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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. 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






2. An entity that temporarily grants the use of money or an asset to another in return for compensation - usually in the form of interest.






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






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






5. [Total Liabilities/ Net assets]






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






7. 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.






8. (non-operating revenues/total operating revenues)- A ratio that reflects how dependent the organization is on non-patient care related net income.






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






10. The costs of a service after taking into account its direct and fair share of allocated costs.






11. I) Organizations that have a special designation because they provide goods or services that result in needed community benefit. In turn - such organizations are not required to pay most taxes. 2) The designation of an organization as one that is not






12. Amounts given to the organization for operating purposes - such as governmental appropriations and unrestricted donations.






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






14. 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?






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






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






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






18. The percentage of each asset relative to total assets.






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






20. [Surplus/Operating Revenues]






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






22. A catchall category for miscellaneous expenses and losses not included in other categories (telephone - travel - meals - etc.).






23. The process of adjusting for the time value of money backward in time to present value. See also Compounding.






24. 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






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






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






27. [Total Revenues/ Total Assets]






28. 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.






29. 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






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






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






32. An organization's financial obligations that are to be paid within one year.






33. The amount of inventory on hand at the beginning of an accounting period. See also Ending inventory.






34. Bonds that have received a rating ranging from AM to BBB (at S&P) - or Aaa to Bbb (Moody's) - of which the highest are called quality ratings.






35. 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






36. Expenses of the organization incurred in non-health-care related activities.






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






38. [(actual volume -budgeted volume) x budgeted cost per unit).- The portion of total variance that is due to actual volume being either higher or lower than budgeted volume. It is the difference between the expenses forecast in the original budget and






39. The delay between providing the service and getting the bill to the patient or third party. There are two aspects of billing float: assembling the bill and delivering the bill to the patient or third-party payor.






40. Price times total quantity.






41. The planning process that identifies the organization's mission and strategy in order to position itself for the future.






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






43. The changes in cash resulting from the normal operating activities of the organization.






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






45. The current traded rate for similar risk securities.






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






47. [Total assets/Net Assets]






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






49. An entity that is owed money for lending funds or supplying goods or services on credit.






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