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 He
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alth, and Not-for-
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Profit Organizations 7th Edition by Steven Finkler, Thad Calab
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rese, (Complete 15 Chapters)
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,Chapter 3: Additional Budgeting Concep
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INTRODUCTION
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FINANCIALM rq




ANAGEMENT
Questions for Discussion rq rq




1-
1. Financial management is the subset of management that focuses on generating financial info
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rmationthat can improve decisions. The decisions are oriented toward achieving the various go
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als of the organization while maintaining a satisfactory financial situation. Financial management
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encompassesthe broad areas of accounting and finance. rq rq rq rq rq rq rq




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 organiz
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ation.

1-
3. In public service organizations, decisions are oriented toward achieving the various goals of t
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he 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 the fin
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ancial results of its activities. It has often been referred to as the language of business. The voc
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abulary 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 accounti
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ng. Managerial accounting relates to generating any financial information that managers can us
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e to improve the future results of the organization. This includes techniques designed to genera
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te any financial data that might help managers make more effective decisions. Major aspects of
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managerialaccounting relate to making financial plans for the organization, implementing those p
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lans, and thenworking to ensure that the plans are achieved. Some examples of managerial acc
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ounting include preparing annual operating budgets, generating information for use in making
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major investment decisions, and providing the data needed to decide whether to buy or lease a
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major piece of equipment. Financial accounting provides retrospective information. As events t
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hat have financial implications occur they are recorded by the financial accounting system. From
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time to time (usuallymonthly, quarterly, or annually), the recorded data are summarized and re
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ported to interested users.The users include both internal managers and people outside the org
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anization. Those outsiders include those who have lent or might lend money to the organizatio
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n (creditors), those who might sell things to the organization (called suppliers or vendors), and
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other interested parties. These interested parties may include those with a particular interest in
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public service organizations, such asregulators, legislators, and citizens. Financial reports provide
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, Instructor’s Manual for Financial Management for Public, Health, and Not-for-
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information
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Profit Organizations
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orting the past results of the organization‘s operations (i.e., how well it has done from a financi
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al viewpoint).
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, Chapter 3: Additional Budgeting Concep
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1-
6. Finance focuses on the alternative sources and uses of the organization‘s financial resources.
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Obtaining funds when needed from appropriate sources and the deployment of resources withi
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n theorganization fall under this heading. In addition, finance involves the financial markets (su
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ch as stock and bond markets) that provide a means to generating funds for organizations.
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1-
7. Yes. Achieving the goals of the organization requires financial planning. Financial managemen
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t provides information for managers to use in making their decisions. It helps managers by pro
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viding information on the likely financial impact of each proposed alternative. It also provides in
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formation 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 som
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e hospitals, to earn profits. But what about other public service organizations such as charities?
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Theyshould make a profit as well. Profits provide a safety margin against unexpected costs, pro
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vide resources to replace buildings and equipment, and to expand and improve services.
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1-9. Federal government (see text Figure 1-1)
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 Individual income taxes rq rq


 Social insurance taxes rq rq


 Corporate income tax rq rq




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


 Federal government rq


 Property taxes rq


 Individual income taxes rq rq




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


 Medicare
 Medicaid
 Other government programs rq rq




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


 Private payments for goods and services rq rq rq rq rq


 Government payments for goods and services rq rq rq rq rq


 Donations

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10. Federal government spending exceeded $6 trillion in 2020 and state and local government sp
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endingwas more than $3 trillion in 2018. In contrast, the GDP was $21 trillion in 2020. For mor
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e up to date information, examine the statistical tables of the most recent Economic Report of
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the President, which is available online.
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