Heinke Questions Flashcards

Question

What are examples of EXTERNAL PRACTICE FORCES?

Answer 1

* Competitors * Sales market (clients) * Supplier market * Labor market * Technology * The economy * The regulatory environment

Answer 2

3 sources of competitive advantage include 1. Cost 2. Differentiation 3. innovation

Answer 3

Perceived quality of care, type of service, price levels, | and image of your practice. This perception is driven by marketing.

Answer 4

innovation is the competitive advantage a practice has when others cannot keep up with the new ideas and methodologies it has successfully implemented

Answer 5

Porter’s five forces are: 1. Threat of new entrants to the industry 2. Threat of substitutes 3. Buyer (client) power 4. Intensity of rivalry among established practices 5. Supplier power....pg 54 Heinke

Answer 6

political, | economic, sociocultural, and technological.

Answer 7

Internal.... The overriding emphasis of the value chain model is client satisfaction. evaluate what the practice team does from a value chain– strategy perspective. If employees are doing things that do not add value to the client’s experience, they should not be doing them. Your primary objective as a manager is to cause the practice to make money. By focusing on excellent service, your team drives client perception of value and willingness to pay for that value (this is called the value proposition) One management objective is to focus on what your practice does well and keep doing it well. Such effort drives quality and value, thus ensuring client satisfaction and loyalty.

Answer 8

* The primary operating activities, or those that show the progress of client and patient interaction with the practice * The support activities, or those governance or managerial activities required to sustain a well-organized and efficiently managed practice

Answer 9

``` Veterinary Practice Scorecard (VPS)..... • The patient care perspective • The client perspective • The learning and growth perspective • The financial perspective ```

Answer 10

Lapses in policy or protocol where processes have clearly lapsed....such as waiting to see the doctor after arriving, missed appointments, arriving late for appointments HEINKE pg 60 Process or protocol drift causes a weakening in the value chain.. This can be used in VPS analysis.

Answer 11

``` SMART goals are: • Specific •Measurable • Attainable • Relevant • Time-bound ```

Answer 12

1. patient perspective EX. measure time of client arrival, time of exam room admit, and time of doctor to patient. Our goal will be to have every client and patient with a technician and/or veterinarian within five minutes of arrival. 2. Client perspective EX. we will employ a three-question exit survey to determine satisfaction with appointment timeliness. 3. Employee perspective...ex... At the end of each shift, each employee will write down any issues they came across that were challenging to work through. 4. Financial perspective ex. increased revenue generated per client and increased average patient visits per year.

Answer 13

failure to communicate VISION passive management NO plan or idea or inadequate detail IN THAT plan lack of motivation and personal ownership

Answer 14

1. budgeting helps managers measure progress toward goals.... 2. Good planning and budgeting are needed to fund each part of the strategic plan

Answer 15

. Some examples are rolling budgets, rolling forecasts, flexible budgets, and event-driven budget plans. Be aware of the pros and cons of these financial tools and how they can be used in financial planning.

Answer 16

Target setting, forecasting, and resource allocation...

Answer 17

Autocratic | Democratic

Answer 18

Directive, supportive, participative, and achievement oriented

Answer 19

Managers primarily use four basic leadership styles to varying degrees: directive, supportive, participative, or achievement oriented. The directive style is task oriented. The supportive style is more concerned with people’s individual needs than with tasks. The participative style involves consulting with the group in decision making. And achievement-oriented leadership focuses on setting challenging goals.

Answer 20

self awareness, self control, self motivation, empathy, effective management of relationships

Answer 21

Dominance, inducement, submission, and compliance

Answer 22

task, people/relationship unsafe/adversarial safe/benevolent instrumented learning

Answer 23

The employee policies and guidelines manual gives employees information pertinent to their employment with the practice. The hospital operations manual presents information about how to perform duties associated with client service, animal care, facility maintenance, and other business protocols. pg 95 Heinke

Answer 24

these stages translate roughly into planning employee acquisition, hiring, conducting orientation and training, and engaging in performance evaluation....Heinke pg 102

Answer 25

the budget and the job description

Answer 26

When a past employer refuses to give negative information about a former employee even though they know that they committed violent or illegal acts under their employ

