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Test your basic knowledge |
ACCA Financial Management
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Study First
Subjects
:
certifications
,
business-skills
,
acca
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. (non-operating revenues/total operating revenues)- A ratio that reflects how dependent the organization is on non-patient care related net income.
Net present value
Breakeven point
Fixed supplies budget
Non-operating ratio
2. The increase in the value of an investment from the time it is purchased until the time it is sold.
Capital appreciation
Liabilities
Revenues
Bond rating
3. An entity that sells bonds in order to raise money.
Issuer
Incremental cash flows
Accounting period
FTE
4. A series of equal cash flows made or received at regular time intervals. Ordinary annuities occur at the end of each period whereas annuities due occur at the beginning of each period.
Long-term debt to net assets ratio
Total asset turnover
Annuity
Discount rate
5. [(actual cost per unit -budgeted cost per unit) x actual volume).- The difference between the variable expenses that would have been expected at the actual volume and those actually incurred.
Expense cost variance
Activity ratios
Fixed supplies budget
Strategic decisions
6. Setting aside cash to meet unexpected demands - such as unexpected maintenance of a facility or piece of equipment.
Creditor
Precautionary purposes
Matching principle
Long Term Solvency ratios
7. A certificate attached to a bond representing the amount of interest to be paid to the holder.
Cash basis of accounting
Capital financing
Coupon
Net working capital
8. Any product - service - customer - contract - project - process or other work unit for which a separate cost measurement is desired.
Not-for-profit
Quick ratio
Cost object
Time value of money
9. Gross proceeds less the underwriter's fee and other issuance fees.
Cash flows from financing activities
Accrued expenses
Revenues
Net proceeds from a bond issuance
10. [Total Revenues/ Total Assets]
Asset Turnover Ratio
Bad debt
Fixed costs
Transaction
11. [(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
Interest
Investor
Capital budget
Debt service coverage
12. 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.
Footnotes
Depreciation
Disbursement float
Direct costs
13. How an organization chooses to finance its working capital needs.
Fixed assets
Activity ratios
Bonds
Financing mix
14. What a series of equal payments in the future is worth today taking into account the time value of money.
Present value of an annuity
Cost Accounting
Administrative cost centers
Other income
15. The cost of the supplies on hand at the beginning of the year.
Statement of operations
Opening inventory
Non-regular cash flows
Net present value
16. An entity that is owed money for lending funds or supplying goods or services on credit.
Creditor
Annuity
Cost
Fully allocated costs
17. The percentage of each asset relative to total assets.
Lease
Asset mix
Current assets
Average Days Inventory
18. Non-operating income.
Other income
Strategic decisions
Fixed asset turnover
Coupon payment
19. 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.
Total asset turnover
Billing - collections - and disbursement policies and procedures
Cost avoidance
Coupon payment
20. The budget used to forecast - and in some cases justify - the expenditures (and in some cases the sources of financing) for non-current assets.
Capital budget
Perpetuity
Certainty
Current assets
21. The sources of funds to finance the non-current assets of the organization. Also the debt and equity of the organization.
Capital
Expense cost variance
Base Budget
Centralization
22. The total amount of multiyear debt due in future years.
Operating cash flows
Long-term debt - net of current portion
FTE
Net Assets to Total Assets
23. A donation that has conditions which must be satisfied. See also Temporarily restricted net assets.
Restricted donation
Net Assets to Total Assets
Non-operating revenues
Performance measure
24. 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.
Asset Turnover Ratio
Perpetuity
Total revenue
Collections policies and procedures
25. Each service center
Asset Turnover Ratio
Capital financing
Statement of operations
Single/Simple Step
26. [Total Revenues/(Net Fixed Assets)]. This ratio measures the number of dollars generated for each dollar invested in an organization's fixed assets (i.e. plant and equipment).
Fixed Asset Turnover
Accounts receivable
Not-for-profit
Contribution margin
27. That process of budgeting where the environmental assessment and planning of future activities are largely decided upon by a few individuals - and the budget is essentially dictated to the rest of the organization. Often called authoritarian approach
Long Term Solvency ratios
Bond rating
Non-regular cash flows
Top-down budgeting
28. Current assets. Net working capital equals current assets –current liabilities.
Line of credit
Matching principle
Cash flows from investing activities
Working capital
29. {current liabilities/[(total expenses
Revenue budget
Discounted cash flows
Lender
Average payment period
30. Amounts given to the organization for operating purposes - such as governmental appropriations and unrestricted donations.
Other support
Acid test ratio
Discount rate
Co-payments
31. The current traded rate for similar risk securities.
Market rate of interest
Liabilities
Current liabilities
Balance sheet
32. A borrower's assets on which a lender has legal claim if a borrower defaults on a loan.
Collateral
Long-term debt - net of current portion
Discounting
Creditor
33. Directly related to the purposes of the organization and the delivery of services
Asset mix
G & A expenses
FV
Mission Center
34. Amounts the organization is obligated to pay others - including suppliers and creditors.
Non-operating expenses
Net present value
Accounts payable
Fixed asset turnover
35. Financing that will be paid back in less than one year.
Balance sheet
Mail float
SWOT analysis
Short-term financing
36. Portion of the profits the organization keeps in-house to use in support of its mission.
ROI
Depreciation
Accumulated depreciation
Retained earnings
37. 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.
Matching principle
Cost of capital
Increase in unrestricted net assets
Current ratio
38. The elapsed time between financial statements. Common accounting periods
Temporarily restricted net assets
Accounting period
Tangible assets
Lease
39. The costs of a service after taking into account its direct and fair share of allocated costs.
FV
Total revenue
Fully allocated costs
Fixed assets
40. A section of the statement of cash flows used to report such activities as borrowing and paying back loans.
Revenue rate variance
Increase in unrestricted net assets
Accounts payable
Financing activities
41. [operating income/total operating revenues]- The proportion of profit remaining after subtracting total operating expenses from operating revenues.
Current assets
Tangible assets
Increase in unrestricted net assets
Operating margin
42. Portion of profit an organization distributes to investors. By law - only investor-owned health care organizations can distribute dividends outside the organization.
Dividends
Donation
Investment grade
Incremental cash flows
43. Traces indirect costs to activity that uses them. Overhead collected in pools and distributed to cost object by cost drivers.
Activity Based Costing
Administrative cost centers
Net proceeds from a bond issuance
Cost centers
44. Revenues generated from an organization's operating activities.
Other income
Operating revenues
Present value of an annuity
Hedge
45. Assets that provide service for a period exceeding one year. Sometimes referred to as long-term assets.
Non-current assets
Service centers
Cost Accounting
Leverage
46. Amounts due to the organization from patients - third parties - and others.
Budget variance
Operating cash flows
Accounts receivable
Revenue budget
47. The balance sheet category that includes actual money on hand as well as money equivalents - such as savings and checking accounts. It excludes cash restricted as to its use for something other than current operations.
Cash and cash equivalents
Cost avoidance
Average Days Inventory
G & A expenses
48. 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
MV
Single/Simple Step
For-profit
Depreciation
49. The amount of supplies used to provide a service or good.
Retained earnings
G & A expenses
Net working capital
Cost of goods sold
50. Decisions regarding the acquisition of capital assets. The capital investment decision should be separate from the decision on how to finance capital assets.
Step-down method
Capital investment decisions
Traditional profit centers
Other income