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Test your basic knowledge |
ACCA Financial Management
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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 income.
Current ratio
Asset Turnover Ratio
Other income
Accounts payable
2. [(cash + marketable securities + net accounts receivable)/current liabilities)- A measure of the organization's liquidity.
Accrued expenses
Quick ratio
Operating margin
Realization principle
3. Market value. The price at which something - such as bonds and stocks - could be bought or sold today on the open market.
Breakeven point
MV
Revenue enhancement
Net accounts receivable
4. Requiring the patient to pay part of his/her health care bill. These payments are used to prevent over-utilization of services.
Non-regular cash flows
Long-term debt - net of current portion
Activity Based Costing
Co-payments
5. Each service center
Long-term investments
Single/Simple Step
Debt to equity
Not-for-profit
6. A security interest in one or more assets granted to lenders in a secured loan.
Lien
Strategic planning
Prepaid assets
Cash equivalents
7. The cost of a capital asset (i.e. building or equipment) minus accumulated depreciation.
Book value
Income from investments
Loan amortization schedule
Efficiency
8. 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.
Cash flows from financing activities
Billing float
Operating cash flows
Allocation
9. Debt to be paid off in a period longer than one year.
Long-term financing
Product diversity
Operating income
Days cash on hand
10. Cash inflows and outflows resulting from financing activities - such as obtaining grants or endowments - or from borrowing or paying back long-term debt.
Long-term debt to net assets ratio
Revenue budget
Cash flows from financing activities
HMO
11. 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.
Profitability ratios
Contribution margin
Average Days Receivable
Statement of changes in net assets
12. If a project is undertaken - these cash flows are the indirect increases or decreases in cash flows that will occur elsewhere in the organization.
Excess of revenues over expenses
Step-down method
Spillover cash flows
Cash flows from financing activities
13. A balance sheet account that estimates the total amount of customer accounts receivable that will not be collected. It is also called allowance for bad debts and allowance for doubtful accounts.
Volume diversity
Allowance for uncollectibles
Cash equivalents
G & A expenses
14. The percentage of each asset relative to total assets.
Not-for-profit
Notes payable
Payback
Asset mix
15. A measure of the income earned from operating activities. It is calculated as: unrestricted revenues - gains - and other support -expenses and losses.
Permanently restricted net assets
Liquidity ratios
Operating income
Properties and equipment
16. Operating income plus other income. This is analogous to net income before taxes in for-profit entities.
Current liabilities
Excess of revenues over expenses
Long Term Solvency ratios
Current assets
17. The cost of activities that take place to produce the final cost object
Intermediate Cost Object
Liquidity ratios
Leverage
Non-current assets
18. Amounts the organization is obligated to pay others - including suppliers and creditors.
Operating revenues
Accounts payable
FV
Cost avoidance
19. {[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).
ROI
Balance sheet
Long-term investments
Days cash on hand
20. The difference between the initial amount paid for an investment and the related future cash inflows after they have been adjusted (discounted) by the cost of capital.
Net present value
Non-operating ratio
Final cost object
Quick ratio
21. Organizational units responsible for providing services and controlling their costs. There are two major types: clinical cost centers and administrative cost centers.
Administrative cost centers
Fixed labor budget
Decentralization
Cost centers
22. I) Calculating interest using the compound interest method. 2) Adjusting for the time value of money forward in time to a future value. See also Compound interest method and Discounting.
Times interest earned
Compounding
Contribution margin
Liquidity ratios
23. Activities that provide guidance and feedback to keep the organization within its budget - such as staff meetings - regular reports - and bonuses.
Mission Center
Controlling activities
Non-current liabilities
Return on net assets
24. Gross proceeds less the underwriter's fee and other issuance fees.
Short-term financing
Market rate of interest
Multiyear budget
Net proceeds from a bond issuance
25. Revenue is recorded when goods or services are delivered
Collections policies and procedures
Cost object
Realization principle
Asset Turnover Ratio
26. 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.
IRR
Horizontal analysis
Fixed asset turnover
Efficiency
27. An assignment or grading of the likelihood that an organization will not default on a bond.
Net proceeds from a bond issuance
Other expenses
Bond rating
Accounts payable
28. Opposite of the authoritarian approach. The roles and responsibilities of the budgeting process are diffused throughout the organization. Often called the participatory approach.
Expense budget
Responsibility center
Long-term debt to net assets ratio
Top-down/bottom-up approach
29. Traces indirect costs to activity that uses them. Overhead collected in pools and distributed to cost object by cost drivers.
Non-current assets
Fixed (interest) rate debt
Loan amortization schedule
Activity Based Costing
30. Recording expenses associated with making revenue at the same time as revenues are recognized
Administrative cost centers
Matching principle
Capital
Non-operating expenses
31. 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.
Market rate of interest
Horizontal analysis
Expense budget
Fixed supplies budget
32. The expenses incurred from an organization's operating activities.
Operating expenses
Mission statement
Working capital
Non-current assets
33. Donated assets that have restrictions on their use which will never be removed.
Multiyear budget
Volume diversity
Responsibility center
Permanently restricted net assets
34. An organization's financial obligations that are to be paid within one year.
Current liabilities
Capital investment decisions
Fixed assets
Total revenue
35. Costs not traced to a cost object - but that must eventually be allocated across cost objects. See also Direct costs.
Indirect costs
Expansion decisions
Compounding
Net present value
36. 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
Strategic planning
Present value of an annuity
Fixed Asset Turnover
Not-for-profit
37. Previously restricted assets no longer restricted because the terms of the restriction have been met.
Net assets released from restriction
Cost Accounting
Quick ratio
Cost
38. 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.
Accrual basis of accounting
Allocation base
Revenue rate variance
Expenses
39. A section of the statement of cash flows used to report such activities as borrowing and paying back loans.
Financing activities
Direct costs
Donor
Net Assets to Total Assets
40. The cash flows derived from an organization's operating activities.
Operating cash flows
Cost avoidance
Net Assets
Capital budget
41. Organizational units responsible for their own costs that provide administrative support to other organizational units or the organization
Expense volume variance
Net proceeds from a bond issuance
Cash flows from financing activities
Administrative cost centers
42. A donation that has conditions which must be satisfied. See also Temporarily restricted net assets.
Net proceeds from a bond issuance
Cash flows from financing activities
Top-down/bottom-up approach
Restricted donation
43. Organizational unit given the responsibility to carry out one or more tasks and/or achieve one or more outcomes.
Net assets to total assets
Mail float
Non-regular cash flows
Responsibility center
44. The budget format that lists revenues and expenses by category - such as labor - travel - and supplies. Categories are sometimes broken down into sub-categories. See also Performance budget and Program budget.
Capital structure decision
Administrative profit centers
Line-item budget
Financing mix
45. How an organization chooses to finance its working capital needs.
Financing mix
Cost avoidance
Opening inventory
Asset Management ratios
46. Current year budget projected for the coming fiscal year assumes no program changes and adjust for price - workload - annualizations
Asset mix
Base Budget
Statement of operations
Other expenses
47. Return on investment. The percentage gain or loss experienced from an investment.
Fixed costs
Net proceeds from a bond issuance
ROI
Budget
48. [Net Accounts Receivable/(Revenue/356)]
Basis of Allocation
Discounted cash flows
Average Days Receivable
Long-term debt to net assets ratio
49. The difference between current assets and current liabilities.
Mission Center
Net working capital
Expense cost variance
Product diversity
50. Supplementing traditional sources of revenue with new sources.
Collections policies and procedures
Budget
Fixed costs
Revenue enhancement