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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. process of measuring the resources (costs) used to produce results.






2. The time between the issuance of the bill and the time funds are available for use by the health care organization. It has two components: mail float and processing float.






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






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






5. 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.






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






7. [Total Liabilities/ Net assets]






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






9. 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.






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






11. Cash flows that occur solely as a result of undertaking a project. Basically the marginal difference between alternatives.






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






13. Operating income not reported elsewhere under revenues - gains - and other support.






14. A security interest in one or more assets granted to lenders in a secured loan.






15. The degree to which standards are met.






16. [long-term debt/net assets]- A measure of the proportion of an organization's assets that are financed by debt as opposed to equity. In for-profit organizations - it is called the long-term debt to equity ratio and is calculated using the formula [lo






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






18. A form of long-term financing whereby the issuer receives cash and in return issues a note called a bond. By issuing the bond - the issuer agrees to make principal and/or interest payments on specific dates to the holders of the bond.






19. Ratios that measure how efficiently an organization is using its assets to produce revenues.






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






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






22. A budget which presents not only line items and programs but also the performance goals that each program can be expected to attain. See also Line item budget and Program budget.






23. Stated interest rate on a bond - as promised by the issuer.






24. {current liabilities/[(total expenses






25. Funds provided by a private entity or individual without the requirement of repayment. Donations can either be restricted or unrestricted.






26. Policies and procedures that address when and how to collect revenues - such as paying at time of service - sending accounts to collection agencies - and writing off accounts as bad debt.






27. A section of the statement of cash flows used to report such activities as borrowing and paying back loans.






28. 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






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






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






31. Revenues generated from an organization's operating activities.






32. 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.






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






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






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






36. The amount of the total revenue variance that occurs because the actual average rate charged varies from that originally budgeted. It can be calculated using the formula: (actual rate -budgeted rate) x actual volume.






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






38. Future value. What an amount invested today (or a series of payments made over time) will be worth at a given time in the future using the compound interest method. This accounts for the time value of money. See also Present value.






39. The balance sheet category that includes actual money on hand as well as money equivalents - such as savings and checking accounts. It excludes cash restricted as to its use for something other than current operations.






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






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






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






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






44. The amount of inventory on hand at the end of an accounting period. See also Beginning inventory.






45. Assets that have a physical presence.






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






47. That point at which total revenues equal total costs. It is described by the equation: (price x volume) = fixed costs + (variable cost per unit x volume).






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






49. The current traded rate for similar risk securities.






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