Deck 24: Financial and Practice Management

Question 1

A peg-board system, either manual or computerized, is common in the medical office.

Answer 1

True

Question 2

Single-entry bookkeeping is expensive to use.

Answer 2

False

Question 3

The medical assistant would not be responsible for completing the end-of-day summarizing due to the difficulty of the calculations.

Answer 3

False

Question 4

The Employee's Withholding Allowance Certificate is Form W-4.

Question 5

A profit and loss statement is also known as a statement of income and expense.

Question 6

The hardest system of bookkeeping to use is the single-entry system.

Question 7

Expenses in the medical office should be monitored on a monthly basis to remain within the budget.

Question 8

A packing slip describes the contents of a package.

Question 9

A statement is a request for an invoice.

Question 10

Most states have federal unemployment compensation laws.

Question 11

An accurately completed purchase order helps eliminate mistakes in the order and in shipments.

Question 12

Employers must file a quarterly federal tax return.

Question 13

Errors made in posting can only be discovered by doing the entire day sheet over.

Question 14

Some medical offices require the person who has been charged with handling financial duties to be bonded.

Question 15

The purpose of the trial balance is to disclose any discrepancies between the journal and the ledger.

Question 16

Annual FUTA returns must be filed before January 1 following the close of the calendar year.

Question 17

Computer posting software is a timesaver in the medical office.

Question 18

The basic principles of accounting are the same, no matter what system is used.

Question 19

Petty cash funds are usually kept in a locked cash drawer or box.

Question 20

FUTA deals with office credit policies.

Question 21

State unemployment taxes are always imposed on the employee.

Question 22

A statement of income and expense is a type of accounting report.

Question 23

A system of recording, classifying, and summarizing financial transactions is called:

A)bookkeeping
B)accounting
C)accruing
D)depreciation

Question 24

Total income is the same as gross income.

Question 25

The total of petty cash vouchers and receipts plus the amount of cash on hand should always equal the original amount of the fund.

Question 26

The disbursement journal should show:

A)every amount paid out
B)interest accrued
C)total payables
D)all of the above

Question 27

Liabilities = Assets + Proprietorship.

Question 28

Minor unpredictable expenses should be paid from the:

A)regular checking account
B)savings account
C)petty cash
D)whatever is most available

Question 29

The financial records of any business should always show how much:

A)has been collected
B)is owed
C)was earned in a given period
D)all of the above

Question 30

The "cash basis" system of accounting used by most physicians means that:

A)credit is used as little as possible
B)charges are recorded as income at the time they are received
C)a simple bookkeeping system is used
D)expenses are recorded at the time they are incurred

Question 31

FUTA relates to unemployment.

Question 32

An employee's marital status can affect the amount of income tax withholding taken from his or her paycheck.

Question 33

A statement of financial condition is also known as a balance sheet.

Question 34

A trial balance should be done:

A)once per week
B)twice per week
C)once per month
D)twice per month

Question 35

All offices use petty cash to make change.

Question 36

Cardinal rules for bookkeeping include:

A)good penmanship
B)legible records
C)straight columns of figures
D)all of the above

Question 37

The chronologic record of the medical practice is the ______ journal.

A)daily
B)ledger
C)disbursement
D)monthly

Question 38

Which statement best describes the relationship between bookkeeping and accounting?

A)Accounting is a summary of the activities of bookkeeping.
B)Bookkeeping takes care of all the reporting activities of accounting.
C)Accounting plans the bookkeeping process.
D)Bookkeeping involves the recording activities of accounting.

Question 39

Which one of the following words or phrases cannot be used interchangeably with the others?

A)Capital
B)Interest
C)Proprietorship
D)Net worth

Question 40

Complete and correct financial records are necessary for:

A)prompt billing and collection procedures
B)professional financial planning
C)accurate reporting of income
D)all of the above

Question 41

W-2 forms should be given to all employees before what date each year?

A)January 1
B)December 31
C)January 31
D)December 1

Question 42

Which of the following is not a drawback to the single-entry accounting system?

A)Errors are not easily detected.
B)The system has no built-in controls.
C)It satisfies governmental reporting regulations.
D)Periodic analyses are inadequate for financial planning.

