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Test your basic knowledge |
ACCA Financial Management
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Study First
Subjects
:
certifications
,
business-skills
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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. 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
HMO
Comparative approach
MV
Interest
2. Cash inflows and outflows resulting from financing activities - such as obtaining grants or endowments - or from borrowing or paying back long-term debt.
Issuer
Increase in unrestricted net assets
Cost Accounting
Cash flows from financing activities
3. I) Measuring inputs against outputs. 2) The cost of service per unit rendered.
Donor
Cash equivalents
Efficiency
Accountability
4. Financial obligations that will be paid off over a time period longer than one year
Non-current liabilities
Allocation
Billing - collections - and disbursement policies and procedures
Accounting period
5. The rise in an economy's general level of prices.
Beginning inventory
Operating budget
Prepaid assets
Inflation
6. 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.
Fixed costs
Investment grade
Bonds
Incremental cash flows
7. Stated interest rate on a bond - as promised by the issuer.
Operating expenses
Coupon rate
Discounted cash flows
Accrued expenses
8. A situation in which if one project is implemented the other(s) will not be.
Lease
Mutually exclusive projects
IRR
Line of credit
9. The rate of return required to undertake a project. Also called the hurdle rate or discount rate.
Efficiency
Step Down
Allowance for uncollectibles
Cost of capital
10. A benefit paid for in advance (rent - insurance - etc.). Also called prepaid expense.
Prepaid assets
Collateral
Fixed labor budget
Capital budget
11. The revenue and expense budgets of an organization.
Operating budget
Compounding
Coupon rate
Present value of an annuity
12. [Total assets/Net Assets]
Leverage
Coupon payment
Bond rating
Beginning inventory
13. The amount of supplies used to provide a service or good.
Cost of goods sold
Discount rate
Non-current liabilities
Ending inventory
14. Decisions regarding the acquisition of capital assets. The capital investment decision should be separate from the decision on how to finance capital assets.
Equity financing
Coupon payment
Capital investment decisions
Cost of capital
15. {[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).
Revenue enhancement
Days cash on hand
Compounding
Non-current assets
16. 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.
Allocation base
Capital financing
Investment centers
Annuity
17. 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.
Lien
Budget
Cash basis of accounting
Line-item budget
18. Supplementing traditional sources of revenue with new sources.
Increase in unrestricted net assets
Cost
Revenue enhancement
Fixed (interest) rate debt
19. Each service center
Step-down method
Single/Simple Step
Asset Management ratios
Breakeven point
20. Activities that provide guidance and feedback to keep the organization within its budget - such as staff meetings - regular reports - and bonuses.
Controlling activities
Interest
Cash and cash equivalents
Cash flows from financing activities
21. The amount expected to be collected from payors. It is calculated as: gross accounts receivable – discounts and allowances – allowance for un-collectibles.
Asset mix
Net accounts receivable
Average payment period
Fixed labor budget
22. An organization's financial obligations that are to be paid within one year.
Current liabilities
Direct costs
Profit margin
Long-term investments
23. Ratios designed to answer the question: How profitable is the organization?
Fixed assets
Interest
Profitability ratios
Capital appreciation
24. Recording expenses associated with making revenue at the same time as revenues are recognized
Matching principle
Strategic financial planning
Working capital
Statement of operations
25. The degree to which standards are met.
Mortgage
Effectiveness
Assets
Service centers
26. Amounts earned by the organization from the provision of service or sale of goods.
Bad debt
Cash flows from operating activities
Revenue enhancement
Revenues
27. Funds provided by a private entity or individual without the requirement of repayment. Donations can either be restricted or unrestricted.
Cost Accounting
Donation
Single/Simple Step
Properties and equipment
28. 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)
Basis of Allocation
Bond rating agency
Opportunity cost
Certainty
29. 1) The returns that must be generated on a project to compensate the organization for its risk. 2) The returns the organization is foregoing by investing its money in one project as opposed to an alternative of similar risk. See also Cost of capital.
Cost object
Discount rate
Budget variance
Leverage
30. Demonstrates the ability to pay off long term debt
Current ratio
Lender
Non-current assets
Long Term Solvency ratios
31. One of the four major financial statements of a health care organization. It presents a summary of the organization's assets - liabilities - and net assets as of a certain date.
Long Term Solvency ratios
Balance sheet
Bonds
Fixed asset turnover
32. Assets that provide service for a period exceeding one year. Sometimes referred to as long-term assets.
Net assets released from restriction
Book value
Annuity
Non-current assets
33. 1) The resources used to produce a good or service. 2) The amount of cash given up in a transaction. 3) Price. The first definition is based on accrual accounting and the second on cash accounting.
Collection float
Cost object
Cost
Beginning inventory
34. Assets that have restrictions on their use which will be removed either with the passage of time or the occurrence of some event.
Temporarily restricted net assets
Mission statement
Cash flows from financing activities
Effectiveness
35. 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.
Accounts payable
Statement of changes in net assets
Net increase (decrease) in cash and cash equivalents
Expansion decisions
36. A transaction that reduces the risk of an investment.
Controlling activities
Hedge
Multiyear budget
Investment grade
37. Organizational units responsible for providing health care related services to clients - patients - or enrollees - and the related costs thereof.
Cash flows from operating activities
Mortgage
Present value of an annuity
Clinical cost centers
38. 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.
Cash basis of accounting
Bond rating agency
FV
Capital assets
39. Service center costs are allocated to both mission centers and other service centers
Fixed assets
Step Down
Direct costs
Efficiency
40. A section of the statement of cash flows used to report such activities as borrowing and paying back loans.
Expense volume variance
Depreciation
Mail float
Financing activities
41. 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.
Mutually exclusive projects
Working capital
Increase in unrestricted net assets
Donation
42. The planning process that identifies the organization's mission and strategy in order to position itself for the future.
Mail float
Strategic planning
Allocation base
Fixed supplies budget
43. Literally non-movable assets. Generally used to refer to buildings and equipment.
Activity ratios
Loan amortization schedule
Fixed assets
Certainty
44. Current year budget projected for the coming fiscal year assumes no program changes and adjust for price - workload - annualizations
Base Budget
Present value of an annuity
Basis of Allocation
Long Term Solvency ratios
45. The section of the expense budget that forecasts salary and benefits.
Fixed labor budget
Capital appreciation
FTE
Allowance for uncollectibles
46. The cash flows derived from an organization's operating activities.
Operating cash flows
Float
Billing float
Debt to equity
47. The increase in the value of an investment from the time it is purchased until the time it is sold.
Other expenses
IRR
Capital appreciation
Creditor
48. Requiring the patient to pay part of his/her health care bill. These payments are used to prevent over-utilization of services.
Long-term debt to net assets ratio
Co-payments
Profitability ratios
SWOT analysis
49. 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
Current assets
Properties and equipment
Responsibility center
Contribution margin
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.
Controlling activities
Capital budget
Acid test ratio
Non-operating revenues