Chapter 11 vocab

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SummerXParadise
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246939
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Chapter 11 vocab
Updated:
2013-11-14 17:17:09
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Finance budget
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For final 352
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  1. Accountability
    The extent to which there are consequences attached to carrying out responsibilities
  2. Responsibility
    Duties and obligations of responsibility center
  3. Budget Variance
    The difference between what was planned (budgeted) and what was achieved (actual)
  4. Flexible Budget
    A budget that accommodates a range or multiple levels of activities
  5. Revenue Rate Variance
    The difference between the revenues forecast in the flexible budget and those actually earned
  6. Revenue volume variance
    The difference between the revenues forecast in the original budget and those in the flexible budget
  7. Expense volume variance
    Difference between the expenses forecast in the original budget and those in the flexible budget
  8. Expense Cost Variance
    Difference between the variable expenses forecast in the flexible budget and those actually incurred
  9. Cost Containment
    Not spending more than is budgeted in the expense budget
  10. Investment centers
    Organizational units that have all the responsibilities of a traditional profit center and are responsible for return on investment
  11. Revenue Attainment
    Earning the amount of revenue budget
  12. Cost Avoidance
    Finding new ways to run a business that eliminate certain classes of costs
  13. Revenue Enhancement
    Finding supplemental sources of revenue
  14. Administrative Cost Centers
    Support clinical cost centers and the organization as a whole

    Often considered the infrastructure of the organization
  15. Clinical cost centers
    Cost centers that are responsible for providing health care related services to clients, patients, or enrollees
  16. Production cost centers
    Cost centers that are responsible for producing or selling products (or both)
  17. Cost Center
    Most common type of responsibility center

    Responsibility for providing services and controlling their costs
  18. Capitated profit centers
    Responsible for earning a profit by agreeing to take care of defined health care needs of a population for a per member fee

    example: HMO's
  19. Traditional Profit centers
    Responsible for earning a profit by providing health care services (selling goods or services)

    Example: women's and children's services
  20. Service Centers
    Most basic type of responsibility center

    Primary responsible for ensuring that services are provided to a population in a manner that meets the volume and quality requirements of the organization
  21. Responsibility Center
    An organization unit that has been formally given the responsibility to carry out one or more tasks, to achieve one or more outcomes, or both
  22. Profit Centers
    Responsible for controlling costs and earning revenues
  23. Decentralization
    The degree of dispersion of responsibility within a health care organization
  24. Transfer Prices
    Prices for products or services that are charged internally to other organizational units
  25. Administrative Profit Centers
    Do not provide health care related services but are responsible for their profit

    Two types: Those who sell their services internally and those whose primary responsibility is to bring revenues into the organization
  26. Authority
    Power to carry out a given responsibility

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