NAB NHA Exam- FINANCE Need to Study Questions
and Answers| 100% Verified Answers
mortgage - ✔✔conditional transfer of title on property by a borrower to a lender to secure
payment of a debt or loan
net worth - ✔✔total assets - total liabilities
note - ✔✔written promise to pay definite sum of money on a certain date usually with
interest
sole proprietorship - ✔✔legally liable for business debts
partnership - ✔✔legally liable for business debts
corporation - ✔✔not generally liable for business debts, except payroll taxes. best for
owner's protection against liabilities of business.|
S corporation - ✔✔no corporate tax, except some long-term capital gains. profits or losses
claimed on individual tax returns
limited liability corporation ( LLC) - ✔✔combines characteristics of CORPORATIONS AND
PARTNERHSIPS. more flexible management. profit and losses can be allocated regardless of
how stockholders are invest in the company.||IRS will attach owners assets when corporation
does not remit payroll taxes.
fiscal year and budgeting - ✔✔corporations choose any 12 months. partnerships generally
use calendar year. sole proprietorships use calendar year.
,budget - ✔✔plan expressed in numerical terms that is a forecast of revenues/expenditures
for fiscal year. also budget other resrouces - allocating staff, space, equipment, supplies
master budget - ✔✔includes cash budget, capital budget, liquidity ratios, pro forma finanical
statement
CAPITAL BUDGET - ✔✔INCLUDES REAL ESTATE, BUILDINGS, QUIPMENT, USALLY LIMITING
FACTOR AS RE-COVERAGE FROM EXPENES TAKES LONG TIME, ||MEDICARE COUNTS $5000 OR
MORE AS CAPITAL IF ITEM HAS USEFUL LIF IN RXCESS OF 1 YEAR (PREVIOUSLY $500 OR MORE)
CASH BUDGET - ✔✔FORECAST OF ALL CASH RECEIPTS AND DISBURSEMENTS. CONSIDERS
SCHEDULE OF CASH INFLOWS AND PAYMENTS OF OBLIGATIONS. SHOWS AVAILABILITY OF
CASH.
value - ✔✔makes possible plans to invest surplus and for periods when expenses exceed
income
OPERATING BUDGET - ✔✔INCLUDES DETAILS OF ATINICPATED REVENUES (INCOME) BY
SERVICE, AND ANTICIPATED EXPENDITURES BY CATEGORY. ||HELPS TO CONINUOUSLY STUDY
AND CONTROL FINANCES|||(ROAD MAP TO FUTURE)
INTEGRATED BUDGET - ✔✔a document that projects all capital and operating costs, as well
as all revenues, and consolidates this information
methods - ✔✔most chain organizations have computerized financial management. local
facility computers linked with MAINFRAME COMPUTER IN CENTRAL OFFICE
advantages of methods: - ✔✔easier to access computer data, makes comparisons, etc.
||most budgets now prepared by central office in chain organizations, may ask for
administrator input. some have administrator develop budget, send to central office, which
negotiates with administrator. family owned facilities still depend on administrator to develop
budget.
, timing of budget - ✔✔begin well before beginning of fiscal year- biggest error is waiting too
late.
basis of budgeting - ✔✔on past years' experience, historical trends, and future expectations
forecasting budgets - ✔✔begin with overall facility utilization forecasts-average daily census,
resident days by payer, anticipated changes in needs, trends in economy, employment rates.
reason for budgets - ✔✔to determine reasonable costs and plan cost control
departments in budgets - ✔✔involve department heads in budgeting for own units.
promotes cooperation.
keep revenue cost in balance - ✔✔no deficit budgeting
zero-based - ✔✔evaluated costs and benefits of all activities in comparison to alternative
expenditures, rank and chose from alternatives in term s of how they fit overall priorities
value of budget - ✔✔a. it expresses in financial terms the goals and programs|b. it provides
criteria for evaluation of performance|c. it serves as a control device
Accounting - ✔✔standards established by accountants and boards - GAAP. Nearly all
facilities now use computerized.
define accounting - ✔✔includes bookkeeping, budgeting, reports, specials studies, auditing,
designing systems
bookkeeping - ✔✔very mechanical, recording of business transactions.
