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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. Debt to be paid off in a period longer than one year.






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






3. 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.






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






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






6. The system of accounting that recognizes revenues when cash is received and expenses when cash is paid out. See also Accrual basis of accounting.






7. The absence of risk in an investment.






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






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






10. 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






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






12. The cash flows derived from an organization's operating activities.






13. A technique to evaluate an organization's strengths - weaknesses - opportunities - and threats. Also called a WOTS-up analysis.






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






15. A donation that has conditions which must be satisfied. See also Temporarily restricted net assets.






16. The section of the expense budget that forecasts salary and benefits.






17. Donated assets that have restrictions on their use which will never be removed.






18. [Inventory/ (Cost of Goods Sold/365)]






19. 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






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






21. Budgets that typically cover two to five years.






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






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






24. Ratios that answer the question: How well is the organization positioned to meet its short-term obligations?






25. The elapsed time between financial statements. Common accounting periods






26. The total amount of multiyear debt due in future years.






27. The cost of the supplies on hand at the beginning of the year.






28. A transaction that reduces the risk of an investment.






29. The ease and speed with which an asset can be turned into cash.






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






31. Operating income plus other income. This is analogous to net income before taxes in for-profit entities.






32. [Surplus/Operating Revenues]






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






34. A budget in which line items are presented by program.






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






36. Assets minus Liabilities. One of the three major categories on the balance sheet. Traditionally known as stockholders' equity in investor-owned organizations and fund balance in not-for-profit organizations. In not-for-profit health care organization






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






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






39. Assets that have a physical presence.






40. A benefit paid for in advance (rent - insurance - etc.). Also called prepaid expense.






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






42. Return on investment. The percentage gain or loss experienced from an investment.






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






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






45. 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.






46. 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






47. A security whose interest rate does not change during the lifetime of the bond.






48. (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;






49. Proceeds lost by foregoing other opportunities.






50. [Total Liabilities/ Net assets]