Answer 27

w-4 | state income tax withholding forms

Answer 28

w-4, state income tax withholding form, I-9, medical retirement forms, personal information including full name permanent address telephone number and phone number for person to contact in an emergency

Answer 29

I-9 is it employment eligibility verification form used to establish an employee's eligibility to legally work in the United States passport drivers license or ID card Social Security card birth certificate

Answer 30

Occupational Safety and Health Administration important personal safety training in the veterinary practice setting relates to the employees ability in handling and being around animals and maintaining good training resources about normal animal postures and body language as well as hazardous materials and ergonomic risks in the workplace are important to compliance.... according to HEINKE indoctrination and training should begin immediately for new hires and should be documented

Answer 31

Discussing age is acceptable only to know if they are the age of majority arrests and convictions are acceptable only if it relates specifically to the performance of the position for example handling controlled drugs there are no legal questions regarding marital or family status and disability has to be handled by asking how a person would perform a function as opposed to how they might be different national origin race color religion sex birthplace` discharge from the military clubs or societies or a photograph

Answer 32

At-Will Employment In most states in the United States, employment is considered to be “at-will employment.” This means that unless a specific provision in an employment contract states an agreed upon duration of employment, employees may quit and employers may terminate employees “at will,” according to their own preferences

Answer 33

• Collective bargaining agreements (labor contracts between unionized workers and employing companies) • Specific contracts that indicate a definite period of employment • Dismissals based on race, sex, color, creed, or national origin, prohibited by the Civil Rights Act • Dismissals based on age if over forty years old, prohibited by the Age Discrimination in Employment Act • Dismissal because of pregnancy, prohibited by the Pregnancy Discrimination Act • Dismissals that occur because employees refuse to work in a workplace that they consider unsafe or because they have exercised other rights under the Occupational Safety and Health Act • Dismissal of an employee because he has filed for bankruptcy, prohibited by the Bankruptcy Reform Act • Dismissal of an employee because of service on a federal jury, prohibited by federal law

Answer 34

The Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA) allows for the extension of group insurance coverage to former employees and their dependents. COBRA requires employers to cover former employees whose medical conditions would prevent them from immediately getting coverage under a new employer plan. This is done at the employees expense.

Answer 35

employers should maintain five essentially separate record-keeping systems related to its employees. These include personnel files, medical record files, equal employment opportunity data, I-9 records, and payroll and benefits data.

Answer 36

Employee personal record

Answer 37

These forms should be kept separate from other employee records for a number of reasons, including the fact the employers are not to use information on national origin in employment decisions in accord with nondiscrimination laws. Segregated record-keeping is one protection against the implication that nationality might have been a factor in any aspect of the employment cycle.

Answer 38

• Pre-employment drug screen results • Post-employment physical exam results • Family and Medical Leave Act Documentation • Return-to-work releases • Documentation of corrective-action feedback or other discussions related to performance of duties • Documentation regarding disability and/or accommodation thereof • Workers’ compensation documentation • Insurance claims documents • Physician notes (Crook n.d.)

Answer 39

Employee’s full name and Social Security number ``` • Address, including zip code • Birth date, if employee is a minor • Work schedules • Pay rates • Earnings records • Wage deductions • Benefit records • Hours worked daily and weekly • Time records for each pay period, documenting the hours the employee has worked ```

Answer 40

The Immigration Reform and Control Act (IRCA) of 1986 affects all employers regardless of size. Intended to prevent illegal aliens from obtaining employment in the United States, the IRCA requires employers to take steps to verify that a newly hired employee is eligible for employment in the United States. All employers must verify that every new hire is either a U.S. citizen or is authorized to work in this country. The IRCA applies to all employees: full-time, part-time, temporary, or seasonal. It does not apply to contract workers, so you do not need to obtain or verify information about independent contractors or their employees. 2Verification of employee eligibility is documented on U.S. Citizenship and Immigration Services (USCIS) Form I-9

Answer 41

The employer is responsible for ensuring that this attestation is properly completed by the time of hire, even though the proof-of-identity documents must be presented and examined up to three business days from the hire date.

Answer 42

no.... Every other employee is ... Even practice owners

Answer 43

The verification forms must be retained for three years from the date of hire or one year from the date of termination, whichever is longer.

