NAB FINANCIAL EXAMINATION TEST 2026
COMPLETE QUESTIONS AND ANSWERS
GRADED A+
◉ The process of identifying, recording, and communicating
information about the financial position and results of operations of
a business entity, using principles designed to facilitate informed
decision-making by the entity's managers as well as by external
groups. Answer: Accounting
◉ Assets = Liabilities + Owners' Equity (capital). This equation
states that the assets of a firm are equal to the claims of the creditors
plus the claims of the owners. The balance sheet is a detailed
statement of this equation. Answer: Accounting Equation
◉ Amounts owed to suppliers for goods and services. Answer:
Accounts Payable
◉ Amounts owed to the facility for services or for the sale of goods.
Answer: Accounts Receivable
◉ A system of accounting in which revenues are recorded in the
period earned, and expenses are recorded in the period incurred
even if cash is received or paid in a later or earlier time period.
,(Contrast with cash basis of accounting) Answer: Accrual Basis of
Accounting
◉ The total depreciation from the start of the life of a plant asset to
any point in time. Answer: Accumulated Depreciation
◉ Cash and other current assets that can be converted to cash right
away (such as marketable securities and current receivables)
divided by current liabilities. A measure of the ability of a firm to pay
its current liabilities in the very short term (see also CURRENT
RATIO). Answer: Acid-Test Ratio (Quick Ratio)
◉ Entries made at the end of an accounting period to record certain
transactions or other accounting events that have not been recorded
or have been improperly recorded during the accounting period.
Examples include entries for depreciation expense and unused
portions of prepaid expenses. Answer: Adjusting Entries
◉ Information technology that is designed to assist in carrying out
financial and administrative support activities such as payroll,
patient accounting, billing, accounts receivable, materials
management, budgeting, cost control and office automation.
Answer: Administrative Information System
◉ Summarizing unpaid balances in terms of age groups, such as:
currently due, 1-30 days past due, 31-60 days past due each of the
, remaining 30-day periods through 151-180 days past due, and
finally past due more than 180 days. This classification may be
broken down by type of debtor. Aging receivables is a step in the
collections effort, in reporting on the balance sheet a deduction from
accounts receivable for estimated bad debt, and in making write-off
decisions. Answer: Aging of Accounts Receivable
◉ Also called an "aging report," it shows the length of time that
various amounts within each patient's account have been
outstanding (not paid) Answer: Aging Schedule
◉ The maximum fee that a third party will use in reimbursing or
paying a provider for a service rendered. Answer: Allowable Charge
◉ Costs that are reimbursable under a third-party payment formula.
Answer: Allowable Costs
◉ The periodic reduction of a debt by regular payments applied to
both principal and interest over a scheduled period. Answer:
Amortization of Debt
◉ Extra charges for supplies and services, e.g., drugs and lab tests,
that are not included in the per diem rate. Answer: Ancillary Charges
COMPLETE QUESTIONS AND ANSWERS
GRADED A+
◉ The process of identifying, recording, and communicating
information about the financial position and results of operations of
a business entity, using principles designed to facilitate informed
decision-making by the entity's managers as well as by external
groups. Answer: Accounting
◉ Assets = Liabilities + Owners' Equity (capital). This equation
states that the assets of a firm are equal to the claims of the creditors
plus the claims of the owners. The balance sheet is a detailed
statement of this equation. Answer: Accounting Equation
◉ Amounts owed to suppliers for goods and services. Answer:
Accounts Payable
◉ Amounts owed to the facility for services or for the sale of goods.
Answer: Accounts Receivable
◉ A system of accounting in which revenues are recorded in the
period earned, and expenses are recorded in the period incurred
even if cash is received or paid in a later or earlier time period.
,(Contrast with cash basis of accounting) Answer: Accrual Basis of
Accounting
◉ The total depreciation from the start of the life of a plant asset to
any point in time. Answer: Accumulated Depreciation
◉ Cash and other current assets that can be converted to cash right
away (such as marketable securities and current receivables)
divided by current liabilities. A measure of the ability of a firm to pay
its current liabilities in the very short term (see also CURRENT
RATIO). Answer: Acid-Test Ratio (Quick Ratio)
◉ Entries made at the end of an accounting period to record certain
transactions or other accounting events that have not been recorded
or have been improperly recorded during the accounting period.
Examples include entries for depreciation expense and unused
portions of prepaid expenses. Answer: Adjusting Entries
◉ Information technology that is designed to assist in carrying out
financial and administrative support activities such as payroll,
patient accounting, billing, accounts receivable, materials
management, budgeting, cost control and office automation.
Answer: Administrative Information System
◉ Summarizing unpaid balances in terms of age groups, such as:
currently due, 1-30 days past due, 31-60 days past due each of the
, remaining 30-day periods through 151-180 days past due, and
finally past due more than 180 days. This classification may be
broken down by type of debtor. Aging receivables is a step in the
collections effort, in reporting on the balance sheet a deduction from
accounts receivable for estimated bad debt, and in making write-off
decisions. Answer: Aging of Accounts Receivable
◉ Also called an "aging report," it shows the length of time that
various amounts within each patient's account have been
outstanding (not paid) Answer: Aging Schedule
◉ The maximum fee that a third party will use in reimbursing or
paying a provider for a service rendered. Answer: Allowable Charge
◉ Costs that are reimbursable under a third-party payment formula.
Answer: Allowable Costs
◉ The periodic reduction of a debt by regular payments applied to
both principal and interest over a scheduled period. Answer:
Amortization of Debt
◉ Extra charges for supplies and services, e.g., drugs and lab tests,
that are not included in the per diem rate. Answer: Ancillary Charges
