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Q:
placing the regression line through statistical analysis is called the least-squares method. least squares means that the sum of the squares of the deviations from plotted points to regression line is: a. larger than would occur from any other way the line could be fitted to the data b. smaller than would occur from any other way the line could be fitted to the data c. the best fit d. a & b e. a & c f. b & c
Q:
when creating a graph, the regression lines can be fitted: a. through statistical analysis b. visually c. either of the above d. none of the above
Q:
the regression line that is fitted to the plotted points on a graph such as an example in the text represents: a. a line of averages b. the average c. either of the above d. neither of the above
Q:
is the percentage answer from the preceding question considered to be the: a. cvp ratio b. pv ratio c. neither of the above
Q:
assume revenue per visit is $100.00 and the variable cost per visit is $70.00. also assume the revenue figure equals 100%. what percentage is the contribution margin per visit? a. 30% b. 35% c. 70% d. none of the above
Q:
if net revenues are $500,000, variable cost is $350,000 and fixed cost is $120,000, what is the contribution margin (in dollars)? a. $350,000 b. $30,000 c. $150,000 d. none of the above
Q:
the cost-volume-profit (cvp) ratio is often called the break-even point. a. correct b. not correct c. not applicable
Q:
when operations exceed the break-even point, there will be: a. an excess of expenses over revenues b. an excess of revenues over expenses c. neither of the above; not applicable
Q:
the contribution margin computation: a. allows fixed, variable and semivariable cost classifications b. requires either fixed or variable cost classifications c. neither of the above
Q:
convenience in the computation method is the advantage of which method of analyzing mixed costs? a. the scatter graph method b. the high-low method c. either of the above d. neither of the above
Q:
the scatter graph method of performing a mixed cost analysis: a. attempts to find the mixed costs average rate of variability b. uses a graph to plot the data points c. is not usually as accurate as the high-low method d. a & b e. b & c f. all of the above
Q:
assume the following units of sales for a particular period: 900, 1,000, 975, 850, 875, 750. which of these figures should be used when analyzing mixed costs by the high-low method? a. 1,000 and 850 b. 1,000 and 750 c. 975 and 875
Q:
in a mixed cost such as telephone cost: a. the fixed portion of the cost is the charge for actually consuming the service b. the variable portion of the cost is the charge for having the service ready to use c. both of the above d. neither of the above
Q:
variable costs would typically include payroll taxes, dietarys raw food costs, and rent expense. a. correct b. not correct c. not applicable
Q:
it is possible that some expenses may be variable to one organization and fixed to another because they are handled differently by the two organizations. a. correct b. not correct c. not applicable
Q:
semivariable costs: a. have mixed elements of both semivariable and variable costs b. are sometimes called mixed costs c. both of the above d. neither of the above
Q:
the midtown nursing facility has fixed costs amounting to $200,000. at an occupancy rate of 100 patients, the fixed cost per patient amounts to $2,000. in another way to think about fixed costs, if the administrator can increase the occupancy rate to 125 patients, will the fixed cost per patient then: a. increase b. decrease c. neither of the above
Q:
the horizon hospice provides a gift basket to every new patient that is admitted to the hospice. the baskets cost $15.00 apiece. these gift basket costs represent a: a. variable cost b. semivariable cost c. fixed cost d. none of the above
Q:
the waterford clinic pays a flat monthly fee of $250 under a two-year contract for certain computer services. this monthly fee of $250 is a: a. variable cost b. semivariable cost c. fixed cost d. none of the above
Q:
if these costs for riverside nursing facility were to be shown on a graph, the appropriate total monthly costs in dollars would appear on the: a. horizontal axis b. vertical axis c. neither of the above
Q:
in the riverside nursing facility, what monthly cost changes proportionately with the number of patients in house (the volume)? a. variable cost b. semivariable cost c. fixed cost d. none of the above
Q:
costs that vary in direct proportion to changes in the volume of operations are: a. variable costs b. semivariable costs c. fixed costs d. none of the above
Q:
the manager needs to know the difference between fixed and variable costs in order to: a. compute break-even points b. compute contribution margins c. understand a basic working tool in financial management d. all of the above e. none of the above
Q:
the break-even point is the point when the contribution margin equals: a. the variable costs b. the fixed costs c. neither of the above
Q:
mixed costs may include: a. utilities b. repairs c. telephone expense d. maintenance e. all of the above f. none of the above
Q:
when activity levels or volume of operations change, semivariable costs are those that: a. do not vary in total b. vary in direct proportion c. vary, but not in direct proportion d. none of the above
Q:
if the contribution margin is expressed as a percentage of net revenues, it is often called the: a. cost-volume-profit (cvp) ratio b. profit-volume (pv) ratio c. internal rate of return (irr) d. breakeven point
Q:
when comparing the high-low method of analyzing mixed costs to the scatter graph method, the scatter graph finds the mixed cost's average rate of variability: a. more accurately b. less accurately c. about the same
Q:
when activity levels or volume of operations change, fixed costs are those costs that: a. do not vary in total b. vary in direct proportion c. neither of the above
Q:
the use of one or more supporting reports to reveal details (such as the example showing allocation of indirect cost) is considered a __________ report, because it is supporting the preceding main report.
Q:
as a rule of thumb, if the answer to the following question is "yes", than the cost is a/an __________ cost: "if the operating unit (such as a department) did not exist, would this cost not be in existence?"
Q:
another term for responsibility center is __________.
Q:
whatever the manager is responsible for - the unit, the department or the patient - is known as a __________.
Q:
the product cost concept is important to managers of departments such as pharmacy that hold a significant amount of inventory.
Q:
product costs are matched with revenue on the basis of the period during which the cost is incurred.
Q:
one way to think of product cost is as necessary to the department, unit, etc to deliver the service, while period costs are necessary to support the existence of the organization itself.
Q:
in a responsibility center the manager is responsible for either the revenue (inflow) side or the expense (outflow) side, but is rarely responsible for both.
Q:
the manager is usually responsible for the indirect allocated expenses, but rarely responsible for the direct traceable expenses.
Q:
direct costs can be traced, while indirect costs have to be allocated.
Q:
a report example provided within the cost classifications chapter illustrates a rehab cost centers allocation of indirect costs. the indirect cost administrative salaries was allocated to three types of therapy according to the proportion of direct costs for each therapy type. assume the total administrative salaries to be allocated amounts to $100,000. further assume the proportion of direct costs is as follows: pt = 60%; ot=30%; st=10%. what is now the ot administrative salaries indirect cost allocation? a. $60,000 b. $30,000 c. $13,000 d. none of the above
Q:
dr. simms, a stubborn orthopedic surgeon, tries to get his administrator to allocate every cost on the groups income statement based on prior years results. the surgeon believes tracing direct costs is a waste of time and he says besides, the figures all come out the same anyway. is the doctor correct? a. yes b. no c. maybe
Q:
fred is responsible for revenue within his organization. generally speaking, fred is therefore responsible for: a. inflow b. outflow c. neither of the above
Q:
a report example has been provided within the cost classifications chapter that illustrates a rehab cost centers allocation of indirect costs. the indirect cost computer services was allocated to three types of therapy according to the number of computers in service for each therapy type. assume the number of computers has been changed to 20 . if the indirect cost per computer remains at $5,000, what is now the total computer services indirect cost? a. $100,000 b. $75,000 c. $200,000 d. none of the above
Q:
a pair of reports have been provided within the cost classifications chapter that illustrate a rehab cost centers direct and indirect cost. one report explains how indirect costs were allocated. the other report presents direct cost, the carried-forward indirect cost, and their totals. which of the two reports is the subsidiary report? a. the report titled example of rehab cost center direct and indirect cost totals b. the report titled example of indirect costs allocated to rehab cost center c. neither of the above
Q:
within the cost classification chapters westside example of responsibility center interactions and related reports, did the final summary report subtract negative figures from positive figures to arrive at a net result? a. yes b. no c. not applicable
Q:
within the cost classification chapter an example (westside) has been provided of responsibility center interactions between and among certain managers, their responsibilities, the lines of supervision, and their various reports. did each manager receive a report that included the figures that they themselves are responsible for? a. yes b. no c. not applicable
Q:
is a support center a responsibility center? a. yes b. no c. not applicable
Q:
sam is responsible for generating revenue for the green tree nursing center. he also fills in for the office manager on alternate weekends. is sam managing a responsibility center? a. yes b. no c. not applicable
Q:
susans sole duties involve managing and controlling cost in the great plains medical center. is sue managing a responsibility center? a, yes b, no c. not applicable
Q:
the business of hospitals and healthcare systems is typically: a. the manufacture of products b. the delivery of manufactured products c. the delivery of services d. research and development
Q:
when matching revenue and expense, the term cost of sales is the common usage for: a. manufacturing firms b. physician groups c. outpatient clinics d. nursing facilities
Q:
the product cost concept is most important to: a. a nursing unit supervisor b. a medical records director c. a pharmacy department manager
Q:
costs that are matched with revenue on the basis of the span of time during which the cost is incurred are known as: a. cost objectives b. cost centers c. product costs d. period costs
Q:
a term that was originally associated with manufacturing rather than with services such as healthcare is: a. cost objectives b. cost centers c. product costs d. period costs
Q:
another term for responsibility center is: a. profit center b. cost object c. allocation center d. neither of the above
Q:
if a cost cannot be specifically associated with a particular cost object, then it is: a. a direct cost b. an indirect cost c. either of the above d. neither of the above
Q:
any unit for which a separate cost measurement is desired may be known as a: a. cost object b. cost objective c. either of the above
Q:
costs that can be specifically associated with a particular unit or a specific patient are considered to be: a. direct costs b. indirect costs c. either of the above d. neither of the above
Q:
costs that cannot be traced are considered to be: a. direct costs b. indirect costs c. supplementary costs d. primary costs e. none of the above
Q:
costs that can be traced are considered to be: a. direct costs b. indirect costs c. supplementary costs d. primary costs e. none of the above
Q:
in many hospitals, drugs that are requisitioned by the intensive care unit (icu) are traced, and thus recorded, as part of icu costs. in this circumstance the cost is: a. an indirect cost b. a direct cost c. either of the above d. neither of the above
Q:
in many hospitals, orientation training expense (aka educational resources) is a shared expense that will be allocated to multiple departments. in these cases it is: a. an indirect cost b. a direct cost c. either of the above d. neither of the above
Q:
in most organizations, the human resources department is considered to be a: a. responsibility center b. support center c. either of the above d. neither of the above
Q:
when real estate taxes are allocated, they are considered to be: a. direct costs b. indirect costs c. either of the above d. neither of the above
Q:
certain lab technology expenses have been incurred. because these expenses are for the particular benefit of the radiology department, they are considered to be: a. direct costs b. indirect costs c. neither of the above
Q:
indirect costs are sometimes called: a. common costs b. uniform costs c. joint costs d. a & b e. a & c f. b & c g. none of the above
Q:
examples of indirect cost include the following (indicate all that apply): a. the inpatient nursing department b. the controllers office c. the grounds maintenance department d. the outpatient emergency department e. a & b f. b & c g. a & d
Q:
a responsibility center report typically should show: a. controllable revenues b. controllable expenses he/she is responsible for c. both of the above
Q:
indirect costs are for: a. the sole benefit of a particular operating unit b. the benefit of the overall operation c. neither of the above
Q:
an expense that provides service directly related to patient care is generally called an __________ expense.
Q:
in the case of non-profit organizations, does the outflow of expenses increase or decrease fund balance?
Q:
a cost center is one form of __________ center.
Q:
in healthcare organizations, it is not very common to find departments as cost centers.
Q:
if an expense is recorded in the accounts payable account, it is then cleared from accounts payable when payment is made.
Q:
disbursements for services will trigger payment only when the expense is incurred.
Q:
the standard, traditional and consistent arrangement of expenses on medicare and medicaid cost reports has strongly influenced the arrangement of expense formats in many healthcare information systems.
Q:
it is common to group expenses by either diagnoses or procedures for purposes of planning and control.
Q:
an inflow of revenues increases equity, whereas the outflow of expenses decreases equity.
Q:
examples of general services expense include: a. insurance and payroll taxes b. laundry and dietary c. both of the above d. neither of the above
Q:
a general services expense: a. provides services necessary to maintain the patient, but the service is not directly related to patient care b. is necessary for support, but is neither directly related to patient care nor is it a service necessary to maintain the patient c. either of the above d. neither of the above