Solution Manual for Financial Management for Public Health, and Not-for-Profit Organizations 7th Edition by Finkler, Calabrese & Smith Verified Chapters 1 - 15, Complete

Instructor’s Manual for Financial Management for Public, Health, and Not-for-
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Profit Organizations1,
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SOLUTIONS MANUAL for Financial Management for Public H
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ealth, and Not-for-
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Profit Organizations 7th Edition by Steven Finkler, Thad Cala
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brese, (Complete 15 Chapters)
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,Chapter 3: Additional Budgeting Conce
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pts

INTRODUCTION
Chapter 1 km
TO
FINANCIALM km




ANAGEMENT
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1-
1. Financial management is the subset of management that focuses on generating financial
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informationthat can improve decisions. The decisions are oriented toward achieving the vari
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ous goals of the organization while maintaining a satisfactory financial situation. Financial ma
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nagement encompassesthe broad areas of accounting and finance.
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1-2. In proprietary, or for-
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profit, organizations, an underlying goal is to maximize the wealth of the owners of the org
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anization.

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3. In public service organizations, decisions are oriented toward achieving the various goals
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mof the organization while maintaining a satisfactory financial situation.
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1-
4. Accounting is a system for keeping track of the financial status of an organization and t
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he financial results of its activities. It has often been referred to as the language of busine
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ss. The vocabulary used by accounting is the language of nonbusiness organizations as well.
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1-
5. Accounting is subdivided into two major areas: managerial accounting and financial acco
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unting. Managerial accounting relates to generating any financial information that managers
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mcan use to improve the future results of the organization. This includes techniques designe
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d to generate any financial data that might help managers make more effective decisions.
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Major aspects of managerialaccounting relate to making financial plans for the organization, i
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mplementing those plans, and thenworking to ensure that the plans are achieved. Some ex
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amples of managerial accounting include preparing annual operating budgets, generating inf
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ormation for use in making major investment decisions, and providing the data needed to
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decide whether to buy or lease a major piece of equipment. Financial accounting provides
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retrospective information. As events that have financial implications occur they are recorded
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mby the financial accounting system. From time to time (usuallymonthly, quarterly, or annuall
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y), the recorded data are summarized and reported to interested users.The users include b
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oth internal managers and people outside the organization. Those outsiders include those w
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ho have lent or might lend money to the organization (creditors), those who might sell thin
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gs to the organization (called suppliers or vendors), and other interested parties. These inte
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rested parties may include those with a particular interest in public service organizations, suc
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, Instructor’s Manual for Financial Management for Public, Health, and Not-for-
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h Profit
kmasregulators, legislators,
Organizations
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l status of the organization at a specific point in time, as well as reporting the past results
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of the organization‘s operations (i.e., how well it has done from a financial viewpoint).
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, Chapter 3: Additional Budgeting Conce
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pts

1-
6. Finance focuses on the alternative sources and uses of the organization‘s financial resour
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ces. Obtaining funds when needed from appropriate sources and the deployment of resourc
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es within theorganization fall under this heading. In addition, finance involves the financial
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markets (such as stock and bond markets) that provide a means to generating funds for or
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ganizations.

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7. Yes. Achieving the goals of the organization requires financial planning. Financial manage
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ment provides information for managers to use in making their decisions. It helps manager
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s by providing information on the likely financial impact of each proposed alternative. It als
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o provides information about financial stability, efficiency, and effectiveness.
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1-
8. Clearly, we might expect some public service organizations that are proprietary, such as
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some hospitals, to earn profits. But what about other public service organizations such as c
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harities? Theyshould make a profit as well. Profits provide a safety margin against unexpect
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ed costs, provide resources to replace buildings and equipment, and to expand and improv
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e services.
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1-9. Federal government (see text Figure 1-1)
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 Individual income taxes km km


 Social insurance taxes km km


 Corporate income tax km km




State and local government (see text Figure 1-4)
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 Sales and gross receipts tax km km km km


 Federal government km


 Property taxes km


 Individual income taxes km km




Health sector (see text Figure 1-6)
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 Private insurance km


 Medicare
 Medicaid
 Other government programs km km




Not-for-profit sector (see text) km km km


 Private payments for goods and services km km km km km


 Government payments for goods and services km km km km km


 Donations

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10. Federal government spending exceeded $6 trillion in 2020 and state and local governmen
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t spendingwas more than $3 trillion in 2018. In contrast, the GDP was $21 trillion in 2020.
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