Healthcare Financial Management
Exam 1 Question and answers
correctly solved 2025/2026
What are stakeholders? - correct answer ✔those individuals, groups, and organizations who have a
"stake" in the success of the organization including owners, employees, customers, suppliers, the
community at large and so on
What is financial accounting? - correct answer ✔The field of accounting that focuses on the
measurement and communication of the economic events and status of an entire organization
What does financial accounting involve? - correct answer ✔It involves identifying, measuring,
recording, and communicating in dollar terms the economic events and status of an organization
Physical assets - correct answer ✔land, buildings, equipment
Two categories of investors - correct answer ✔1) owners who supply equity capital to investor-owned
businesses and
2) creditors (lenders) who supply debt capital to both investor-owned and not-for-profit businesses
Goals of investors - correct answer ✔Create financial targets based on the numbers reported in
financial statements that managers must attain or suffer some undesirable consequence
Securities and Exchange Commission (SEC) - correct answer ✔The federal government, the
independent regulatory agency that regulates the sale of securities and the operations of securities
exchanges. Also has overall responsibility for the formal and content of financial statements
Financial Accounting Standards Board (FASB) - correct answer ✔a private organization whose mission is
to establish and improve the standards of financial accounting and reporting for private businesses
, Government Accounting Standards Board - correct answer ✔Establishes and improves standards of
financial accounting and reporting for businesses that are partially of totally funded by a government
entity
American Institute of Certified Public Accountants (AICPA) - correct answer ✔the profession association
of public (financial) accountants. Ex: Financial statements in the health services industry are based on
the AICPA Audit and Accounting Guide (Health Care Entities) which was published in September of 2014
FASB Accounting Standards Codification - correct answer ✔To simplify access to accounting standards
by placing them in a single source and creating a system that allows users to more easily research and
reference accounting standards data
Principles and Practices Board - correct answer ✔Develops position statements and analyses on issues
that require further guidance, Ex: its statement regarding the valuation and financial statement
presentation of charity care and bad debt losses, issued in 2006 and revised in 2012.
Generally Accepted Accounting Principles (GAAP) - correct answer ✔A set of objectives, conventions,
and principles that have evolved through the years to guide the preparation and presentation of
financial statements. (only financial accouting, NO tax accounting or managerial accounting)
External audit - correct answer ✔Large organizations that finally link in the financial statement quality
assurance process, which is performed by an independent auditor (one of the major accounting firms)
Auditor's Opinion - correct answer ✔An expression about whether financial statements conform with
generally accepted accounting principles as specified by GAAP
Unqualified opinion - correct answer ✔in the auditor's opinion, the financial statements conform to
GAAP, are presented fairly and consistently, and contain all necessary disclosures, Ex: "clean bill of
health"
Exam 1 Question and answers
correctly solved 2025/2026
What are stakeholders? - correct answer ✔those individuals, groups, and organizations who have a
"stake" in the success of the organization including owners, employees, customers, suppliers, the
community at large and so on
What is financial accounting? - correct answer ✔The field of accounting that focuses on the
measurement and communication of the economic events and status of an entire organization
What does financial accounting involve? - correct answer ✔It involves identifying, measuring,
recording, and communicating in dollar terms the economic events and status of an organization
Physical assets - correct answer ✔land, buildings, equipment
Two categories of investors - correct answer ✔1) owners who supply equity capital to investor-owned
businesses and
2) creditors (lenders) who supply debt capital to both investor-owned and not-for-profit businesses
Goals of investors - correct answer ✔Create financial targets based on the numbers reported in
financial statements that managers must attain or suffer some undesirable consequence
Securities and Exchange Commission (SEC) - correct answer ✔The federal government, the
independent regulatory agency that regulates the sale of securities and the operations of securities
exchanges. Also has overall responsibility for the formal and content of financial statements
Financial Accounting Standards Board (FASB) - correct answer ✔a private organization whose mission is
to establish and improve the standards of financial accounting and reporting for private businesses
, Government Accounting Standards Board - correct answer ✔Establishes and improves standards of
financial accounting and reporting for businesses that are partially of totally funded by a government
entity
American Institute of Certified Public Accountants (AICPA) - correct answer ✔the profession association
of public (financial) accountants. Ex: Financial statements in the health services industry are based on
the AICPA Audit and Accounting Guide (Health Care Entities) which was published in September of 2014
FASB Accounting Standards Codification - correct answer ✔To simplify access to accounting standards
by placing them in a single source and creating a system that allows users to more easily research and
reference accounting standards data
Principles and Practices Board - correct answer ✔Develops position statements and analyses on issues
that require further guidance, Ex: its statement regarding the valuation and financial statement
presentation of charity care and bad debt losses, issued in 2006 and revised in 2012.
Generally Accepted Accounting Principles (GAAP) - correct answer ✔A set of objectives, conventions,
and principles that have evolved through the years to guide the preparation and presentation of
financial statements. (only financial accouting, NO tax accounting or managerial accounting)
External audit - correct answer ✔Large organizations that finally link in the financial statement quality
assurance process, which is performed by an independent auditor (one of the major accounting firms)
Auditor's Opinion - correct answer ✔An expression about whether financial statements conform with
generally accepted accounting principles as specified by GAAP
Unqualified opinion - correct answer ✔in the auditor's opinion, the financial statements conform to
GAAP, are presented fairly and consistently, and contain all necessary disclosures, Ex: "clean bill of
health"
