Free AHM-520 Mock Exam – Practice Online Confidently

In the following paragraph, a sentence contains two pairs of words enclosed in parentheses. Determine which word in each pair correctly completes the sentence. Then select the answer choice containing the two words that you have selected.Budgeting approaches can be classified as static or flexible budgets, or as rolling or period budgets. A health plan most likely would use a (static / flexible) budget when a budget's objective is to reduce or limit expenses, and the health plan most likely would use a (rolling / period) budget if it would like to continually maintain projections for a certain time period into the future.

The Jasmine Company, which self-funds the health plan for its 200 employees, has established a 501(c)(9) trust as a means of addressing possible claims fluctuations under the health plan. This plan is not a part of a collective bargaining process.A potential disadvantage to Jasmine of using a 501(c)(9) trust is that:

Under GAAP, three approaches to expense recognition are generally allowed: associating cause and effect, systematic and rational allocation, and immediate recognition.

A health plan most likely would use the approach of systematic and rational allocation in order to:

The following statements are about 501(c)(9) trusts. Select the answer choice containing the correct statement:

The Fairway health plan is a for-profit health plan that issues stock. The following data was taken from Fairway's financial statements:Current assets.....$5,000,000 -Total assets.....$6,000,000 -Current liabilities.....$2,500,000Total liabilities.....$3,600,000Stockholders' equity.....$2,400,000Fairway's total revenues for the previous financial period were $7,200,000, and its net income for that period was $180,000.Assume that the healthcare industry average for the debt-to-equity ratio is 0.90.The following statement(s) can correctly be made about Fairway's debt to equity ratio: