Financial Resource Management in
Healthcare - C428 Exam Questions and
Answers Graded A+
A medical center is expanding its hospital staff to accommodate the increasing
number of flu cases seen over the past weeks.Which type of finance activity is
described in this scenario? - Correct answer-COST
A healthcare organization's senior finance leader is responsible for all financial
plans and activities related to reimbursement, accounting, budgeting, and
management for a healthcare system's financial well-being.Which role matches this
description? - Correct answer-CFO
The most common structures of hospitals are religious, secular, or academic. These
organizations raise capital through donations and tax-exempt debt.What is the legal
structure of hospitals that raise capital through these means? - Correct answer-Not-
for-profit: to meet charitable purposes
An established diagnostic center needs a new mammogram machine. The center
has incurred higher debt and is very highly leveraged but decides to apply for
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,another secured loan at its local bank.What will the bank decide about the secured
loan? - Correct answer-The interest rate will be higher.
A private hospital with a successful history of traditional patient care is seeking to
open a holistic treatment center off-site. It has secured an initial loan of five
million dollars.How would the nature of this venture affect the interest rate that
could be expected on the loan? - Correct answer-A higher interest rate loan due to
the alternative patient care
A healthcare organization has the following financial information available in a
balance sheet:Assets:
Cash of $10,000
Accounts receivable of $5,000
Machinery & equipment of $50,000
Liabilities:
Accounts payable of $6,000
Loans payable of $25,000
Common stock of $34,000
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, The organization decides to use $5,000 of the organization cash reserves to pay off
some of the loans payable of $25,000.What is the organization's business debt after
the debt is paid off? - Correct answer-$26,000
A not-for-profit clinic is required to make monthly payments of $31,819.65 for the
next 10 years to repay its long-term debt. The interest rate is 5%.What is the
clinic's current level of business debt? - Correct answer-$3 million
An insurance group is in the process of evaluating a zero coupon bond purchase
from a healthcare organization that needs capital financing. On January 1, 2001,
the bonds were purchased at a discounted rate of $6,757.04 with a 5.5% original-
issue yield and semiannual compounding.On which date will they become due if
these bonds have a face value of $20,000, and assuming the interest rates remain
stable? - Correct answer-January 1, 2021
A healthcare company is a non-profit provider but has had problems maintaining
any significant cash balance in its portfolio. The current market trend is favorable
long-term interest rates, and the healthcare company wishes to build an addition
and repay debt over 20 years.Which debt financing vehicle will provide lower
interest payments for this situation? - Correct answer-Internal rate of return
An assisted living center administrator has determined that a renovation of the
rehabilitation center will increase the profitability of the organization. Although
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Healthcare - C428 Exam Questions and
Answers Graded A+
A medical center is expanding its hospital staff to accommodate the increasing
number of flu cases seen over the past weeks.Which type of finance activity is
described in this scenario? - Correct answer-COST
A healthcare organization's senior finance leader is responsible for all financial
plans and activities related to reimbursement, accounting, budgeting, and
management for a healthcare system's financial well-being.Which role matches this
description? - Correct answer-CFO
The most common structures of hospitals are religious, secular, or academic. These
organizations raise capital through donations and tax-exempt debt.What is the legal
structure of hospitals that raise capital through these means? - Correct answer-Not-
for-profit: to meet charitable purposes
An established diagnostic center needs a new mammogram machine. The center
has incurred higher debt and is very highly leveraged but decides to apply for
©COPYRIGHT 2025, ALL RIGHTS RESERVED 1
,another secured loan at its local bank.What will the bank decide about the secured
loan? - Correct answer-The interest rate will be higher.
A private hospital with a successful history of traditional patient care is seeking to
open a holistic treatment center off-site. It has secured an initial loan of five
million dollars.How would the nature of this venture affect the interest rate that
could be expected on the loan? - Correct answer-A higher interest rate loan due to
the alternative patient care
A healthcare organization has the following financial information available in a
balance sheet:Assets:
Cash of $10,000
Accounts receivable of $5,000
Machinery & equipment of $50,000
Liabilities:
Accounts payable of $6,000
Loans payable of $25,000
Common stock of $34,000
©COPYRIGHT 2025, ALL RIGHTS RESERVED 2
, The organization decides to use $5,000 of the organization cash reserves to pay off
some of the loans payable of $25,000.What is the organization's business debt after
the debt is paid off? - Correct answer-$26,000
A not-for-profit clinic is required to make monthly payments of $31,819.65 for the
next 10 years to repay its long-term debt. The interest rate is 5%.What is the
clinic's current level of business debt? - Correct answer-$3 million
An insurance group is in the process of evaluating a zero coupon bond purchase
from a healthcare organization that needs capital financing. On January 1, 2001,
the bonds were purchased at a discounted rate of $6,757.04 with a 5.5% original-
issue yield and semiannual compounding.On which date will they become due if
these bonds have a face value of $20,000, and assuming the interest rates remain
stable? - Correct answer-January 1, 2021
A healthcare company is a non-profit provider but has had problems maintaining
any significant cash balance in its portfolio. The current market trend is favorable
long-term interest rates, and the healthcare company wishes to build an addition
and repay debt over 20 years.Which debt financing vehicle will provide lower
interest payments for this situation? - Correct answer-Internal rate of return
An assisted living center administrator has determined that a renovation of the
rehabilitation center will increase the profitability of the organization. Although
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