HCM 410 Final Exam Questions and Answers Fully Solved Latest Update

HCM 410 Final Exam Questions and Answers Fully Solved Latest Update Operating Budget - Answers aka annual budget, combines the annual revenue budget and the annual expenditure budget Capital Budget - Answers accounts for the major capital expenditures of the organization and is normally prepared to cover number of budget years Statistical Budget - Answers projects patient care revenues based on units of service to be provided and established reimbursement rates Cash Budget - Answers projects revenues, expenditures, and cash flow on a monthly basis Budget Philosophies - Answers Top-Down Budgeting, Bottom-up Budgeting, Incremental budgeting, Zero-base budgeting Five Steps to Developing an Effective Budget - Answers 1. Prepare a chart of accounts 2. Track historical revenues and costs 3. Benchmark costs 4. Build the annual budget 5. Review the monthly budget Breakeven Analysis (solve for volume or quantity) - Answers the budget mechanism that allows dot the determination of the number of units of service that need to be provided to cover the organization's costs price x volume = fixed costs + (variable costs per unit x Volume) Revenue Budget - Answers starts with the projected revenues form patient care, based on the statistical budget, and adds non patient revenues to project total revenues for the budget year Present Value - Answers PV = FV / (1 + r) ^n Future Value - Answers FV = PV(1 + r) ^n Short Term Low Risk Investments - Answers CDs, US Treasury Bills, Treasury Notes, Treasury Bonds, Federal Agency Securities Three Major Principles of Investing Funds - Answers 1. The time value of money is based on the concept of interest 2. Prudent investing requires understanding of market and securities 3. Investors are rewarded for the risks they take Credit Risks - Answers the danger that the value of a security will fall with the declines in the financial strength of the company issuing the security Commercial Banks - Answers serve the borrowing needs of most medical facilities single payment loans, line of credit, terms loan Bonds - Answers securities where the issuer borrows money from an investor and promises to repay the investor a fixed principal and interest at a stated rate on a specific date