Deck 3: Principles and Practices of Health Care Accounting

Question 1

Transactions summarized by account are called:

A) Journal
B) Ledger
C) Balance
D) Asset

Answer 1

Ledger

Question 2

Which of the following is a standard accounting method used in health care?

A) Accrual
B) Cash
C) Expense
D) Asset

Answer 2

Accrual

Question 3

Rules for recording transactions do not include:

A) Increase in revenues, gains or other support account when earnings are received.
B) After each transaction, the fundamental account equation must be in balance.
C) An accounting method when cash was received or expended.
D) Increase an expense account when an asset is used.

Answer 3

An accounting method when cash was received or expended.

Question 4

To develop financial statements, transactions

A) Must be on a cash basis
B) Are recorded according to staff availability
C) Focus only on assets
D) Have been analyzed and recorded

Question 5

Statement of Operations includes:

A) Operating Expenses
B) Increase in unrestricted net assets
C) a & b
D) None of the above

Question 6

A statement of cash flows includes:

A) Cash flows from operating activities
B) Cash flows from investing activities
C) Cash flows from financing activities
D) All of the above

Question 7

The "book" refers to transactions

A) Only done by computer entry
B) Journal recorded chronologically
C) Current balance in each account
D) Current ratio

Question 8

In the accrual accounting method:

A) Revenues are recognized when cash is received
B) Expenses are recognized when cash is paid out
C) Revenues are recognized when revenues are earned
D) All of the above

Question 9

Functions of an internal audit department include:

A) Resources used to generate revenues
B) Ensuring that hospitals comply with their financial record keeping
C) Reporting and recording of revenues and expenses
D) b & c

Question 10

Recording transactions assists in:

A) Accuracy of financial acts
B) Summarizing accounts
C) Ease of tracking financial transactions
D) All of the above

Question 11

Transactions are recorded chronologically in a journal.

Question 12

In health care the cash accounting method is used.

Question 13

Recording of transactions is to occur each quarter.

Question 14

Under accrual accounting, revenues are recognized when cash is received.

Question 15

When cash is paid out, expense is recognized where no resources were used.

Question 16

A statement of cash flows provides information about how much revenue e is generated and amount of resources used.

Question 17

The statement of operations answers the question of how to record transactions.

Question 18

Electronic health record has financial reporting value.

Question 19

Contra-asset is an asset that when increased, decreases the value of a related asset on the books.

Question 20

A balance sheet highlights assets, liabilities and resources used.