(for nimmo)

BHA 4053, Financial Management in Health Care Administration (Part one)

Question 1

_________ generally account(s) for most of the cost of providing a service.

		Staffing costs
		Fixed costs
		Net revenue
		Variable expenses

Question 2

A _________ is usually performed when the organization is planning to develop a new service or acquire any type of equipment, the capital cost of which exceeds some internally generated amount of money.

		projection
		pro-forma
		budget
		strategic financial plan

Question 3

The size of the _________ increase is a function of change in volume, severity, and expense, which are all forecast and budgeted by the medical center.

		price
		volume
		demand
		overall

Question 4

A short-term projection of up to a year into the future is called a _________.

		projection.
		pro-forma.
		budget.
		strategic financial plan.

Question 5

A _________ indicator generally defines the level of financial viability.

		financial
		viability
		stability
		volume

Question 6

_________ can be used to determine the current needs and desires of the community in order to create new services to increase market share.

		Focus groups
		Price reduction
		Advertisements
		Public service announcements

Question 7

In terms of financial management, Medicaid, Medicare, and other managed care organizations are all examples of _________.

		third party payers.
		health care organizations.
		for-profit organizations.
		financial organizations.

Question 8

In most cases, Generally Accepted Accounting Principles (GAAP) and financial procedures require _________ and _________ based on a company and an estimator's previous experience within the industry.

		accountants; auditors
		estimates; approximations
		comptrollers; treasurer
		documentation; calculations

Question 9

Which of the following is NOT one of the six major objectives of health care financial management according to Michael Nowicki?

		To create jobs
		To generate income
		To monitor physicians
		To respond to regulations

Question 10

For _________, an important aspect of proper health care financial management is to understand the information needs of the people who are in the board of directors.

		both taxable and non-taxable entities
		taxable entity
		non-taxable entity
		for-profit hospitals

Question 11

Explain how volume is the most sensitive assumption in any pro-forma. What are the elements it affects directly in an income statement?

Question 12

Discuss how the health care industry’s share of GDP affects the overall economy?

(Part two)

Question 1

A _________ presents summarized revenues and expenses of an organization - resulting in a profit or loss - for a given period in time.

		balance sheet
		statement of operations
		statement of cash flows
		note to the financial statement

Question 2

In the non-profit industry, the statement of cash flow is divided into cash flow from operations, investing activity, and _________.

		capital expenditures.
		net investments.
		long term liabilities.
		financing activity.

Question 3

The primary purpose of the _________ is to roll forward the net assets from the end of the prior period to the current period.

		balance sheet
		statement of operations
		statement of changes in unrestricted net assets
		notes to the financial statement

Question 4

The concept of _________ requires that accounting records be constructed in such a manner as to reflect two aspects of each transaction: the change in assets and the change in the source of financing (liabilities).

		transactions
		matching
		accrual
		double entry

Question 5

(Cash and cash equivalents + Board-designated funds for capital) / (Estimated future peak debt service)

		operating balance
		operating margin
		current ratio (x)
		cushion ratio (x)

Question 6

Which of the following is NOT one of the six most sensitive accounts most likely to receive audit adjustments in the financial statements?

		contractual adjustments
		accounts payable
		accounts receivable
		bad-debt expense

Question 7

A _________ presents a snapshot of the financial condition of the health care organization at a single point in time.

		balance sheet
		statement of operations
		statement of cash flows
		note to the financial statement

Question 8

_________ is the revenue earned on investment of excess funds made by the organization.

		fringe income
		interest income
		excess income

Question 9

_________ describes an organization's ability to use current assets to pay off current liabilities.

		Current ratio
		Cushion ratio
		Cash in hand
		Credibility ratio

Question 10

The concept of _________ requires that all financial transactions are recorded at "cost," that is, the price paid to acquire any item or good.

		transactions
		entity
		matching
		cost valuation

Question 11

Explain how it is possible that there could be a conflict between the organization’s administration and its medical staff.

Question 12

Using the balance sheet and statement of operations in Chapter 2, calculate the three bond repayment ratios, and use it to determine the financial condition of the health care organization.

Question 13

If a hospital is not required to prepare a three year strategic plan, what impact would it have on financial and operating outcomes?