FACHE WK 3&4 Finance Study Questions 2023 – 2024 Updated Solution

FACHE WK 3&4 Finance Study Questions 2023 – 2024 Updated Solution Depreciation expense that is calculated in accordance with GAAP using the straight-line method is obtained by: a. Dividing the historical cost of the asset by the number of years of its estimated useful life. b. Dividing the historical cost of the asset by the annual cost of maintaining the asset. c. Dividing the present-day value of the asset by the number of years of its estimated useful life. d. Dividing the historical cost of the asset (less its estimated salvage value) by the number of years of its estimated useful life. - CORRECT ANS - D What methods of payment are the most preferable and the least preferable to the provider's point of view? a. Charges minus a discount; cost plus a percentage for growth b. Cost; per diem c. charges; cost d. charges; capitation - CORRECT ANS - D As to the Manage Care Continuum, from the least control to the most control, which of the following orders is correct? a. Managed Indemnity->Service Plans->Closed-Panel HMO's b. Closed-Panel HMO's->Service Plans->Managed indemnity c. Service Plans->Closed-Panel HMO's->Open-Panel HMO's d. Point-of-Service Plans->Closed-Panel HMO's->Preferred Provider Plans - CORRECT ANS - A The prerequisites for building the operating budget include all but one of the following: a. Well-defined chart of accounts b. Sound organizational chart c. Prompt and accurate accounting system d. Defined short payback period e. Comprehensive management information system f. Budget director and budget committee g. Budget manual and calendar - CORRECT ANS - D Of the four design characteristics of budgeting, which characteristic integrates budgets into one document? a. Incremental versus Zero Based Budgeting b. Comprehensive versus Limited in-Scope budgeting c. Fixed versus Flexible Budgeting d. Discrete Versus continuous Budgeting - CORRECT ANS - B