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






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






3. An entity that sells bonds in order to raise money.






4. 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.






5. [(actual cost per unit -budgeted cost per unit) x actual volume).- The difference between the variable expenses that would have been expected at the actual volume and those actually incurred.






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






7. A certificate attached to a bond representing the amount of interest to be paid to the holder.






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






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






10. [Total Revenues/ Total Assets]






11. [(excess of revenues over expenses + interest expense + depreciation expense)/(interest expense + principal payments))- A ratio that measures an organization's ability to pay back a loan. In for-profit organizations - it is calculated as: (net income






12. The bottom area of the financial statements that contains key information not available in the body of the statements - such as how charity is determined - the composition of investments - which assets are restricted - and the depreciation method.






13. How an organization chooses to finance its working capital needs.






14. What a series of equal payments in the future is worth today taking into account the time value of money.






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






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






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






18. Non-operating income.






19. Tools used to increase the amount of cash available to the organization. The objective of billing - credit - and collection policies is to accelerate cash receipts; the objective of cash disbursement policies is to slow down cash outflows.






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






21. The sources of funds to finance the non-current assets of the organization. Also the debt and equity of the organization.






22. The total amount of multiyear debt due in future years.






23. A donation that has conditions which must be satisfied. See also Temporarily restricted net assets.






24. 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.






25. Each service center






26. [Total Revenues/(Net Fixed Assets)]. This ratio measures the number of dollars generated for each dollar invested in an organization's fixed assets (i.e. plant and equipment).






27. That process of budgeting where the environmental assessment and planning of future activities are largely decided upon by a few individuals - and the budget is essentially dictated to the rest of the organization. Often called authoritarian approach






28. Current assets. Net working capital equals current assets –current liabilities.






29. {current liabilities/[(total expenses






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






31. The current traded rate for similar risk securities.






32. A borrower's assets on which a lender has legal claim if a borrower defaults on a loan.






33. Directly related to the purposes of the organization and the delivery of services






34. Amounts the organization is obligated to pay others - including suppliers and creditors.






35. Financing that will be paid back in less than one year.






36. Portion of the profits the organization keeps in-house to use in support of its mission.






37. 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.






38. The elapsed time between financial statements. Common accounting periods






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






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






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






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






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






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






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






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






47. 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.






48. 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






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






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