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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. 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






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






3. I) Measuring inputs against outputs. 2) The cost of service per unit rendered.






4. Financial obligations that will be paid off over a time period longer than one year






5. The rise in an economy's general level of prices.






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.






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






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






9. The rate of return required to undertake a project. Also called the hurdle rate or discount rate.






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






11. The revenue and expense budgets of an organization.






12. [Total assets/Net Assets]






13. The amount of supplies used to provide a service or good.






14. Decisions regarding the acquisition of capital assets. The capital investment decision should be separate from the decision on how to finance capital assets.






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).






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.






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.






18. Supplementing traditional sources of revenue with new sources.






19. Each service center






20. Activities that provide guidance and feedback to keep the organization within its budget - such as staff meetings - regular reports - and bonuses.






21. The amount expected to be collected from payors. It is calculated as: gross accounts receivable – discounts and allowances – allowance for un-collectibles.






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






23. Ratios designed to answer the question: How profitable is the organization?






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






25. The degree to which standards are met.






26. Amounts earned by the organization from the provision of service or sale of goods.






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






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)






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.






30. Demonstrates the ability to pay off long term debt






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.






32. Assets that provide service for a period exceeding one year. Sometimes referred to as long-term 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.






34. Assets that have restrictions on their use which will be removed either with the passage of time or the occurrence of some event.






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.






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






37. Organizational units responsible for providing health care related services to clients - patients - or enrollees - and the related costs thereof.






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.






39. Service center costs are allocated to both mission centers and other service centers






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






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.






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






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






44. Current year budget projected for the coming fiscal year assumes no program changes and adjust for price - workload - annualizations






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






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






47. The increase in the value of an investment from the time it is purchased until the time it is sold.






48. Requiring the patient to pay part of his/her health care bill. These payments are used to prevent over-utilization of services.






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






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.