HSA 400 FINAL EXAM- CH. 13-14, 20-22 | QUESTIONS AND ANSWERS | 2025/2026 WITH
COMPLETE SOLUTION!!
List the four major categories of cost. - (ANSWER)-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. - (ANSWER)-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. - (ANSWER)-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. - (ANSWER)-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. - (ANSWER)-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. - (ANSWER)-Define the desired levels of investment for OHF, define the
, HSA 400 FINAL EXAM- CH. 13-14, 20-22 | QUESTIONS AND ANSWERS | 2025/2026 WITH
COMPLETE SOLUTION!!
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. - (ANSWER)-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? - (ANSWER)-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". - (ANSWER)-Most basic.
-Direct/indirect.
-Falls into these categories: Product, process, department and activity.
Describe Cost Object. - (ANSWER)-An item for which a separate cost measurement is required: product,
process, department, activity.
Describe Indirect and Direct costs. - (ANSWER)-Direct: can be specifically linked to a given product or
service (direct labor-salaries, supplies, rent and expenses).
-Indirect: are not easily traceable to a product or service but support production of a product or service.
(administrative overhead, depreciation, employee benefits).
Describe the major category of cost, "Behavior of Cost to output or activity". - (ANSWER)-Classified by
the degree of variability in relation to output.
-The actual measurement of cost behavior is influenced by a Department's classification of cost, which
provides the basis for categorizing costs as direct or indirect.
COMPLETE SOLUTION!!
List the four major categories of cost. - (ANSWER)-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. - (ANSWER)-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. - (ANSWER)-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. - (ANSWER)-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. - (ANSWER)-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. - (ANSWER)-Define the desired levels of investment for OHF, define the
, HSA 400 FINAL EXAM- CH. 13-14, 20-22 | QUESTIONS AND ANSWERS | 2025/2026 WITH
COMPLETE SOLUTION!!
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. - (ANSWER)-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? - (ANSWER)-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". - (ANSWER)-Most basic.
-Direct/indirect.
-Falls into these categories: Product, process, department and activity.
Describe Cost Object. - (ANSWER)-An item for which a separate cost measurement is required: product,
process, department, activity.
Describe Indirect and Direct costs. - (ANSWER)-Direct: can be specifically linked to a given product or
service (direct labor-salaries, supplies, rent and expenses).
-Indirect: are not easily traceable to a product or service but support production of a product or service.
(administrative overhead, depreciation, employee benefits).
Describe the major category of cost, "Behavior of Cost to output or activity". - (ANSWER)-Classified by
the degree of variability in relation to output.
-The actual measurement of cost behavior is influenced by a Department's classification of cost, which
provides the basis for categorizing costs as direct or indirect.
