Chapter 5

Question 1

Charity Care

Answer 1

Service that is never expected to result in cash flow

Question 2

Indigent

Answer 2

person who has no means to pay for services and eligible for public assistance

Question 3

Bad Debt

Answer 3

uncollectible account resulting from the extension of credit

Question 4

GAAP

Answer 4

Generally Accepted Accounting Principles

Question 5

ADR

Answer 5

Average Daily Revenue

Question 6

ADRR

Answer 6

Average Days of Revenue in Account Receivable

Question 7

Statue of Limitations

Answer 7

amount of time a claim must be collected on before it is deemed paid

Question 8

bankruptcy Chapter 7

Answer 8

individuals or businesses that can not pay their debt. 70 % of all bankruptcy claims are filed under Chapter 7

Question 9

bankruptcy Chapter 11

Answer 9

reorganization. This give distressed business a reprieve from creditors while the company continues to function and will work out a repayment plan. Most chapter 11 cases will end up as a chapter 7

Question 10

Involuntary bankruptcy

Answer 10

debtor can be placed into bankruptcy if they meet the following guidelines * 12 or more creditors, 3 who exceed $5000 each and willing to force the issue.
* Fewer than 12 creditors, 1 with at least $10,775

Question 11

Chapter 12 bankruptcy

Answer 11

Farmers with a regular annual income needing relief

Question 12

Chapter 13 Bankruptcy

Answer 12

debtors with a regular income who desire to pay their debts. Repayment plan is created under court supervision * installments can extend of 3 to 5 years

Question 13

Discharge of Debtor

Answer 13

releases the guarantor from any responsibility of all balance. The balances will be written off

Question 14

Dismissal

Answer 14

Court ruling where your bankruptcy has been rejected by the court

Question 15

Judgement

Answer 15

a legal right to collect a debt that can be used to obtain a lien

Question 16

Lien

Answer 16

a claim against real or personal property, If the property is sold the creditor must be paid out of the proceeds

Question 17

Tort Liability

Answer 17

liability for an injury or wrongdoing by one person to another resulting from a breach of legal duty

Question 18

Mini Miranda

Answer 18

” this is an attempt to collect a debt and any information obtained will be used for that purpose”

Question 19

Intentional Skip

Answer 19

Someone who avoids paying bills by purposely changing their demographics and failing to report the change or giving false information

Question 20

Unintentional Skip

Answer 20

Someone who moves and has a forwarding address available but failed to notify the creditor

Question 21

False Skip

Answer 21

skip created by a clerical error at the time of registration