Which of the following is not a “principle” of financial accounting?

Question 1
1. Which of the following is not a “principle” of financial accounting?

A. Historical cost
B. Revenue recognition
C. Continuity
D. Matching

Question 2
1. The cash budget focuses on which of the following major activities:
A. Purchasing of resources
B. Collection
C. Production/sale of service
D. All of the above

Question 3
1. A statement that reports inflows and outflows of cash during the accounting period in the categories of operations, investing, and financing, is called a(an):

A. Income statement
B. Statement of retained earnings
C. Balance sheet
D. Statement of cash flows

Question 4
1. The following is an example of a _____________ budget: “The budget for the radiology department is different at 90 percent occupancy than at 80 percent occupancy.”

A. rolling
B. forecast
C. flexible
D. fixed

Question 5
1. The controller in a hospital is usually responsible for which of the following activities (choose all that apply):

A. Collection of accounts receivable
B. Developing budgets
C. Filing Medicare cost reports
D. Arranging hospital loans

Question 6
1. Strategic planning should _________ financial planning.

A. follow
B. precede
C. be contemporaneous with
D. None of the above

Question 7
1. What is net working capital?

A. Current assets less long-term liabilities
B. Current assets less current liabilities
C. The amount of permanent financing required to finance working capital or current assets.
D. Both B and C

Question 8
1. The working capital cycle looks at which of the following:

A. Obtaining cash
B Turning cash into resources and paying bills
C. billing and collecting revenues earned
D. All of the above

Question 9
1. 18. You have just advance refunded $50 million of outstanding tax-exempt revenue bonds with $40 million of new debt, which created a gain after considering reimbursement effects of $5.0 million. What could account for this?

A. Higher interest rate on the refunding issue
B. Lower interest rate on the refunding issue
C. Positive arbitrage on the refunding issue
D. None of the above

Question 10
1. A not-for profit nursing home has total expenses of $20 million. Sales tax in the state is 7%. Expenses are broken down into salaries ($12 million), supplies ($6 million), and pharmacy ($2 million). The benefit received by the nursing home from the sales tax exemption assuming that pharmacy items are exempt from state sales tax is?

A. $1.4 million

B. $1.26 million

C. $420,000

D. $480,000

Question 11
1. A department manager most often uses his or her hospitals’ financial information for which of the following uses:

A. Assess the financial condition of the hospital

B. Assess the efficiency of operations

C. Evaluate the hospital’s stewardship

D. Assess the effectiveness of operations
5 points
Question 12
1. The heading of every financial statement should contain the:

A. name, title, and place of business

B. name, title, and specific date of statement

C. name, title, specific date of statement, and unit of measurement

D. title, name, type of ownership, and unit of measurement
5 points
Question 13
1. Which of the following is not one of the four critical questions that must be answered for dashboard reporting?

A. What is the firm’s strategic vision?

B. What is most important to the firm’s success?

C. What are the critical drivers that influence performance attainment?

D. What are the most relevant measures that reflect critical driver relationships?

Question 14
1. Accounts receivable (net) increased by $500,000 during the year. This increase has what effect on cash flow?

A. Reduces it

B. Increases it

C. No effect

D. All of the Above

Question 15
1. What should be a firm’s primary long-term financial objective?

A. profit growth
B. debt growth
C. asset growth
D. equity growth

Question 16
1. The Catholic Healthcare Association recognizes which of the following as legitimate areas of community benefit?

A. Bad Debts
B. Unreimbursed Medicare Costs
C. Both A and B
D. Neither A nor B

Question 17
1. Which of the following is an element of budgeted financial requirements that is not included in budgeted expenses?

A. Interest expense

B. Increases in working capital

C. Labor expense

D. A and B

E. None of the above
Question 18
1. Which of the following tends to insulate management somewhat from the financial results of poor financial planning? (Pick the best answer.)

A. Capitated rates

B. Cost reimbursement

C. Bundled services

D. Charge payment
5 points
Question 19
1. What of the following is not one of the characteristics of long-term debt financing?

A. Cost
B. Control
C. Risk
D. Inventory