question

Financial records that are complete, correct, and current are essential for what??

answer

-prompt billing and collection procedures -accurate budgeting -professional financial planning -accurate reporting of incoome to federal and state agencies

question

Define Accounting??

answer

a system of recording, classifying, and summarizing financial transactions

question

Define Bookkeeping??

answer

is the recording part of the accounting process

question

Which two general bases, or methods, of accounting are used??

answer

cash basis and the accrual basis

question

Which method most physicians use in accounting bases??

answer

cash basis of accounting.

question

What is Cash basis of accounting??

answer

charges for services are entered as income when payment is received, and expenses are recorded when they are paid

question

What is Accrual basis of accounting??

answer

method of acconting in which income is recorded when earned and expenses are recorded when incurred

question

The financial records of any business should show the following at all times??

answer

-how much was earned in a given period -how much was collected -how much is owed -the distribution of expenses incurred

question

Periodic analyses of financial records result in what??

answer

-improved business practices, better time mgmt, curtailment or elimination of unprofitable services, and better budgeting of expenses

question

Whats the rule of bookkeeping??

answer

- first, use good penmanship so that the records are clearly legible, even yrs later -use the same pen style and type of ink consistently -keep columns of figures straight and write well-formed figures

question

When should the MA used the petty cash fund??

answer

to pay for small, unpredictable expenses

question

What are the don'ts in bookkeeping?

answer

do not erase, write over, or blot out figures

question

What is a daily journal??

answer

the chronologic record of the practice (e.g. the financial dairy)

question

Whats the day sheet used for?/

answer

for practices that use a manual pegboard system

question

What should the disbursement journal must show??

answer

-every amount paid out -date and check number -purpose of the payment

question

What are sum examples for petty cash and voucher system should be used??

answer

for postage due, parking fees, small contributions, emergency supplies, and miscellaneous small items

question

What is a single-entry system ??

answer

very basis and usually is used in small business, such as a one-physician office or a partnership that sees a relatively small number of pts

question

Whats are sum advantages of single-entry system??

answer

inexpensive, easy to use, and require little training

question

What are the required three basis records for single-entry system??

answer

-general journal -cash payment journal -accounts receivable ledger

question

What is the general journal??

answer

is a record (a day sheet) where transactions are entered

question

What is the cash payment journal??

answer

in its simplest form is a record ( a checkbook) that is used to make payments

question

What is the accounts receivable ledger??

answer

provides info about the amount owed the physician

question

What are sum advantages of double-entry bookkeeping??

answer

inexpensive, but requires a trained, experienced bookkeeper or the regular services of an accountant

question

How is double-entry bookkeeping??

answer

the transactions may be recorded manually or by computer, every transations requires an entry on each side of the accounting equation and both sides must be balance

question

What is Assets??

answer

the properties owned by a business, such as bank accounts, accounts receivable, buildings, equipment, and furniture

question

What are the rt to assets??

answer

equities

question

What is the equity of the owner called??

answer

capital, proprietorship, or owner's equity

question

The equities of the creditors to whom money is owed are called??

answer

liabilities

question

Double-entry bookkeeping is not frequently used where??

answer

small practice

question

What are the parts for the end of day summary??

answer

-First part is the proof of posting section, which deals with the transaction that occurred that day on the day sheet -Second section is the month-to-date accounts receivable proof; adding the days totals to the MTD totals should be balance -Last section is the year-to-date accounts receivable proof; which adds the accounts, including the day's totals, to the YTD

question

If the end of the day summarizing does not balance, what should the MA do next??

answer

check the addition of each column, both horizontally and vertically; in most cases this reveals the error

question

When should the Trial balance be done??

answer

once a month after all posting has been completed and before the monthly statements are prepared

question

What is the purpose of a Trail balance??

answer

to disclose any discrepancies btwn the journey and the ledger. it does not prove the accuracy of the accounts

question

What is the first step in locating an error in the trial balance??

answer

find the difference btwn the two totals, then search the daily journal pages and account cards

question

When does the vender includes a packing slip?/

answer

if an item is not paid for at the time of purchase,

question

What is a packing slip??

answer

it describes the items enclosed

question

What is a invoice??

answer

it describes the items and shows the amount due

question

What is the statment??

answer

a request for payment

question

What are the steps when paying for purchases?/

answer

at the time of payment, compare the statement with the invoice to verify its accuracy, fasten the statement and invoice together, write the datem the amount paid, and the check number on the statement, and place it in the paid file

question

What is a disbursement??

answer

funds paid out

question

Describe Business expenses??

answer

are tax deductible and are considered in determining net income from the practice

question

Describe Personal expenses?/

answer

are not deductible in determining net income from the practice, some qualify as computing personal income tax

question

What would deductible expenses include??

answer

property taxes, interest paid out, contributions

question

A accounting for petty cash is what??

answer

revolving fund

question

Petty cash can be used for a variety of items such as??

answer

expendable supplies, business meals, local transportation, photocopy service

question

How to establish the petty cash??

answer

a check is written payable to cash or petty cash and entered in the disbursements journal under Miscellaneous

question

If the physician requests cash from the fund, what should the MA request?/

answer

a personal check or an office check in exchange for cash from the fund when it is time to replenish the money

question

What is the Statement of income and expense also known as, and what does it list??

answer

profit and loss statement, it list all the income received and all expenses paid during the period

question

The total income is called what??

answer

gross income or earnings

question

What is the net income?

answer

income after deduction of all expenses

question

A cash flow statement is what??

answer

the amount of cash on hand at the beginning of the month ( or for any specified period)

question

The balance sheet is also known as what?

answer

statement of financial condition

question

What does the government regulations requires??

answer

the withholding of taxes from employees and payment of certain taxes by both employees and employers

question

How long all records of employment taxes must be kept??

answer

at least four years

question

What are the records that should be kept for review by the IRS??

answer

-SSN -number of withholding allowances claimed -amount of gross salary -all deductions for Social Security and Medicare taxes

question

What is the employee's tax identification number??

answer

Social Security number

question

Which form is used to apply for a SSN??

answer

SS-5

question

Which form is used when a employer applies for a number for federal tax accounting purposes??

answer

SS-4

question

At the end of the first pay period, the employee should complete an employee's withholding allowance certificate form??

answer

W-4

question

If too little tax is taken out during the year, the employee may owe what??

answer

a significant amount of money to the IRS the following yr

question

The amount to be withheld is based on what?

answer

-Total earnings of the employee -number of withholding allowances claimed -marital status of the employee -length of the pay period involved

question

A physician practicing as an individual is not subject to ______but is expected to make a estimated tax payment _______a year??

answer

withholding tax, four times

question

All wages are subject to the Medicare tax at a rate of ____ ??

answer

1.45%

question

Employers must file form _____, the transmittal of income and tax statement, annually to transmit wage and income tax withhels statements to the social security administration??

answer

W-3

question

An annual Federal Unemployment Act (FUTA) return must be filed on what form??

answer

940

Chap 24 – Flashcard

Unlock all answers in this set

Haven't found what you were looking for?

Search for samples, answers to your questions and flashcards