Interesting Quiz On Budgets
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Take this interesting quiz and find out how much do you know about budgets?
- 1.Budgeting is the
- A.
process of converting the operating plan into monetary terms
- B.
process of converting the strategic plan into monetary terms
- C.
link between the strategic plan and the operating plan
- D.
prediction of revenues and expenses for the following fiscal year
- 2.Which of the following is(are) a prerequisite to budgeting?
- A.
The budget manual needs to contain strategic planning information.
- B.
Revenue, expense, and volume data from the previous year have to be gathered.
- C.
The organization must have a comprehensive management information system.
- D.
All of the above
- 3.Which of the following is an advantage to budgeting?
- A.
Budgeting helps managers exert control.
- B.
Budgeting is an easy way for superiors to measure subordinates' performance.
- C.
The budgeting process presents an opportunity for financial staff to educate nonfinancial staff.
- D.
All of the above
- 4.Why are fixed budgets unreasonable for healthcare organizations?
- A.
Fixed budgets do not take unexpected purchases into account.
- B.
Healthcare organizations’ volumes fluctuate throughout the year.
- C.
Fixed budgets do not consider contractual allowances.
- D.
Healthcare organizations’ fixed costs fluctuate throughout the year.
- 5.What is an advantage to comprehensive budgeting?
- A.
Managers can view budgets over a span of several years.
- B.
Managers get a general overview of the budget.
- C.
All budgets are consolidated into one document.
- D.
All budgeted items are itemized.
- 6.What is the first step in the budgeting process?
- A.
Project volumes
- B.
Determine expenses
- C.
Determine revenues
- D.
Project contractual allowances
- 7.Department managers use __________ to determine volumes.
- A.
RVUs
- B.
Charity care policies
- C.
Production units
- D.
Historical data
- 8.How are production units used?
- A.
To project volumes
- B.
To calculate the cost per procedure
- C.
To anticipate the number of charity care cases
- D.
(a) and (b)
- 9.What technique do managers use to project volumes under conditions of uncertainty?
- A.
OT analysis
- B.
Historical analysis
- C.
Forecasting
- D.
Production units
- 10.What is cost-led pricing?
- A.
Revenue budgets are set before expense budgets.
- B.
Expense budgets are set before revenue budgets.
- C.
Revenue budgets need to be determined before capital budgeting can occur.
- D.
Expense budgets need to be determined before capital budgeting can occur.
- 11.Which of the following does management take into account when determining expenses?
- A.
Supplies
- B.
Overhead costs
- C.
Labor
- D.
All of the above
- 12.How can managers best reduce benefit expenses?
- A.
Employ part-time or temporary workers
- B.
Lay off staff members
- C.
Reduce the amount of benefits offered
- D.
Employ more full-time employees
- 13.How can managers best reduce benefit expenses?
- A.
Employ part-time or temporary workers
- B.
Lay off staff members
- C.
Reduce the amount of benefits offered
- D.
Employ more full-time employees
- 14.What is a department manager’s objective in reviewing the department’s staffing mix?
- A.
Train as many staff members in new skills as possible
- B.
Cross-train staff members on multiple competencies
- C.
Match job tasks to job positions in the most cost-effective manner
- D.
Ensure each staff member receives appropriate pay and benefits
- 15.How are merit raises usually given?
- A.
As part of a performance appraisal
- B.
As part of an employment anniversary
- C.
As a bonus
- D.
(a) and (b)
- 16.What is the most common method of evaluating budget performance?
- A.
Net income analysis
- B.
Variance analysis
- C.
Expense variance analysis
- D.
Revenue variance analysis
- 17.What does variance analysis tell management?
- A.
The difference between actual revenues and expenses and budgeted revenues and expenses
- B.
The difference between revenues and expenses for a given period
- C.
The impact unexpected expenses have had on the budget
- D.
Aspects of budgeting that the organization can improve on
- 18.For expense variance, _______________ variances are faborable and ___________ variances are unfavorable.
- A.
positive; negative
- B.
no; negative
- C.
Negative; positive
- D.
negative; no
- 19.What is the most important component of budget development?
- A.
Revenues
- B.
Variable expenses
- C.
Projected volumes
- D.
Contractual allowances
- 20.Calculate projected expenses per RVU: Projected labor expense = $18 + 4% Projected supply expense = $14.75 + 5% Projected overhead expense = $31 + 1%
- A.
63.27
- B.
64.32
- C.
$ 65.52
- D.
None of the above.
- 21.Which one do you like?
- A.
Option 1
- B.
Option 2
- C.
Option 3
- D.
Option 4
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