FINANCIAL MANAGEMENT- TEST
QUESTIONS AND ANSWERS 2025
An _________ covers how the day-to-day operating expenses, ie. labor and supplies,
and revenue will occur; a n _________ covers expensive equipment whose usefulness
will last over many years. <correct answer>Operating budget; capital budget.
Healthcare organizations use cost accounting and document costs because their
insurers expect accurate, honest, and complete records of every dollar of
cost. <correct answer>True.
An operating budget is one type of budget. This is the budget used to plan/anticipate the
unit's day-to-day expenses and revenues. The operating
budget is a written plan -much like a plan of care for a patient- that tries to
project/anticipate operating expenses and revenues. <correct answer>Operating
expenses are estimated by collecting data, especially data on patient volume, patient
acuity, and required staffing and supply levels for providing care. Once the data is
collected, the nurse manager can estimate the next year's expenses by: looking at last
year's costs, adjusting for inflation, then adjusting for any increases likely in patient
census and subsequently, nursing staff.
Understanding financial statements helps nurse managers know if the organization's
income is enough to cover its expenses and losses. <correct answer>True. Yes, the
ability to read financial statements helps us know if the organization is healthy.
Unlike variable costs, such as fuel costs for an airline, fixed costs are the same
regardless of volume. Similarly, fixed staff are those present regardless of patient
volume. In light of these facts, _________ are examples of fixed staff and
___________are examples of variable staff. <correct answer>Nurse managers; direct
care nurses. This is correct. Nurse managers are an example of fixed staff because
, their presence or numbers does not depend on patient volume or acuity. The number of
direct care nurses, however, would depend on patient volume.
It is not important to track costs to stay "solvent" or financially healthy. <correct
answer>False: Actually tracking costs is very important to staying solvent or financially
healthy. This is especially true in healthcare where the difference between revenues
and losses is often razor thin.
An example of a mission statement is: <correct answer>NOT TO BELIEVE IN ETHICAL
PRINCIPLES.
? to break even after taxes *don;t think so.
?to become the hospital of choice for physicians. -maybe
?to provide healthcare in a given service area.- maybe but don't think so.
In healthcare economics, people and organizations that deliver healthcare services to
patients are called: <correct answer>providers.
An example of a common market condition in the healthcare financial environment is:
<correct answer>intense competition.
As a cost center, one financial responsibility of a nurse manager of a nursing unit is to:
<correct answer>control expenses.
Manufacturers and distributors of all supplies, equipment and technology used in
healthcare organizations are referred to as: <correct answer>suppliers.
The Chief Financial Officer is a member of the top management team. <correct
answer>True.
A nursing unit is <correct answer>one part of the organization.
QUESTIONS AND ANSWERS 2025
An _________ covers how the day-to-day operating expenses, ie. labor and supplies,
and revenue will occur; a n _________ covers expensive equipment whose usefulness
will last over many years. <correct answer>Operating budget; capital budget.
Healthcare organizations use cost accounting and document costs because their
insurers expect accurate, honest, and complete records of every dollar of
cost. <correct answer>True.
An operating budget is one type of budget. This is the budget used to plan/anticipate the
unit's day-to-day expenses and revenues. The operating
budget is a written plan -much like a plan of care for a patient- that tries to
project/anticipate operating expenses and revenues. <correct answer>Operating
expenses are estimated by collecting data, especially data on patient volume, patient
acuity, and required staffing and supply levels for providing care. Once the data is
collected, the nurse manager can estimate the next year's expenses by: looking at last
year's costs, adjusting for inflation, then adjusting for any increases likely in patient
census and subsequently, nursing staff.
Understanding financial statements helps nurse managers know if the organization's
income is enough to cover its expenses and losses. <correct answer>True. Yes, the
ability to read financial statements helps us know if the organization is healthy.
Unlike variable costs, such as fuel costs for an airline, fixed costs are the same
regardless of volume. Similarly, fixed staff are those present regardless of patient
volume. In light of these facts, _________ are examples of fixed staff and
___________are examples of variable staff. <correct answer>Nurse managers; direct
care nurses. This is correct. Nurse managers are an example of fixed staff because
, their presence or numbers does not depend on patient volume or acuity. The number of
direct care nurses, however, would depend on patient volume.
It is not important to track costs to stay "solvent" or financially healthy. <correct
answer>False: Actually tracking costs is very important to staying solvent or financially
healthy. This is especially true in healthcare where the difference between revenues
and losses is often razor thin.
An example of a mission statement is: <correct answer>NOT TO BELIEVE IN ETHICAL
PRINCIPLES.
? to break even after taxes *don;t think so.
?to become the hospital of choice for physicians. -maybe
?to provide healthcare in a given service area.- maybe but don't think so.
In healthcare economics, people and organizations that deliver healthcare services to
patients are called: <correct answer>providers.
An example of a common market condition in the healthcare financial environment is:
<correct answer>intense competition.
As a cost center, one financial responsibility of a nurse manager of a nursing unit is to:
<correct answer>control expenses.
Manufacturers and distributors of all supplies, equipment and technology used in
healthcare organizations are referred to as: <correct answer>suppliers.
The Chief Financial Officer is a member of the top management team. <correct
answer>True.
A nursing unit is <correct answer>one part of the organization.
