CHE Financial Management 1

Question 1

Which financial statement provides a snapshot of an organization's assets, liabilities, and equity at a specific point in time?

Accepted Answer

Balance sheet

Answer

The balance sheet (statement of financial position) reports an organization's assets, liabilities, and net assets or equity at a specific date.

Question 2

In hospital finance, 'days cash on hand' measures:

Accepted Answer

How many days an organization can operate using only its existing cash and liquid investments

Answer

Days cash on hand calculates how long an organization could sustain operations using available cash and short-term investments without any incoming revenue.

Question 3

A hospital's operating margin is calculated as:

Accepted Answer

Operating income divided by total operating revenue

Answer

Operating margin = operating income (revenue minus operating expenses) divided by total operating revenue, expressed as a percentage.

Question 4

Medicare's Diagnosis-Related Group (DRG) payment system reimburses hospitals based on:

Accepted Answer

A fixed payment per case based on the patient's diagnosis and procedure

Answer

The DRG system pays hospitals a fixed, predetermined amount per inpatient case based on the patient's diagnosis and procedure, regardless of actual costs.

Question 5

Accounts receivable days (A/R days) in healthcare indicates:

Accepted Answer

The average number of days it takes to collect payment after providing services

Answer

A/R days measures how long it takes on average to collect payment after a service is rendered — lower A/R days indicate more efficient revenue cycle performance.

CHE - Certified Healthcare Executive Practice Test

CHE - Certified Healthcare Executive Practice Test

CHE Financial Management 1