HSA 400 FINAL EXAM- CH. 13-14, 20-22. EXAM QUESTIONS
AND ANSWERS NEWEST RATED A+ NEW EDITION
List the four major categories of cost. - Ans -1) Traceability to the object being costed
-2) Behavior of Cost to Output or Activity.
-3) Management Responsibility for Control
-4) Future Costs Versus Historical Costs
Describe the relationship between Financial Planning & Strategic Planning. - Ans -1) Both
responsible of the Board of Trustees.
-2) Strategic Management should precede financial planning.
-3) The board should play an active not a passive role in the financial planning process.
Key Policy targets: growth rate in assets, debt policy & profitability objective (return on equity).
List the four steps involved in the development of a financial plan. - Ans -1) Assess Financial
Position
-2) Growth Needs in Total Assets for the Planning Period
-3) Define Acceptable level of debt for both current & long-term categories.
-4) Assess reasonableness of required growth rate in equity.
Describe the "Assess Financial Position" Step in the development of a financial plan. - Ans -It is
important to determine the current financial health and position of the firm.
two categories:
1) financial statements for the past 3-5 years.
2) financial evaluation using the ratio analysis.
, Describe the "Growth Needs in Total Assets for the Planning Period" Step in the development
of a financial plan. - Ans -It is impossible to forecast asset investment without first forecasting
revenues as well as expenses.
Describe the "Define Acceptable level of debt for both current & long-term categories" Step in
the development of a financial plan. - Ans -Define the desired levels of investment for OHF,
define the debt policy during the 5-year forecast period. -long-term debt, accrued salaries, &
wages, due to third-party payers.
Describe the "Assess reasonableness of required growth rate in equity. " Step in the
development of a financial plan. - Ans -These two questions must be answered before a
financial plan can be accepted:
-1) can we actually achieve the results currently projected, or are our assumptions realistic?
-2) Are the financial results projected acceptable, or are we satisfied with the current projected
financial performance?
Discuss some ways to classify costs? - Ans -Categorized in different ways to meet the specific
needs of decisionmakers.
-Classification: direct/indirect (traceability), Management control
(controllable/noncontrollable), Budgeted/actual (relation to budget), Fixed costs/variable costs
(relation to activity), and avoidable & sunk cost (relation to time).
Describe the major category of cost, "Traceability to the object being costed". - Ans -Most
basic.
-Direct/indirect.
-Falls into these categories: Product, process, department and activity.
Describe Cost Object. - Ans -An item for which a separate cost measurement is required:
product, process, department, activity.
AND ANSWERS NEWEST RATED A+ NEW EDITION
List the four major categories of cost. - Ans -1) Traceability to the object being costed
-2) Behavior of Cost to Output or Activity.
-3) Management Responsibility for Control
-4) Future Costs Versus Historical Costs
Describe the relationship between Financial Planning & Strategic Planning. - Ans -1) Both
responsible of the Board of Trustees.
-2) Strategic Management should precede financial planning.
-3) The board should play an active not a passive role in the financial planning process.
Key Policy targets: growth rate in assets, debt policy & profitability objective (return on equity).
List the four steps involved in the development of a financial plan. - Ans -1) Assess Financial
Position
-2) Growth Needs in Total Assets for the Planning Period
-3) Define Acceptable level of debt for both current & long-term categories.
-4) Assess reasonableness of required growth rate in equity.
Describe the "Assess Financial Position" Step in the development of a financial plan. - Ans -It is
important to determine the current financial health and position of the firm.
two categories:
1) financial statements for the past 3-5 years.
2) financial evaluation using the ratio analysis.
, Describe the "Growth Needs in Total Assets for the Planning Period" Step in the development
of a financial plan. - Ans -It is impossible to forecast asset investment without first forecasting
revenues as well as expenses.
Describe the "Define Acceptable level of debt for both current & long-term categories" Step in
the development of a financial plan. - Ans -Define the desired levels of investment for OHF,
define the debt policy during the 5-year forecast period. -long-term debt, accrued salaries, &
wages, due to third-party payers.
Describe the "Assess reasonableness of required growth rate in equity. " Step in the
development of a financial plan. - Ans -These two questions must be answered before a
financial plan can be accepted:
-1) can we actually achieve the results currently projected, or are our assumptions realistic?
-2) Are the financial results projected acceptable, or are we satisfied with the current projected
financial performance?
Discuss some ways to classify costs? - Ans -Categorized in different ways to meet the specific
needs of decisionmakers.
-Classification: direct/indirect (traceability), Management control
(controllable/noncontrollable), Budgeted/actual (relation to budget), Fixed costs/variable costs
(relation to activity), and avoidable & sunk cost (relation to time).
Describe the major category of cost, "Traceability to the object being costed". - Ans -Most
basic.
-Direct/indirect.
-Falls into these categories: Product, process, department and activity.
Describe Cost Object. - Ans -An item for which a separate cost measurement is required:
product, process, department, activity.
