Practice quiz (5)

What is your present understanding of the short-term versus long-term financial needs of an organization? What might be some short-term financial needs of an organization? What might be some long-term financial needs of an organization? Why might these different types of needs be important to an organization’s success and overall financial health?

1. Cost shifting occurs when a provider responds to low reimbursement rates by public payers (e.g., Medicare or Medicaid) or uncompensated care provided to the uninsured by charging private payers—insurers, managed care companies, or private individuals—more. Essentially, hospitals and physicians try to compensate for providing care below costs to some patients by raising their charges to others. To be able to do so, they would have had to not be fully exploiting their market power in the first place. What is a classic example of this in the healthcare marketplace and how would you go about developing a remedy to reduce the unfair burden cost shifting places on certain payers?

Create a cross volume profit chart. Select an item or product used in an healthcare organization and describe how you would calculate the break - even point. Describe why this break - even information is useful.

What is the key issue currently facing healthcare managers? Do you think this is something that financial managers face in industries other than healthcare?

Listed below are several costs incurred in the loan department of Suwanee Bank and Trust Company. For each cost, indicate which of the following classifications best describe the cost. More than one classification may apply to the same cost item.Cost Classificationsa. Controllable by the loan department managerb. Uncontrollable by the loan department managerc. Direct cost of the loan departmentd. Indirect cost of the loan departmente. Differential costf. Marginal costg. Opportunity costh. Sunk costi. Out-of-pocket costCost Items1. Salary of the loan department manager.2. Cost of office supplies used in the loan department.3. Cost of the department’s desktop computers purchased by the loan department manager last year.4. The portion of general advertising cost of the bank that has been allocated to the loan department.5. Revenue that the loan department would have generated for the bank if a branch loan office had been located downtown instead of in the next county.6. Difference in the…

Instructions:  Designate the best answer for each of the following questions. 1.Which of the following is a responsibility center that incurs expenses, generates revenues, and is responsible for generating a return on assets? a.              Cost center b.              Revenue center c.              Profit center d.              Investment center   2.Which one of the following is the most useful measure for evaluating a manager's performance in controlling revenues and costs in a profit center? a.              Contribution margin b.              Contribution net income c.              Contribution gross profit d.              Controllable margin    3.Hanover Corporation desires to earn target net income of $42,000. The selling price per unit is $18, unit variable cost is $5.60, and total fixed costs are $123,912. How many units must the company sell to earn its target net income? a.              13,380 b.              9,993 c.              3,387 d.              9,217   4.Remark…

Which of the following is a reason to allocate support department costs? O To measure income more accurately for external purposes O To encourage operating departments to use support departments in an efficient way To encourage support departments to use operating departments in an efficient way O To more accurately reflect the true cost of support departments

In your own understanding, please answer the following: 1. What are the importance of knowing, analyzing and assessing the financial statement in the decision making of internal and external users in the organization? 2. Explain briefly how do you understand the concept of Cost of Good Sold.

____              1.Which of the following is a responsibility center that incurs expenses, generates revenues, and is responsible for generating a return on assets? a.              Cost center b.              Revenue center c.              Profit center d.              Investment center   ____              2.Which one of the following is the most useful measure for evaluating a manager's performance in controlling revenues and costs in a profit center? a.              Contribution margin b.              Contribution net income c.              Contribution gross profit d.              Controllable margin   ____              3.Hanover Corporation desires to earn target net income of $42,000. The selling price per unit is $18, unit variable cost is $5.60, and total fixed costs are $123,912. How many units must the company sell to earn its target net income? a.              13,380 b.              9,993 c.              3,387 d.              9,217   ____              4.Remark…

Managers in which of the following responsibility centers are held responsible forprofits? (You may select more than one answer.)a. Revenue centersb. Cost centersc. Profit centersd. Investment centers

1 Responsibility centers typically involve cost, profit, and investment centers. What is the basic measure used to evaluate each of these responsibility center?

A1

Determining the basis used to allocate support department costs follows which guideline? O Profit maximization O Revenue generation O Goal comparison O Cause and effect

In which of the following responsibility centers does the manager have responsibility for and authority over the unit's costs, but not its revenues or investment decisions? Group of answer choices a- Cost Center b- Profit Center c- Investment Center d- Liability Center

Which of the following is NOT a factor that managers should consider in deciding how to allocate resources across customers?       Select one: a. customer growth potential b. customer retention likelihood c. economic forecasts d. short-run and long-run customer profitability

Which of the following is NOT a period cost? Select one: O a. manufacturing costs. Ob general and administrative costs. Oc marketing costs. Od. research and development costs. Which of the following is NOT one of the questions management accountants might attempt to help answer in the formulation of strategy? Select one: a. What substitute products exist in the marketplace? Ob. Who are our most important customers? Does the strategy comply with GAAP (Generally Accepted Accounting Principles)? Od. Will adequate cash be available to implement the strategy?

In which of the following centers are managers responsible for controlling costs and generating revenue? Group of answer choices Revenue center Cost center Profit center Investment center

Which one of the following is NOT a budgetary benefit? It establishes the organization's goal. It establishes communication between different levels of management. It reveals the organization's effectiveness. It aids in the measurement of production efficiency.

Why are elasticities useful to managers? What are the most prevalence and useful elasticities? Why are price elasticities of demand called "elastic" or "inelastic" when others are not? Why is the demand for an individual firm's healthcare products usually elastic?

Which of the following is a measure of a cost center manager's performance? Oa. return on investment and residual income measures Ob. balance sheet Oc. budget performance report Od. divisional income statements

The best measure for evaluating the effectiveness of a manger in an investment center would be   A. residual income measures   B. current ratio measures   C. success in meeting budgeted revenues   D. success in controlling costs