Question 43

For every disbursement from the petty cash fund, what should be completed?

A)Balance sheet
B)Invoice
C)Packing slip
D)Voucher

Question 44

Which accounting system requires the least initial expense and training to set up and use?

A)Double-entry
B)Peg-board
C)Single-entry
D)There is very little difference among the three.

Question 45

When the end-of-month accounts receivable figures agree with the figures arrived at by adding all the account card balances, the accounts are said to be:

A)false
B)in balance
C)out of balance
D)matching

Question 46

If the physician's financial situation is summarized in the basic accounting equation, which of the following would be included in the liability component?

A)The value of the office equipment owned
B)Amounts owed by insurance companies
C)Amount of cash in the checking account
D)Amount owed to a medical supply company

Question 47

The properties owned by a business are called:

A)assets
B)liabilities
C)equities
D)accounts

Question 48

The Transmittal of Income and Tax Statement must be transmitted annually using form:

A)W-2
B)W-3
C)W-4
D)W-5

Question 49

A summary of accounts paid out is called the __________ journal.

Question 50

Assets = Liabilities + _________.

A)Disbursements
B)Interest
C)Proprietorship
D)Income

Question 51

Which accounting system has the least chance of errors because of the small amount of posting required?

A)Double-entry
B)Peg-board
C)Single-entry
D)There is very little difference among the three.

Question 52

All of the following are determinants of withholding amounts except:

A)the number of withholding allowances claimed
B)the length of the pay period involved
C)the employee's total earnings
D)insurance deductions

Question 53

Which of the following is not a common summary report?

A)Trial balance
B)Invoice
C)Statement of income and expense
D)Balance sheet

Question 54

To determine that the books for the practice are in balance, the medical assistant can perform a(n):

A)trial balance
B)balance sheet
C)cash flow statement
D)end-of-day summary

Question 55

Disbursements in a medical office might include:

A)rent
B)utilities
C)dues
D)all of the above

Question 56

Which of the following records must be available for review by the IRS?

A)Employees' Social Security numbers
B)The number of withholding allowances claimed
C)The amount of gross salary
D)All of the above

Question 57

The method of accounting in which income is recorded when earned and expenses are recorded when incurred is called the __________ basis of accounting.

Question 58

Which form is used to apply for a Social Security card?

A)SS-5
B)SS-4
C)SS-3
D)SS-2

Question 59

At the end of the day, the medical assistant discovers a numeric error on an encounter form; all of the following actions should be taken except:

A)erase the error cleanly before writing in new numbers
B)reinsert the ledger card before making the correction
C)make a new receipt for the patient
D)make sure the proper amount was billed to the insurance company

Question 60

The purpose of the disbursement journal is to keep a record of the amount:

A)in the checking account
B)owed by the physician
C)paid out for various expenses
D)owed to the physician

Question 61

The recording of business and accounting transactions is called __________.

Question 62

__________ coverage is one of the physician's major expenses.

Question 63

To estimate the budget for a new year, the practice should evaluate expenses from the __________ year.

Question 64

Receipts are usually deposited in a(n) __________ account.

Question 65

Accounts __________ are debts incurred but not yet paid.

Question 66

The entire property of a person is said to be his or her __________.

Question 67

Employers must file tax returns __________.

Question 68

All financial records should be complete and accurate.Records must be __________ and completed on a daily basis.

Question 69

FICA stands for the Federal Insurance __________ Act.

Question 70

Individuals file a tax return __________.

Question 71

The monetary value of a property or of an interest in a property in excess of claims or liens against it is called __________.

Question 72

The daily journal day sheet is a(n) __________ record of the practice, similar to a financial diary.

Question 73

The petty cash fund is a(n) __________ fund.

Question 74

A record or notation of a transaction is called a(n) __________.

Question 75

Amounts owed to the physician are accounts __________.

Question 76

Figure __________ should be kept straight and figures well formed.

Question 77

Something that is owed is called a(n) __________.

Question 78

Each employer must have a federal tax __________ number.

Question 79

A request for payment is called a(n) __________.

Question 80

A cash __________ statement is a financial summary for a specific period.