Deck 5: Working Capital Management

Question 1

The working capital cycle includes:

A) Obtaining cash
B) Billing and collections
C) Providing Services
D) All of the above

Answer 1

All of the above

Question 2

An asset mix strategy includes:

A) How an organization chooses to finance its working capital needs
B) The amount of working capital an organization keeps on hand relative to its working capital obligations
C) Risk of greater return to lower liquidity
D) Coin and currency

Answer 2

The amount of working capital an organization keeps on hand relative to its working capital obligations

Question 3

Sources of Temporary Cash include:

A) Line of Credit
B) Commitment fees
C) A & b
D) None of the above

Answer 3

A & b

Question 4

Finance mix strategy includes

A) Cash management
B) Investing excess funds in non-liquid assets
C) An aggressive asset mix strategy
D) Maximizing returns by investing in non-liquid assets

Question 5

Which of the following is not a major reason to hold cash:

A) Hedge against inflation
B) For daily operation purposes
C) Precautionary purposes
D) Speculative purposes

Question 6

Trade payable are referred to as:

A) Compensating balances
B) Commitment fees
C) Accounts payable
D) Accounts receivable

Question 7

Revenue Cycle Maintenance can be hindered by:

A) Patients giving correct demographic information
B) Lack of clarity about who is responsible for the bill
C) Current health care insurance information
D) An accurate/clean final bill

Question 8

Part of the revenue cycle is:

A) Registration
B) Charge of Capture
C) Payment
D) All of the above

Question 9

Collecting Cash payments includes:

A) Electronic billing
B) Lockboxes
C) Wire Transfer
D) b & c

Question 10

Methods to monitor accounts receivable:

A) Net accounts receivable
B) Treasury bills
C) Aging Schedule
D) a & c

Question 11

The working capital cycle has four phases.

Question 12

Asset mix is the amount of working capital an organization keeps on hand to meet its working capital obligations.

Question 13

Financing mix state what an organization can invest.

Question 14

A major reason for a health care organization to hold cash is for daily operations purposes.

Question 15

A line of credit is considered a long term commitment.

Question 16

Revenue cycle management is driver by the billing process.

Question 17

Scheduling is not a part of the revenue cycle.

Question 18

Incorrect coding of a patient bill hinders collecting that bill.

Question 19

Lockboxes are one form of collecting cash payments.

Question 20

Certificates of deposit are issued by commercial banks as non-negotiable, interest-bearing, short term certificates.