Lab Management: Financial Management Questions And Answers

LAB MANAGEMENT: FINANCIAL
MANAGEMENT QUESTIONS AND
ANSWERS
Financial Accounting - ANSWERS-primarily dedicated to recording the "bottom-
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line financial
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position" of the organization; it is often referred to as the
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scorekeeping function. ea




Financial Accounting - ANSWERS-Its focus is on the cash flow and
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financial position of the firm.
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Cost (Managerial) Accounting - ANSWERS-
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The primary objective of cost accounting is to provide the
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manager with information to operate the business.
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budget. - ANSWERS-The most prominent
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document generated by cost accounting is the?
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the statement
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of financial position, also referred to as the balance sheet; the
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statement of income and retained earnings; and the statement of
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flow of funds - ANSWERS-There are three main financial accounting statements:
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statement of financial position or balance sheet - ANSWERS-is the
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best-known document issued by a company. ea ea ea ea ea




The statement of income and retained earnings and the
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statement of flow of funds - ANSWERS-funds are less familiar because they are
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of interest mainly to investors. These two statements are
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concerned with where the company gets its cash and how it
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makes a profit. ea ea




statement of flow of funds - ANSWERS-is a statement that reflects
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the relative position of funds of the company over a two-
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period horizon and enables analysis of sources and uses of
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funds for a particular period of time.
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Assets - ANSWERS-are the resources that the firm uses to conduct its business.
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Assets - ANSWERS-They are
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consumed or in accounting terminology, they expire in the day-to-day
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operation of the enterprise. ea ea ea




TRUE - ANSWERS- ea ea


T/F enterprise. Assets may be in the form of money as cash in
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, the bank or accounts receivable (money owed the business for services
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rendered) or in the form of capital such as buildings or equipment.
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Equities - ANSWERS-Consists of two parts: liabilities and remaining value.
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Liabilities - ANSWERS-are the same for all enterprises and consist of bills
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owed or other obligations.
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remaining value - ANSWERS-company can be described as either
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stockholder equity or retained earnings, depending on the type
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of corporate structure.
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For-profit - ANSWERS-Assets= Equities (Liabilities + Stockholder Equity)
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Not-for-profit - ANSWERS-Assets= Equities (Liabilities + Retained Earnings)
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Recording of Financial Activity - ANSWERS- ea ea ea ea ea


This is the method used to record and report income
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and costs. ea




Cash Accounting Basis - ANSWERS-
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In this plan, bills are paid as they are presented and revenue is counted
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when it is actually received, with no effort to assign costs and revenues
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to the effort and time frame in which they were generated.
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Accrual Accounting Basis - ANSWERS-
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An accounting method that attempts to measure net income for a
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particular period by matching expenses against revenues.
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ACCOUNTING FOR LABORATORY REVENUE - ANSWERS- ea ea ea ea ea


This section discusses profit and cost centers and
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recent changes in reimbursement rules that have affected the laboratory.
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Profit center - ANSWERS-is a department that generates billable
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services.

Cost center - ANSWERS-an area that provide services that benefit
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the entire institution but cannot be directly assigned an
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individual chargeable item. ea ea




Tax Equity and Fiscal Responsibility Act (TEFRA) - ANSWERS-
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a federal program that
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sets caps on the amount of revenue paid for health care expenditures.
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Diagnosis Related Groups (DRGs) - ANSWERS-ea ea ea ea ea


a federal reimbursement system in
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which hospitals are paid based on the nature of the case, or illness, and not
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on the number of individual services provided to the patient.
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