HPA 211 EXAM 2 QUESTIONS AND ANSWERS

HPA 211 EXAM 2 QUESTIONS AND ANSWERS Hospital inventories.. A. are all supplies in a hospital B. are limited to the administrative use by staff C. include medical consumables and administrative materials like paper D. represent goods used in patient services - ANS-D The perpetual inventory system: A. lasts forever, hence the name B. provides real-time information on inventory balances C. represents endless supplies D. counts inventory once per year - ANS-B This ending inventory valuation method emphasizes earnings: A. FIFO B. LIFO C. Weighted average D. None of these - ANS-A This ending inventory valuation method emphasizes low tax burden: A. FIFO B. LIFO C. Weighted average D. None of these - ANS-B Hospital inventories include: A. cafeteria food B. pharmaceuticals C. medical devices D. all of these - ANS-D The ending inventory valuation method's chief virtue is administrative simplicity? A. FIFO B. LIFO C. Weighted average D. None of these - ANS-C Which one of the following is the chief financial objective for inventory management? A. minimize cash tied up in inventory B. place supplies where and when needed C. maximize earnings D. minimize taxes - ANS-A What are two key inventory management performance indicators? A. Turnaround Inventory and Inventory Days on Hand B. Inventory Cost and Inventory Revenue C. Item Returns and Item Used D. Inventory Turnover Ratio and Days in Inventory - ANS-D High Inventory Turnover Ratios indicate: A. More efficient inventory management B. Less efficient inventory management C. Can't tell because you must know the Average Days in Inventory too D. Suggest paying too much for supplies - ANS-A Low Inventory Turnover Ratios indicate: A. More efficient inventory management B. Less efficient inventory management C. Too much cash is embodied in inventory D. Both b and c - ANS-D Increasing number of Days in Inventory suggests: A. Increasingly inefficient inventory management B. Greater capacity to satisfy average demand for medical supplies C. Relatively higher Inventory Turnover Ratios D. Differences in days per month - ANS-A Decreasing number of Days in Inventory suggests: A. Diminished capacity to supply demand for medical supplies B. Greater efficiency in managing inventory C. Relatively lower Inventory Turnover Ratios D. Both b and c - ANS-B Question 7 Which combination of metrics shows greater inventory management efficiency? A. Low Inventory Turnover Ratio and Low Days in Inventory B. The average of Inventory Turnover Ratio and Days in Inventory C. High Inventory Turnover Ratio and Low Days in Inventory D. High Inventory Turnover Ratio and High Days in Inventory - ANS-C The objective for inventory management is: A. Minimize cash via Low Inventory Turnover B. Minimize cash within the context of patient care and outcomes C. Maximize Days in Inventory D. Minimize the amount of cash embodied in inventory - ANS-B Interpretation of financial ratios like inventory turnover or days in inventory requires: A. Cash Flow analysis B. Tracking trends in these ratios over time to determine if efficiency is improving C. Comparison to external references like peer groups or industry average D. Both b and c - ANS-D Depreciation: A. represents the expired portion of long-term asset costs B. is a method for allocating long-term costs over time? C. is associated with tangible assets D. all of these - ANS-D Depreciation expense is reported on the: A. income statement B. balance sheet C. both income statement and balance sheet D. cash flow statement only - ANS-A Estimation of depreciation requires: A. depreciable costs B. estimated useful life C. salvage value D. all of these - ANS-D Straight-line depreciation yields: A. a constant depreciation expense B. higher depreciation expenses in the initial years C. varying depreciation expenses per year D. none of these - ANS-A Book value is the difference between: A. the original purchase price of an asset and its accumulated depreciation B. the original purchase price of an asset and its market value C. the original purchase price of an asset and its depreciation expense D. none of these - ANS-A Revenue Cycle Management is a set of business activities is: A. aimed at reducing the time it takes to go from service to cash B. a method for allocating long-term revenues over time C. limited to denial management D. all of these - ANS-A Denial management is focused on: A. overcoming patient objections to costs of services B. recouping payment promptly for claim rejection C. denying co-payments at the time of service D. all of these - ANS-B Improvements in revenue cycle management should: A. improve cash flow B. increase operating income C. reduce accounts receivable D. all of these - ANS-D Denial management is focused on: A. overcoming patient objections to costs of services B. recouping payment promptly for claim rejection C. denying co-payments at the time of service D. all of these - ANS-B What are two key inventory management performance indicators? A. Turnaround Inventory and Inventory Days on Hand B. Inventory Cost and Inventory Revenue C. Item Returns and Item Used D. Inventory Turnover Ratio and Days in Inventory - ANS-D Which of the following is correct about hospital inventories? A. are all supplies in a hospital B. are limited to the administrative use by staff C. include medical consumables and administrative materials like paper D. represent goods used in patient services - ANS-D Which ending inventory valuation method's chief virtue is administrative simplicity? A. FIFO B. LIFO C. Weighted average D. None of these - ANS-C The perpetual inventory system: A. lasts forever, hence the name B. provides real-time information on inventory balances C. represents endless supplies D. counts inventory once per year - ANS-B Hospital inventories include: A. cafeteria food B. pharmaceuticals C. medical devices D. all of these - ANS-D Straight-line depreciation yields: A. a constant depreciation expense B. higher depreciation expenses in the initial years C. varying depreciation expenses per year D. none of these - ANS-A Which of the following is true about depreciation? A. represents the expired portion of long-term asset costs B. is a method for allocating long-term costs over time? C. is associated with tangible assets D. all of these - ANS-D Which one of the following is the chief financial objective for inventory management? A. minimize cash tied up in inventory B. place supplies where and when needed C. maximize earnings D. minimize taxes - ANS-A Which ending inventory valuation method is a measure of efficient inventory management? A. FIFO B. LIFO C. Weighted average D. None of these - ANS-D Estimation of depreciation requires: A. depreciable costs B. estimated useful life C. salvage value D. all of these - ANS-D Improvements in revenue cycle management should: A. improve cash flow B. increase operating income C. reduce accounts receivable D. all of these - ANS-D This ending inventory valuation method emphasizes earnings: A. FIFO B. LIFO C. Weighted average D. None of these - ANS-A Which ending inventory valuation method's chief virtue is administrative simplicity? A. FIFO B. LIFO C. Weighted average D. None of these - ANS-C Which of the following is true about depreciation? A. represents the expired portion of long-term asset costs B. is a method for allocating long-term costs over time? C. is associated with tangible assets D. all of these - ANS-D Which of the following is correct about hospital inventories? A. are all supplies in a hospital B. are limited to the administrative use by staff C. include medical consumables and administrative materials like paper D. represent goods used in patient services - ANS-D Which one of the following is the chief financial objective for inventory management? A. minimize cash tied up in inventory