Chapter 1 Healthcare Finance Basics
Healthcare finance is the practice of finance, including? - correct answer ✔✔both accounting and
financial management, within health services (provider) organizations.
Accounting concerns the measurement in? - correct answer ✔✔financial (dollar) terms, of events that
reflect the resources, operations, and financing of an organization.
Financial management provides? - correct answer ✔✔the theory, concepts, and tools necessary to help
managers make better financial decisions.
A business has the following characteristics: - correct answer ✔✔obtains financing from the marketplace
uses the funds to buy assets operates the assets to provide goods or services sells the goods or services
to create revenue.
What is the difference between a business and a pure charity? - correct answer ✔✔a business functions
by selling goods and services (a hospital or medical practice), but a pure charity does not sell goods or
services.
The primary role of finance within any organization is? - correct answer ✔✔plan for, acquire, and utilize
resources to maximize the efficiency(and hence value) of the enterprise.
Finance activities include: - correct answer ✔✔- Planning and budgeting
- Financial reporting
- Capital investment decisions
- Financing decisions
- Working capital management
- Contract management
- Financial risk management
, Finance activities can be summarized by the four Cs: - correct answer ✔✔- Cost minimization
- Cash sufficiency
- Capital access
- Control of financial resources
Comptroller does what? - correct answer ✔✔budgets and reports activities and payables and
receivables management.
Treasurer does what? - correct answer ✔✔- Acquisitions and employment of capital
- Debt management
- Financial risk management
There are four major categories of business organization, and they are? - correct answer
✔✔proprietorship (sole proprietorship), partnership, corporation, and hybrid forms.
How much does the organizational form influence the practice of healthcare finance? - correct answer
✔✔
What are some of the advantages of proprietorships & partnerships? - correct answer ✔✔ease of
formation, subject to few regulations, no corporate income taxes.
What are some of the disadvantages of proprietorships & partnerships? - correct answer ✔✔limited life,
difficult to transfer ownership, unlimited liability, and difficult to raise capital.
What are some advantages of corporations? - correct answer ✔✔unlimited life, easy transfer of
ownership, limited liability, and ease of raising capital.
What are disadvantages of corporations? - correct answer ✔✔cost of formation and reporting and
double (or triple) taxation for investor-owned corporations.
Hybrid Forms of Organization's consist of? - correct answer ✔✔- Limited liability partnership (LLP)
Healthcare finance is the practice of finance, including? - correct answer ✔✔both accounting and
financial management, within health services (provider) organizations.
Accounting concerns the measurement in? - correct answer ✔✔financial (dollar) terms, of events that
reflect the resources, operations, and financing of an organization.
Financial management provides? - correct answer ✔✔the theory, concepts, and tools necessary to help
managers make better financial decisions.
A business has the following characteristics: - correct answer ✔✔obtains financing from the marketplace
uses the funds to buy assets operates the assets to provide goods or services sells the goods or services
to create revenue.
What is the difference between a business and a pure charity? - correct answer ✔✔a business functions
by selling goods and services (a hospital or medical practice), but a pure charity does not sell goods or
services.
The primary role of finance within any organization is? - correct answer ✔✔plan for, acquire, and utilize
resources to maximize the efficiency(and hence value) of the enterprise.
Finance activities include: - correct answer ✔✔- Planning and budgeting
- Financial reporting
- Capital investment decisions
- Financing decisions
- Working capital management
- Contract management
- Financial risk management
, Finance activities can be summarized by the four Cs: - correct answer ✔✔- Cost minimization
- Cash sufficiency
- Capital access
- Control of financial resources
Comptroller does what? - correct answer ✔✔budgets and reports activities and payables and
receivables management.
Treasurer does what? - correct answer ✔✔- Acquisitions and employment of capital
- Debt management
- Financial risk management
There are four major categories of business organization, and they are? - correct answer
✔✔proprietorship (sole proprietorship), partnership, corporation, and hybrid forms.
How much does the organizational form influence the practice of healthcare finance? - correct answer
✔✔
What are some of the advantages of proprietorships & partnerships? - correct answer ✔✔ease of
formation, subject to few regulations, no corporate income taxes.
What are some of the disadvantages of proprietorships & partnerships? - correct answer ✔✔limited life,
difficult to transfer ownership, unlimited liability, and difficult to raise capital.
What are some advantages of corporations? - correct answer ✔✔unlimited life, easy transfer of
ownership, limited liability, and ease of raising capital.
What are disadvantages of corporations? - correct answer ✔✔cost of formation and reporting and
double (or triple) taxation for investor-owned corporations.
Hybrid Forms of Organization's consist of? - correct answer ✔✔- Limited liability partnership (LLP)
