DLM(ASCP) FINAL EXAM 2024/2025 QUESTIONS AND
VERIFIED CORRECT ANSWERS/ ALREADY GRADED A++
Project Volumes (forecasting stage) - ANSWER based on expert opinion, stats,
historical data, shifts in patient mix, changes in medical staff composition, changes in
inflation/reimbursement ratws, expansion/cutbacks, population fluctuations based on
economy
Steps to creating a budget - ANSWER 1. project volumes
2. convert volumes to revenue
3. convert volumes into expense requirements
4. Adjust revenue/ expenses as necessary to meet budget margin
gross revenue - ANSWER Rates x Production Unit (Billable test volume)
Expenses - ANSWER salaries/wages, reference service, instrument lease, maintenance
contracts, education/travel
Financial Statements - ANSWER convey the financial status of an organization
4 main types - income statement, balance sheet statement of changes in equity and
statement of cash flows.
income statement - ANSWER summarizes the operations of an organization with a
focus on its revenues, expenses, and profitability. contains operational results over a
period of time.
depreciation - ANSWER noncash charge against earnings on income statement that
reflect the "wear and tear" on a business' fixed assets (property and equipment). loss of
value
salvage value - ANSWER amount received when final disposition occurs at end of the
asset's useful life.
annual depreciation - ANSWER (initial cost - salvage value)/ useful life
Profit - ANSWER net income -expense
cashflow - ANSWER net income + depreciation
Total Profit Margin - ANSWER Net income divided by total revenues. It measures the
amount of total profit per dollar of total revenues.
fixed costs - ANSWER cost not related to the volume of services delivered (ex. facilities
cost, lab admin, instrument leases, maintenance contracts)
,variable cost - ANSWER directly related to the volume of services delivered (ex.
supplies, labor costs)
Profit Analysis - ANSWER technique use to analyze the effects of volume changes on
profit. can also be used to analyze effects of volume changes on costs.
Total Costs - ANSWER fixed costs + variable costs
Variable costs = variable cost rate x volume
contribution margin - ANSWER difference between per unit revenue and per unit
variable cost. gives the amount left to cover the fixed costs. after fixed costs are
covered what's left contributes to the profit.
accounting breakeven - ANSWER Volume needed to produce zero profit. Revenues
cover all accounting costs.
Total Revenue (cost x volume) - Total Variable (variable cost rate x volume) - fixed
costs = $0
economic breakeven - ANSWER occurs when all accounting costs plus a profit target
are covered
total revenue - total variable cost- fixed cost = profit
Surcharge/Cost Plus - ANSWER used for reference/send out testing. Determine cost of
doing a procedure then add markup factor to get appropriate price.
weight value basis - ANSWER each test performed is assigned a weight based on cost
of performing the test in relation to the procedure.
patient day factor - ANSWER the number of patients in a hospital on a given day.
(average patient day/ daily census for the year) x 365
tests per patient days - ANSWER test volume/ patient days
revenue per test - ANSWER gross revenue/test volume
direct costs - ANSWER test-specific costs (Variable)
examples - supplies, instrumentation, reagents, tech time
indirect cost - ANSWER remain constant
examples - lab admin, medical records, house keeping, utilities, etc. (fixed/semi-
variable)
unit costs - ANSWER total direct + indirect expenses
Employment cycle - ANSWER covers all stages in the process of employing staff:
1. recruitment and acquisition costs (pre-employment screen)
,2. training/developmental costs (ongoing)
3. productive/operational periods
4. termination/separation of employee from institution costs
analyze labor costs - ANSWER institutional labor cost evaluation (employment cycle)
technical evaluation of labor cost - assign labor costs to production activities that
generate expenses. helps manager identify where efforts are being expended and
productivity
accounting and budgeting labor analysis - helps monitor staffing levels, productivity and
management performance against budget objectives
preanalytical time - ANSWER specimen collection, prep, instrument
analytical time - ANSWER performing/resulting tests
post analytical time - ANSWER reporting and routine maintenance
total hours - ANSWER productive hours + nonproductive hours
productive hours - ANSWER actual worked hours includes overtime and training
nonproductive hours - ANSWER compensated but not worked. sick leave, vacation,
bereavement, etc.
