Question 1

Describe just in time (JIT) inventory? What are some of the costs and benefits?

Accepted Answer

JIT seeks to minimize or reduce an organization's inventory on hand. In doing so, the organization does not keep its resources invested in inventory, and keeps its costs to a minimum. However, if some inventory is especially important to an organization's mission or operations, JIT can leave an organization exposed to potentially not having critical supplies.

Question 2

Not all excess cash should be invested in higher earning assets; although this reduces return on the cash, it also reduces costs that arise from not having cash on hand (such as late fees). Explain your answer.

Accepted Answer

A) True 
 B)False  True

Question 3

What is the implicit interest rate for an organization that takes a discount of 1/10 N/25 on a $13,000 invoice?

Accepted Answer

=RATE(15, 0, 12870, -13000)
= 0.07% *365 days = 24.46%

Question 4

What are two tools that managers use to manage working capital?

Accepted Answer

Cash flow

Question 5

Identify the reasons that a health care organization needs cash on hand.

Accepted Answer

A)  For emergencies 
B)  To pay employees higher salaries 
C)  To subsidize clients that cannot pay full price 
D)  To take advantage of unexpected investment opportunities 
E)  For normal transaction purposes 
A)  For emergencies 
B)  To pay employees higher salaries 
C)  To subsidize clients that cannot pay full price 
D)  To take advantage of unexpected investment opportunities 
E)  For normal transaction purposes

Describe just in time (JIT) inventory? What are some of the costs and benefits?

Not all excess cash should be invested in higher earning assets; although this reduces return on the cash, it also reduces costs that arise from not having cash on hand (such as late fees). Explain your answer.

What is the implicit interest rate for an organization that takes a discount of 1/10 N/25 on a $13,000 invoice?

What are two tools that managers use to manage working capital?

Identify the reasons that a health care organization needs cash on hand.

Introduction to Health Care Accounting and Financial Management

Introduction to Electronic Spreadsheets

The Financial Environment of Health Care Organizations

Accounting Concepts

Introduction to the Key Financial Statements

Valuation of Assets and Equities

Recording Financial Information

Reporting Financial Information: a Closer Look at the Financial Statements

The Role of the Outside Auditor

Depreciation: Having Your Cake and Eating It Too

Inventory Costing: The Accountants World of Make-Believe

An Even Closer Look at Financial Statements

Notes to the Financial Statements: The Inside Story

Ratio Analysis: How Do We Compare to Other Health Care Organizations

Investment Analysis: What Should We Do Next

Capital Structure: Long-Term Debt and Equity Financing

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Exam 16: Working Capital Management and Banking Relationships

Describe just in time (JIT) inventory? What are some of the costs and benefits?

Not all excess cash should be invested in higher earning assets; although this reduces return on the cash, it also reduces costs that arise from not having cash on hand (such as late fees). Explain your answer.

What is the implicit interest rate for an organization that takes a discount of 1/10 N/25 on a $13,000 invoice?

What are two tools that managers use to manage working capital?

Identify the reasons that a health care organization needs cash on hand.

Introduction to Health Care Accounting and Financial Management

Introduction to Electronic Spreadsheets

The Financial Environment of Health Care Organizations

Accounting Concepts

Introduction to the Key Financial Statements

Valuation of Assets and Equities

Recording Financial Information

Reporting Financial Information: a Closer Look at the Financial Statements

The Role of the Outside Auditor

Depreciation: Having Your Cake and Eating It Too

Inventory Costing: The Accountants World of Make-Believe

An Even Closer Look at Financial Statements

Notes to the Financial Statements: The Inside Story

Ratio Analysis: How Do We Compare to Other Health Care Organizations

Investment Analysis: What Should We Do Next

Capital Structure: Long-Term Debt and Equity Financing

Filters