular tests