Full-time equivalent (FTE) - ANSWER An employee who works full-time, 40 hours per
week, 2080 hours per year (total number of hours paid/ 2080)
171 or 177 hours - per month
Productivity Measurement - ANSWER workload unit (WLU)/ labor units
time studies - ANSWER time required for handling, testing, recording and reporting,
daily and periodic activities, maintenance and repair, and direct technical supervision.
paid productivity - ANSWER tests/ number paid hours
number of tests performed per paid hour.
worked productivity - ANSWER tests/ number worked hours
number of tests performed per worked hour
projected salary - ANSWER total paid hours x average hourly rate
average hourly rate - ANSWER salary expense/ paid hours
supplies - ANSWER meet specific time and price criteria. have shelf life of less than a
year.
, economic ordering quantity (EOQ) - ANSWER Optimum amount to order at one time
economic ordering point (EOP) - ANSWER base/safety level for reordering
(annual usage/365 days) x lead time in days
optimal reordering time (ROT) - ANSWER best time to reorder to take advantage of
EOQ and EOP
(EOQ/Annual Usage) x 365 days
Payback Period - ANSWER the amount of time required for an investment to generate
cash flows sufficient to recover its initial cost
payback period formula - ANSWER cost of investment / annual net cash flow
Average rate of return (ARR) - ANSWER calculates the average annual profit of an
investment project, expressed as a percentage of the initial sum of money invested
annual depreciation - ANSWER (cost - salvage value) / useful life
Net Present Value (NPV) - ANSWER current value of an investment taking into account
impact of interest and inflation on earnings and anticipated revenue received of a period
of years.
sum of present values of each net cash flow (each year)
Initial Rate of Return (IRR) - ANSWER the discount rate that makes the NPV of an
investment zero.
top-down budget - ANSWER A process by which executive managers (hospital
administration/pathologists) create the budget, and that budget is then pushed down
through the rest of the organization.
bottom up budget - ANSWER A budgeting process that begins at the lowest levels of
management and filters up through the organization. comes from managers creating
their own budget for their sections
Zero-Based Budget - ANSWER allocates resources as if each budget was brand new
operating budget - ANSWER budget for day-to-day expenses
is based on historic/current performance and projection of future business.
capital budget - ANSWER budget for major capital, or investment, expenditures (new
equipment, replacement equipment and construction)
Return on Investment (ROI) - ANSWER aka bottom line
(gain - cost)/ cost
VERIFIED CORRECT ANSWERS/ ALREADY GRADED A++
Project Volumes (forecasting stage) - ANSWER based on expert opinion, stats,
historical data, shifts in patient mix, changes in medical staff composition, changes in
inflation/reimbursement ratws, expansion/cutbacks, population fluctuations based on
economy
Steps to creating a budget - ANSWER 1. project volumes
2. convert volumes to revenue
3. convert volumes into expense requirements
4. Adjust revenue/ expenses as necessary to meet budget margin
gross revenue - ANSWER Rates x Production Unit (Billable test volume)
Expenses - ANSWER salaries/wages, reference service, instrument lease, maintenance
contracts, education/travel
Financial Statements - ANSWER convey the financial status of an organization
4 main types - income statement, balance sheet statement of changes in equity and
statement of cash flows.
income statement - ANSWER summarizes the operations of an organization with a
focus on its revenues, expenses, and profitability. contains operational results over a
period of time.
depreciation - ANSWER noncash charge against earnings on income statement that
reflect the "wear and tear" on a business' fixed assets (property and equipment). loss of
value
salvage value - ANSWER amount received when final disposition occurs at end of the
asset's useful life.
annual depreciation - ANSWER (initial cost - salvage value)/ useful life
Profit - ANSWER net income -expense
cashflow - ANSWER net income + depreciation
Total Profit Margin - ANSWER Net income divided by total revenues. It measures the
amount of total profit per dollar of total revenues.
fixed costs - ANSWER cost not related to the volume of services delivered (ex. facilities
cost, lab admin, instrument leases, maintenance contracts)
,variable cost - ANSWER directly related to the volume of services delivered (ex.
supplies, labor costs)
Profit Analysis - ANSWER technique use to analyze the effects of volume changes on
profit. can also be used to analyze effects of volume changes on costs.
Total Costs - ANSWER fixed costs + variable costs
Variable costs = variable cost rate x volume
contribution margin - ANSWER difference between per unit revenue and per unit
variable cost. gives the amount left to cover the fixed costs. after fixed costs are
covered what's left contributes to the profit.
accounting breakeven - ANSWER Volume needed to produce zero profit. Revenues
cover all accounting costs.
