Financial Management Flashcards
6 cards from real FMP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Financial Management flashcards as text
What is the primary benefit of activity-based costing in facility management?
Answer: It allocates costs more accurately by linking expenses to specific activities and services
ABC traces costs to specific facility activities, providing more accurate allocation than traditional methods.
How should a facility manager present a business case for an energy retrofit project?
Answer: Present financial return through energy savings, utility rebates, and lifecycle cost analysis alongside non-financial benefits
A compelling business case combines financial analysis with non-financial benefits.
What is chargeback in facility financial management?
Answer: Allocating facility costs to individual departments or tenants based on their usage
Chargeback allocates facility costs to users based on proportional use of space and services.
What financial tool helps evaluate whether to outsource a service or keep it in-house?
Answer: A total cost comparison including direct costs, overhead, quality impact, and risk assessment
The decision requires comprehensive analysis of all costs, quality implications, and risks.
What is the purpose of a financial audit of facility operations?
Answer: To verify that financial practices are accurate, compliant, and aligned with organizational policies
Audits verify accuracy and compliance, identify control weaknesses, and provide assurance of responsible management.
How does depreciation affect facility financial planning?
Answer: Depreciation systematically allocates asset costs over their useful life, affecting financial statements and replacement planning
Depreciation allocates capital costs over asset useful life, affecting statements, taxes, and replacement timing.