REVIEW QUESTIONS AND PROBLEMS 247 4. Working capital management strategy. Describe the two components of a working capital management strategy. 5. Asset mix strategies. Compare aggressive and conservative asset mix strategies. The compari- son should address goals, liquidity, and risk. 6. Borrowing. What is the difference between temporary and permanent working capital needs What is the general rule about when to borrow long term or short term? 7. Borrowing. In terms of risk and return (profit), compare the advantages and disadvantages both short- and long-term borrowing to meet working capital needs. 8. Cash. State the three reasons why a health care facility holds cash. 9. Cash. What are the main sources of temporary cash? 10. Loans. What is an unsecured loan? 11. Loans. What are the two types of unsecured bank loans? Describe each one. 12. Compensating balance. How do compensating balances affect the "true" interest rate the rower pays? 13. Discounts. What does "1.5/15 net 25" mean? 14. Discounts. What is the formula to determine the approximate annual interest cost for not a discount? When should discounts be taken? 15. Revenue cycle management. What are the objectives of billing, credit, and collections p 16. Revenue cycle management. Why is preregistration important in the revenue cycle ment process? 7. Revenue cycle management. What is the major obstacle that health care providers f ceiving their payments electronically? 3. Revenue cycle management. Identify two problems that can delay the billing proce . Billing. the hospital's billing process, why is Medical Records a critical department - Revenue cycle management. As more health care costs are shifted to the patient th deductible health plans, what policy can a health care provider implement to ensure ment for elective surgery procedures? Lockboxes. Describe the lockbox technique for managing collection float. Revenue cycle management. What is the critical step in capturing charges and ic ing items? Investments. Identify the alternatives for investing cash on a short-term basis, a tivo

what is the general rule about when to borrow long term or short term