1) Using what you have learned about finance to date, is the contribution margin the
same as the operating margin?
A. Always
B. In some circumstances
C. Never
D. Not applicable
2) Liabilities are:
A. Economic obligations
B. What the organization owns
C. Debts that are payable
D. What the organization owes
E. A & C
F. B & C
G. A, C & D
H. None of the above
3) In another example within the text, the general services expenses of two years in the
same hospital are compared. After the year 1 versus year 2 difference is computed in
dollars, that difference amount is divided by what figure to obtain a percentage
difference for purposes of comparison?
A. Divided by the year 1 base figure
B. Divided by the year 2 base figure
C. Neither of the above
4) Certain organizations may also group their revenue-producing cost centers as
follows:
A. Nursing services versus other professional services
B. Maintenance versus laundry
C. Support services versus security
5) The measurement method used to calculate filling scheduled positions:
A. Is a staffing measure
B. May be called the full time equivalent or FTE
C. Measures what proportion of one single full-time employee is required to equate the
hours required for a particular position
D. All of the above
E. None of the above
6) The Phillips and Potter physician practice partnership owes $500,000 in debt and
also has $500,000 in partners equity. The partnerships capital structure, or debt-equity
relationship, is therefore:
A. 1-to-1
B. 50-50
C. 100%
D. None of the above
7) Net worth is:
A. What the business is worth
B. What the business is worth, net of liabilities
C. What the business is worth, net of receivables
D. None of the above
8) A narrower interpretation of the term expense:
A. Only considers expenses that are operating expenses
B. Disregards deductions from revenue
C. Groups expenses into categories
D. All of the above
E. None of the above
9) When preparing the staffing forecast for an organizations startup phase, it is
important to be careful about:
A. Forecasting under-capacity (a chronic lack of adequate staff)
B. Forecasting overcapacity (too much staff available for the work required)
C. Either of the above
D. Neither of the above
10) An IT Management Accountability Report is illustrated within the VA Planning
Cycles Process Flow example. How often does the Accountability Report in this
example have to be submitted?
A. At the end of each 5-year planning cycle
B. At the end of each 3-year planning cycle
C. By the annual end of each fiscal year
D. Any of the above
E. None of the above
11) When preparing the financial analysis for a business plan, the required statements
and schedules will depend on the following factors:
A. The size of the particular project
B. The plans presentation procedure that is expected in your own organization
C. The projects complexity
D. A & C
E. A & B
F. All of the above
12) Estimates may be of:
A. amount
B. size
C. value
D. all of the above
E. A and B only
F. B and C only
13) One type of capital expenditure proposal involves a request to fund the expansion
of an existing program. Which of the following selling points allow this type of funding
proposal to be easier to prepare and thus more likely to succeed?
A. Statistics are available from the existing program to use within the proposal –yes
B. Startup costs would be negligible or none –yes
C. The proposal will be compared with other department funding requests –no
D. A & B
E. A & C
F. B & C
G. All of the above
14) Variable costs would typically include payroll taxes, dietarys raw food costs, and
rent expense.
A. Correct
B. Not correct
C. Not applicable
15) Recognized types of benchmarks include:
A. A financial variable not reported in an accounting system
B. A financial variable reported in an accounting system
C. Both of the above
D. Neither of the above
16) Methods of benchmarking include:
A. analyzing processes within your own organization that are worthwhile to replicate
B. examining the process of noncompetitors with a world-class reputation
C. studying the methods and results of your prime competitors
D. all of the above
E. none of the above
17) Payments as an incentive to adopt electronic health records were previously
recommended in what time period?
A. The mid 1960s
B. The early 1980s
C. The early 1990s
D. None of the above
18) Forecasts:
A. Reflect actions that are expected to occur
B. Are based on assumptions that are expected to exist
C. Both of the above
D. Neither of the above
19) The Sum-of-the-Years Digits (SYD) method is:
A. An accelerated depreciation method
B. A straight-line depreciation method
C. Computes depreciation using a fraction
D. Computes depreciation using a constant percentage or factor
E. A & C
F. A & D
G. B & C
H. B & D
20) Within the origins of financial management, who wrote about the universal function
of management in human endeavors?
A. Plato
B. Socrates
C. The Sumerians
D. None of the above
21) When a financial manager studies current reports and compares them with reports
from earlier periods to see if established plans are being followed, these reports are
called:
A. Subsidiary reports
B. The general ledger
C. Feedback
D. A & B
F. B & C
G. All of the above
22) Within a managers departmental operating budget, which of the following will
probably not be included?
A. Interest expense
B. Amortization of loan costs
C. The departments computer service contracts
D. A & B
E. A & C
F. All of the above
23) A group of patients whose resource consumption is, on statistical average,
equivalent:
A. Is termed a patient category
B. Is represented by a DRG, or diagnosis-related group
C. Both of the above
D. Neither of the above
24) The basic types of healthcare organizations may be described as:
A. Profit-oriented
B. Nonprofit oriented
C. Foundations that comply with all legal requirements
D. A & B
E. A & C
F. B & C
G. None of the above
25) The present value factors used in computing the overall present value net cost
examples came from a table of such factors. The table shows years vertically and
various percentages in horizontal columns, and is an Appendix to the chapter about the
time value of money. This chapter actually contains three appendices, each containing a
different type of table. Which one is the appropriate table for determining the present
value factors used in our computations?
A. Present Value Table (Present Value of $1)
B. Present Value of an Annuity of $1
C. Compound Interest Table (The Future Amount of $1)
D. None of the above
26) Creditors are those:
A. To whom debts are due
B. Who hold equity in the organization
C. Neither of the above
27) One method of grouping revenue is by revenue source. Such grouping by revenue
source may typically include the following:
A. Title XVIII and Title XIX revenue
B. Private pay revenue
C. HMO and PPO revenue
D. Commercial insurer and other revenue
E. All of the above