General ACCA Financial Management MCQs

1. An assignment or grading of the likelihood that an organization will not default on a bond.

2. Future value. What an amount invested today (or a series of payments made over time) will be worth at a given time in the future using the compound interest method. This accounts for the time value of money. See also Present value.

3. Organizations that have a special designation because they provide goods or services that result in needed community benefit. In turn - such organizations are not required to pay most taxes. 2) The designation of an organization as one that is not

4. The changes in cash resulting from the normal operating activities of the organization.

5. The budget that projects the organization's cash inflows and outflows. The bottom line in the cash budget is the amount of cash available at the end of the period.

6. The revenue and expense budgets of an organization.

7. An entity that sells bonds in order to raise money.

8. Assets that have restrictions on their use which will be removed either with the passage of time or the occurrence of some event.

9. A donation that has conditions which must be satisfied. See also Temporarily restricted net assets.

10. Activity-based costing. A method to determine the costs of a service - product - or customer by tracing the resources consumed. ABC focuses on: I) controlling as well as calculating costs - 2) tracing as opposed to allocating costs - and 3) the impor

11. The budget format that lists revenues and expenses by category - such as labor - travel - and supplies. Categories are sometimes broken down into sub-categories. See also Performance budget and Program budget.

12. The cumulative amount of depreciation recognized on an asset since its purchase. An asset's book value is equal to its purchase price less the amount of accumulated depreciation.

13. A borrower's assets on which a lender has legal claim if a borrower defaults on a loan.

14. Financing that will be paid back in less than one year.

15. The degree to which standards are met.

16. The budget used to forecast operating expenses.

17. Amounts due to the organization from patients - third parties - and others.

18. A statement intended to guide the organization into the future by identifying the unique attributes of the organization - why it exists - and what it hopes to achieve.

19. What a series of equal payments in the future is worth today taking into account the time value of money.

20. Any product - service - customer - contract - project - process or other work unit for which a separate cost measurement is desired.

21. An entity that gives capital to another entity in expectation of a financial or non-financial return.

22. General and administrative expenses. Operating expenses that are not contained in the labor or supplies budgets.

23. An estimate/measure of how much a tangible asset (such as plant or equipment) has been "used up" during an accounting period. It is an expense that does not require any cash outflow under the accrual basis of accounting. See also Accumulated deprecia

24. [(cash + marketable securities + net accounts receivable)/current liabilities)- A measure of the organization's liquidity.

25. Costs not traced to a cost object - but that must eventually be allocated across cost objects. See also Direct costs.

26. A series of equal cash flows made or received at regular time intervals. Ordinary annuities occur at the end of each period whereas annuities due occur at the beginning of each period.

27. A section of the statement of cash flows used to report such activities as borrowing and paying back loans.

28. (excess of revenues over expenses/total assets)- A measure of how much profit is earned for each dollar invested in assets. In for-profit organizations it is called return on assets and is calculated as: net income/assets.

29. The resources owned by the organization. It is one of the three major categories on the balance sheet.

30. Current year budget projected for the coming fiscal year assumes no program changes and adjust for price - workload - annualizations

31. [Total Revenues/(Net Fixed Assets)]. This ratio measures the number of dollars generated for each dollar invested in an organization's fixed assets (i.e. plant and equipment).

32. An organization whose profits can be distributed outside the organization and must pay taxes. Also called investor-owned organizations.