and Answers| 100% Verified Answers
mortgage - ✔✔conditional transfer of title on property by a borrower to a lender to secure
payment of a debt or loan
net worth - ✔✔total assets - total liabilities
note - ✔✔written promise to pay definite sum of money on a certain date usually with
interest
sole proprietorship - ✔✔legally liable for business debts
partnership - ✔✔legally liable for business debts
corporation - ✔✔not generally liable for business debts, except payroll taxes. best for
owner's protection against liabilities of business.|
S corporation - ✔✔no corporate tax, except some long-term capital gains. profits or losses
claimed on individual tax returns
limited liability corporation ( LLC) - ✔✔combines characteristics of CORPORATIONS AND
PARTNERHSIPS. more flexible management. profit and losses can be allocated regardless of
how stockholders are invest in the company.||IRS will attach owners assets when corporation
does not remit payroll taxes.
fiscal year and budgeting - ✔✔corporations choose any 12 months. partnerships generally
use calendar year. sole proprietorships use calendar year.
,budget - ✔✔plan expressed in numerical terms that is a forecast of revenues/expenditures
for fiscal year. also budget other resrouces - allocating staff, space, equipment, supplies
master budget - ✔✔includes cash budget, capital budget, liquidity ratios, pro forma finanical
statement
CAPITAL BUDGET - ✔✔INCLUDES REAL ESTATE, BUILDINGS, QUIPMENT, USALLY LIMITING
FACTOR AS RE-COVERAGE FROM EXPENES TAKES LONG TIME, ||MEDICARE COUNTS $5000 OR
MORE AS CAPITAL IF ITEM HAS USEFUL LIF IN RXCESS OF 1 YEAR (PREVIOUSLY $500 OR MORE)
CASH BUDGET - ✔✔FORECAST OF ALL CASH RECEIPTS AND DISBURSEMENTS. CONSIDERS
SCHEDULE OF CASH INFLOWS AND PAYMENTS OF OBLIGATIONS. SHOWS AVAILABILITY OF
CASH.
value - ✔✔makes possible plans to invest surplus and for periods when expenses exceed
income
OPERATING BUDGET - ✔✔INCLUDES DETAILS OF ATINICPATED REVENUES (INCOME) BY
SERVICE, AND ANTICIPATED EXPENDITURES BY CATEGORY. ||HELPS TO CONINUOUSLY STUDY
AND CONTROL FINANCES|||(ROAD MAP TO FUTURE)
INTEGRATED BUDGET - ✔✔a document that projects all capital and operating costs, as well
as all revenues, and consolidates this information
methods - ✔✔most chain organizations have computerized financial management. local
facility computers linked with MAINFRAME COMPUTER IN CENTRAL OFFICE
advantages of methods: - ✔✔easier to access computer data, makes comparisons, etc.
||most budgets now prepared by central office in chain organizations, may ask for
administrator input. some have administrator develop budget, send to central office, which
negotiates with administrator. family owned facilities still depend on administrator to develop
budget.
, timing of budget - ✔✔begin well before beginning of fiscal year- biggest error is waiting too
late.
basis of budgeting - ✔✔on past years' experience, historical trends, and future expectations
forecasting budgets - ✔✔begin with overall facility utilization forecasts-average daily census,
resident days by payer, anticipated changes in needs, trends in economy, employment rates.
reason for budgets - ✔✔to determine reasonable costs and plan cost control
departments in budgets - ✔✔involve department heads in budgeting for own units.
promotes cooperation.
keep revenue cost in balance - ✔✔no deficit budgeting
zero-based - ✔✔evaluated costs and benefits of all activities in comparison to alternative
expenditures, rank and chose from alternatives in term s of how they fit overall priorities
value of budget - ✔✔a. it expresses in financial terms the goals and programs|b. it provides
criteria for evaluation of performance|c. it serves as a control device
Accounting - ✔✔standards established by accountants and boards - GAAP. Nearly all
facilities now use computerized.
define accounting - ✔✔includes bookkeeping, budgeting, reports, specials studies, auditing,
designing systems
bookkeeping - ✔✔very mechanical, recording of business transactions.
