ACHE WEEK 3 AND 4 FINANCE TEST
QUESTIONS WITH CORRECT
DETAILED ANSWERS
Accounting methods - Answer-Cash accounting
Accrual accounting
Advantages of cash accounting - Answer-...
Advantages of accrual accounting - Answer-...
4 financial statements - Answer-...
Statements of operation - Answer-...
What is the purpose of the statement of operation - Answer-Present the operating
results over a period of time
Diff between gross and net patient service revenue - Answer-...
Describe how types of revenue are reported (charity, bad debt, and discounts from
charges) - Answer-...
What is financial accounting - Answer-Financial accounting identifies, measures,
records, and
communicates, in dollar terms, the economic events and
status of an organization.
What is managerial accounting - Answer-...
What is the difference between financial and managerial accounting - Answer-...
What is GAAP - Answer-Generally accepted accounting practices
, Second major financial statement - Answer-Balance sheet
Balance sheet - Answer-Current assets
What is the purpose of the balance sheet? - Answer-...
What are the three major sections of the balance
sheet? - Answer-...
What is accumulated depreciation and how does it
relate to the statement of operations?
relate to the statement of operations? - Answer-...
What is accumulated depreciation and how does it
relate to the statement of operations?
relate to the statement of operations? - Answer-...
How does the balance sheet relate to the statement
of operations? - Answer-...
1. Depreciation expense that is calculated in accordance with GAAP using the straight-
line method is obtained by:
a. Dividing the historical cost of the asset by the number of years of its estimated useful
life.
b. Dividing the historical cost of the asset by the annual cost of maintaining the asset.
c. Dividing the present-day value of the asset by the number of years of its estimated
useful life.
d. Dividing the historical cost of the asset (less its estimated salvage value) by the
number of years of its estimated useful life. - Answer-Answer: D. Source: course
Syllabus, Finance Section, financial Accounting Basics, page 79.
2. What methods of payment are the most preferable and the least preferable to the
provider's point of view?
a. Charges minus a discount; cost plus a percentage for growth
b. cost; per diem
c. charges; cost
d. charges; capitation - Answer-Answer: D. Source: course Syllabus, Finance Section,
Methods of Payment
3. As to the Manage Care Continuum, from the least control to the most control, which
of the following orders is correct?
a. Managed Indemnity->Service Plans->Closed-Panel HMO's
b. Closed-Panel HMO's->Service Plans->Managed indemnity
c. Service Plans->Closed-Panel HMO's->Open-Panel HMO's
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