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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. Market value. The price at which something - such as bonds and stocks - could be bought or sold today on the open market.






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






3. Cash inflows and outflows resulting from financing activities - such as obtaining grants or endowments - or from borrowing or paying back long-term debt.






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






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






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






7. An entity that gives capital to another entity in expectation of a financial or non-financial return.






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






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






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






11. A schedule detailing the principal and interest payments required to repay a loan. Typically - the periodic payments remain unchanged - but the proportion used to payoff the principal increases over time.






12. Proceeds lost by foregoing other opportunities.






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






14. 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






15. If a project is undertaken - these cash flows are the indirect increases or decreases in cash flows that will occur elsewhere in the organization.






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






17. 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).






18. 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.






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






20. Private entity or individual who makes a donation






21. {[cash + marketable securities)/[(operating expenses -depreciation)/ 365].- A ratio that indicates the number of days' worth of expenses an organization can cover with its most liquid assets (cash and marketable securities).






22. Amounts due to the organization from patients - third parties - and others.






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






24. 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?






25. Internal rate of return. The percentage return on an investment. It is the rate of return at which the net present value equals zero. Often used as a comparison to cost of capital.






26. The method by which to distribute service center costs to mission centers; in general the one that most accurately measures use by the cost centers that receives its services (food service - # of meals - hospital laundry - # of pounds processed)






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






28. Literally non-movable assets. Generally used to refer to buildings and equipment.






29. I) Measuring inputs against outputs. 2) The cost of service per unit rendered.






30. 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.






31. The revenue and expense budgets of an organization.






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






33. The budget that projects the organization's cash inflows and outflows. The bottom line in the cash budget is the amount of cash available at the end of the period.






34. 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.






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






36. Amounts earned by the organization from the provision of service or sale of goods.






37. A measure of the resources used to generate revenue and/or provide a service. Often used synonymously with costs. See also Costs.






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






39. 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.






40. Organizational units responsible for providing services and controlling their costs. There are two major types: clinical cost centers and administrative cost centers.






41. The system of accounting that recognizes revenues when earned and expenses when resources are used. This method is used by most non-governmental health care organizations. See also Cash basis of accounting.






42. Responsibility centers responsible for making a certain return on investments.






43. 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






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






45. Decisions regarding the acquisition of capital assets. The capital investment decision should be separate from the decision on how to finance capital assets.






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






47. (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.






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






49. Non-operating income.






50. The unit of service which we wish to know the cost for (hospital admission - classroom hour - course - etc.)