LSUS MHA 706 FINAL EXAM 2 FINANCIAL MANAGEMENT
MIDTERM Questions And Correct Answers Verified Latest
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Indirect Costs - ANSWER>>Are costs associated with shared
resources used by the entire organization
Cost Driver - ANSWER>>Is the basis on which the cost pool will
be allocated
Cost Pool - ANSWER>>Is the overhead amount to be allocated
Overhead departments - ANSWER>>Are often called costs
centers
Patient Service Departments - ANSWER>>Are often called
revenue centers
Direct Costs - ANSWER>>Are costs unique and exclusive to a
department
When you divide the "Dollars in the Cost Pool" by "Total
Volume of Cost Driver" - you have determined .... -
ANSWER>>The Allocation Rate
, Effective cost drivers should have the following characteristic(s)
- ANSWER>>-Perceived as being fair
-Promote Organizational Cost Reduction
Which of the following is NOT a type of allocation method. -
ANSWER>>step-up method
As an Accounting Manager - you are responsible for allocating
the cost of Facilities to other departments. What would be an
appropriate cost driver for you to use for this allocation. -
ANSWER>>Square footage of the department
Once a company uses the direct method to allocate indirect
costs to revenue-producing departments within the facility -
the total level of expenses decreases for the organization. -
ANSWER>>False
When using the direct cost allocation system - often you are
allocating the cost of xxxx to Patient Service Departments -
ANSWER>>Support (overhead) departments
Select all of the following options that are accounting methods
to account for "costs" at an individual service level -
ANSWER>>Activity Based Costing (ABC)
Relative Value Unit (RVU)
Time-Driven Activity Based Costing (TDABC)
Cost-to-Charge Ratio (CCR)
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