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






2. Organizational units responsible for providing health care related services to clients - patients - or enrollees - and the related costs thereof.






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






4. The bottom line in the statement of operations. It includes such items as operating and non-operating income - contributions of long-lived assets - transfers to parent - and extraordinary items.






5. General and administrative expenses. Operating expenses that are not contained in the labor or supplies budgets.






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






7. Organizational units responsible for their own costs that provide administrative support to other organizational units or the organization






8. Portion of profit an organization distributes to investors. By law - only investor-owned health care organizations can distribute dividends outside the organization.






9. 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.






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






11. Decisions regarding the relative amount of debt and equity used to finance the organization's non-current assets.






12. A situation in which if one project is implemented the other(s) will not be.






13. [total revenues/net plant & equipment]- This ratio measures the number of dollars generated for each dollar invested in an organization's plant and equipment.






14. Revenue is recorded when goods or services are delivered






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






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






17. Each service center






18. 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.






19. 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






20. One of the four major financial statements. It explains the changes in net assets from one period to the next on the balance sheet. Also called statement of changes in owners' equity in a for-profit business.






21. Costs that stay the same in total over the relevant range as volume increases - but that change inversely on a per unit basis.






22. Costs not traced to a cost object - but that must eventually be allocated across cost objects. See also Direct costs.






23. A good or service provided in return for some type of compensation.






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






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






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






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






28. 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.






29. 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.






30. The elapsed time between when the patient or third-party payor sends the payment and the time the health care provider receives the payment.






31. 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.






32. 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






33. 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.






34. 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.






35. Assets that have a physical presence.






36. [(cash + marketable securities + net accounts receivable)/current liabilities)- A measure of the organization's liquidity.






37. 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).






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






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






40. Recording expenses associated with making revenue at the same time as revenues are recognized






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






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






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






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






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






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






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






48. 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.






49. (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;






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






Can you answer 50 questions in 15 minutes?



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