Total Revenue (cost x volume) - Total Variable (variable cost rate x volume) - fixed
costs = $0
economic breakeven - ANSWER occurs when all accounting costs plus a profit target
are covered
total revenue - total variable cost- fixed cost = profit
Surcharge/Cost Plus - ANSWER used for reference/send out testing. Determine cost of
doing a procedure then add markup factor to get appropriate price.
weight value basis - ANSWER each test performed is assigned a weight based on cost
of performing the test in relation to the procedure.
patient day factor - ANSWER the number of patients in a hospital on a given day.
(average patient day/ daily census for the year) x 365
tests per patient days - ANSWER test volume/ patient days
revenue per test - ANSWER gross revenue/test volume
direct costs - ANSWER test-specific costs (Variable)
examples - supplies, instrumentation, reagents, tech time
indirect cost - ANSWER remain constant
examples - lab admin, medical records, house keeping, utilities, etc. (fixed/semi-
variable)
unit costs - ANSWER total direct + indirect expenses
Employment cycle - ANSWER covers all stages in the process of employing staff:
1. recruitment and acquisition costs (pre-employment screen)
,2. training/developmental costs (ongoing)
3. productive/operational periods
4. termination/separation of employee from institution costs
analyze labor costs - ANSWER institutional labor cost evaluation (employment cycle)
technical evaluation of labor cost - assign labor costs to production activities that
generate expenses. helps manager identify where efforts are being expended and
productivity
accounting and budgeting labor analysis - helps monitor staffing levels, productivity and
management performance against budget objectives
preanalytical time - ANSWER specimen collection, prep, instrument
analytical time - ANSWER performing/resulting tests
post analytical time - ANSWER reporting and routine maintenance
total hours - ANSWER productive hours + nonproductive hours
productive hours - ANSWER actual worked hours includes overtime and training
nonproductive hours - ANSWER compensated but not worked. sick leave, vacation,
bereavement, etc.
Full-time equivalent (FTE) - ANSWER An employee who works full-time, 40 hours per
week, 2080 hours per year (total number of hours paid/ 2080)
171 or 177 hours - per month
Productivity Measurement - ANSWER workload unit (WLU)/ labor units
time studies - ANSWER time required for handling, testing, recording and reporting,
daily and periodic activities, maintenance and repair, and direct technical supervision.
paid productivity - ANSWER tests/ number paid hours
number of tests performed per paid hour.
worked productivity - ANSWER tests/ number worked hours
number of tests performed per worked hour
projected salary - ANSWER total paid hours x average hourly rate
average hourly rate - ANSWER salary expense/ paid hours
supplies - ANSWER meet specific time and price criteria. have shelf life of less than a
year.
, economic ordering quantity (EOQ) - ANSWER Optimum amount to order at one time
economic ordering point (EOP) - ANSWER base/safety level for reordering
(annual usage/365 days) x lead time in days
optimal reordering time (ROT) - ANSWER best time to reorder to take advantage of
EOQ and EOP
(EOQ/Annual Usage) x 365 days
Payback Period - ANSWER the amount of time required for an investment to generate
cash flows sufficient to recover its initial cost
payback period formula - ANSWER cost of investment / annual net cash flow
Average rate of return (ARR) - ANSWER calculates the average annual profit of an
investment project, expressed as a percentage of the initial sum of money invested
annual depreciation - ANSWER (cost - salvage value) / useful life
Net Present Value (NPV) - ANSWER current value of an investment taking into account
impact of interest and inflation on earnings and anticipated revenue received of a period
of years.
sum of present values of each net cash flow (each year)
Initial Rate of Return (IRR) - ANSWER the discount rate that makes the NPV of an
investment zero.
top-down budget - ANSWER A process by which executive managers (hospital
administration/pathologists) create the budget, and that budget is then pushed down
through the rest of the organization.
bottom up budget - ANSWER A budgeting process that begins at the lowest levels of
management and filters up through the organization. comes from managers creating
their own budget for their sections
Zero-Based Budget - ANSWER allocates resources as if each budget was brand new
operating budget - ANSWER budget for day-to-day expenses
is based on historic/current performance and projection of future business.
capital budget - ANSWER budget for major capital, or investment, expenditures (new
equipment, replacement equipment and construction)
Return on Investment (ROI) - ANSWER aka bottom line
(gain - cost)/ cost
