NAB RCAL (NURSING HOME ADMINISTRATOR / RESIDENTIAL
CARE ADMINISTRATOR LICENSE) EXAM PREP GUIDE: 350
VERIFIED QUESTIONS & ANSWERS COVERING FINANCIAL
MANAGEMENT, REGULATORY COMPLIANCE, CLINICAL CARE,
OSHA STANDARDS, FIRE SAFETY, HIPAA, MEDICARE/MEDICAID,
AND OPERATIONAL LEADERSHIP FOR THE 2026 ACTUAL EXAM
1. What is the Breakeven Point? - total cost = total revenue
2. What is the formula for the Working Capital Ratio? - current assets /
current liabilities
3. What is the formula for the Acid-Test (Quick) Ratio? - (cash + AR +
short-term investments) / current liabilities
4. What is the formula for the Debt to Assets Ratio? - total
liabilities/total assets
5. How is FTE (Full Time Equivalent) calculated? - total number of hours
per employee in a week / 40 (i.e. 12+14+40+30 div. by 40)
6. What is the formula for Profit Margin? - NOI/Tot. Revenue. Defined
as "income to sales." Includes gross and net types.
,7. What is Net Operating Income (NOI)? - Total (gross) Revenue -
operating expenses
8. What is the formula for Occupancy Rate? - (# of resident
days/facility beds) x 365
9. What does HCS stand for in OSHA regulations? - Hazard
Communication Standard
10. What is the Balance Sheet formula? - Assets = Liabilities +
Shareholders Equity
11. What does EBITDA stand for? - Earnings before interest, taxes,
depreciation, and amortization
12. What is Amortization? - the reduction of a loan balance through
payments made over a period of time
13. What is Revenue Cycle Management in a long-term care setting? -
resident needs->service planning->staffing->billing/collections
14. What are the FICA SS Tax and Medicare Tax rates? - 6.2% and
1.45%
15. What are the 4 elements of a valid contract? - agreement,
consideration, contractual capacity, legality (in writing) "ACCL"
,16. What does liability insurance usually cover? - Bodily injury and
property damage
17. What is Lock out Tag out used for? - For all electrical equipment
18. What are safe electrical practices guided by? - National Electrical
Code or NEC
19. What is involved in following the NFPA Life Safety Code? - fire plan,
regular fire drills, detectors, training on procedure, non combustible
furnishing/draperies
20. What type of fire is Extinguisher Class A used for? - ordinary
combustibles such as wood/paper
21. What type of fire is Extinguisher Class B used for? - For flammable
liquids and gas fires (grease, paint)
22. What type of fire is Extinguisher Class C used for? - Live electrical
equipment (paneling)
23. What type of fire is Extinguisher Class D used for? - Combustible
metals (aluminum)
24. What type of fire is Extinguisher Class K used for? - Commercial
cooking equipment (cooking oil, animal fats)
, 25. What is the formula for Gross Profit Margin? - (Gross Profit / Total
Revenue) x 100
26. What is the formula for Net Profit Margin? - (Net Profit / Total
Revenue) x 100
27. What is the purpose of the Hazard Communication Standard
(HCS)? - To require employers to inform workers of potentially
hazardous chemicals
28. What are current assets? - Assets that are expected to be converted
to cash within one year
29. What are current liabilities? - Debts that are due to be paid within
one year
30. What is shareholder's equity? - The owner's claim after subtracting
total liabilities from total assets
31. What does a high working capital ratio indicate? - That the facility
has sufficient short-term assets to cover short-term debts
32. What does a low acid-test ratio indicate? - Potential liquidity
problems as it excludes inventory from current assets
33. What is considered a good current ratio for a healthcare facility? -
Generally 2:1 or higher
CARE ADMINISTRATOR LICENSE) EXAM PREP GUIDE: 350
VERIFIED QUESTIONS & ANSWERS COVERING FINANCIAL
MANAGEMENT, REGULATORY COMPLIANCE, CLINICAL CARE,
OSHA STANDARDS, FIRE SAFETY, HIPAA, MEDICARE/MEDICAID,
AND OPERATIONAL LEADERSHIP FOR THE 2026 ACTUAL EXAM
1. What is the Breakeven Point? - total cost = total revenue
2. What is the formula for the Working Capital Ratio? - current assets /
current liabilities
3. What is the formula for the Acid-Test (Quick) Ratio? - (cash + AR +
short-term investments) / current liabilities
4. What is the formula for the Debt to Assets Ratio? - total
liabilities/total assets
5. How is FTE (Full Time Equivalent) calculated? - total number of hours
per employee in a week / 40 (i.e. 12+14+40+30 div. by 40)
6. What is the formula for Profit Margin? - NOI/Tot. Revenue. Defined
as "income to sales." Includes gross and net types.
,7. What is Net Operating Income (NOI)? - Total (gross) Revenue -
operating expenses
8. What is the formula for Occupancy Rate? - (# of resident
days/facility beds) x 365
9. What does HCS stand for in OSHA regulations? - Hazard
Communication Standard
10. What is the Balance Sheet formula? - Assets = Liabilities +
Shareholders Equity
11. What does EBITDA stand for? - Earnings before interest, taxes,
depreciation, and amortization
12. What is Amortization? - the reduction of a loan balance through
payments made over a period of time
13. What is Revenue Cycle Management in a long-term care setting? -
resident needs->service planning->staffing->billing/collections
14. What are the FICA SS Tax and Medicare Tax rates? - 6.2% and
1.45%
15. What are the 4 elements of a valid contract? - agreement,
consideration, contractual capacity, legality (in writing) "ACCL"
,16. What does liability insurance usually cover? - Bodily injury and
property damage
17. What is Lock out Tag out used for? - For all electrical equipment
18. What are safe electrical practices guided by? - National Electrical
Code or NEC
19. What is involved in following the NFPA Life Safety Code? - fire plan,
regular fire drills, detectors, training on procedure, non combustible
furnishing/draperies
20. What type of fire is Extinguisher Class A used for? - ordinary
combustibles such as wood/paper
21. What type of fire is Extinguisher Class B used for? - For flammable
liquids and gas fires (grease, paint)
22. What type of fire is Extinguisher Class C used for? - Live electrical
equipment (paneling)
23. What type of fire is Extinguisher Class D used for? - Combustible
metals (aluminum)
24. What type of fire is Extinguisher Class K used for? - Commercial
cooking equipment (cooking oil, animal fats)
, 25. What is the formula for Gross Profit Margin? - (Gross Profit / Total
Revenue) x 100
26. What is the formula for Net Profit Margin? - (Net Profit / Total
Revenue) x 100
27. What is the purpose of the Hazard Communication Standard
(HCS)? - To require employers to inform workers of potentially
hazardous chemicals
28. What are current assets? - Assets that are expected to be converted
to cash within one year
29. What are current liabilities? - Debts that are due to be paid within
one year
30. What is shareholder's equity? - The owner's claim after subtracting
total liabilities from total assets
31. What does a high working capital ratio indicate? - That the facility
has sufficient short-term assets to cover short-term debts
32. What does a low acid-test ratio indicate? - Potential liquidity
problems as it excludes inventory from current assets
33. What is considered a good current ratio for a healthcare facility? -
Generally 2:1 or higher