Answer 44

The Fair Labor Standards Act (FLSA), passed by Congress in 1938, sets basic minimum wage and overtime pay standards and record-keeping requirements and regulates the employment of minors. The FLSA can apply to employees in one of two ways: enterprise coverage or individual coverage.

Answer 45

applies to a business if it is engaged in interstate commerce, has at least two employees, and has annual sales or business volume of at least $500,000.

Answer 46

The FLSA generally requires covered employers to pay their nonexempt employees at least the federal minimum wage and overtime premium pay of one-and-one-half times the normal rate of pay for all hours in excess of 40 in a workweek, or, in some states, it is for all hours in excess of 8 in a work day. Each workweek stands alone.

Answer 47

A workweek is defined as 7 consecutive, regularly recurring, 24-hour periods totaling 168 hours. For the first 40 hours worked in any given workweek, each employee must be paid at least the minimum wage. The overtime pay premium (1.5 times the regular rate) applies to all hours worked above 40 in a given workweek.

Answer 48

Hours an employee worked that were not expressly requested by the employer include waiting time when even when unable to use the time to do other things on call time when the employee has to stay on the premises or close to the premises, a rest period of 5 to 20 minutes training time travel time between job sites sleep time if the employee is on duty and is allowed to sleep

Answer 49

* Executive employees * Administrative employees * Professional employees * Employees engaged in outside sales * Employees doing computer-related work

Answer 50

yes....FLSA.. in a prominent place in the workplace

Answer 51

salary level, salary basis, and job duties.

Answer 52

compensation cannot be reduced because of variations in the quality or quantity of the work performed. The full salary must be paid for any week in which the employee performs any work, but need not be paid for any workweek when no work is performed. If the employee is ready, willing, and able to work, deductions may not be made for time when work is not available....

Answer 53

practice: | 1. Executive duties 2. Administrative duties 3. Professional duties

Answer 54

Other exceptions to the FLSA’s minimum wage requirements include full-time students, student learners, and disabled workers. The Wage and Hour Division of the U.S. Department of Labor issues certificates of exemption. The employer must apply for these in order to pay wages that are less than the minimum to these workers.

Answer 55

The wage and hour division of the US Department of Labor....yes and It is a violation of the FLSA to fire or in any way discriminate against an employee for filing a complaint or participating in a legal proceeding involving any of the provisions of the act.

Answer 56

no... State laws may cover this and the other following matters• Vacation, holiday, severance, or sick pay • Meal or rest periods, holidays off, or vacations • Premium pay for weekend or holiday work • A discharge notice, reason for discharge, or immediate payment of final wages to terminated employees • Any limit on the number of hours in a day or days in a week that an employee at least sixteen years old may be required or scheduled to work • Pay raises or fringe benefits

Answer 57

Here are some common errors to avoid: • Confusing federal law and state law • Assuming that all employees paid a salary are not due overtime • Improperly applying an exemption • Failing to pay for all hours an employee is “suffered or permitted” to work • Limiting the number of hours employees are allowed to record • Failing to include all pay required for calculating the regular rate of overtime • Making improper deductions from wages that cut into the required minimum wage or overtime (e.g., shortages, drive-offs, damage, tools, uniforms) • Treating an employee as an independent contractor

Answer 58

• The FLSA • The Federal Insurance Contribution Act (FICA) • The Federal Unemployment Tax Act (FUTA) • Internal Revenue Code (IRC) regulations determining income tax withholding responsibilities • IRC regulations determining the requirement for providing benefits to an individual under evolving sections of the IRC • IRC regulations determining the employer’s responsibility regarding the many other laws related to “employees”

Answer 59

The degree of control exercised by the practice over the individual’s work performance 1. control over work hours, appointments and assignments, priority of work, hourly payment arrangement). 2. The extent of the relative investments by the practice and the individual in equipment and supplies used (for example, drugs and medical supplies). 3. The individual’s opportunity for profit and loss through managerial skill (if the practice provides the opportunities and bears the risk of profit and loss, it is more likely that the individual is an employee). 4. The skill and initiative required by the work. Lower skill requirements weight toward employee status, but this does not necessarily mean that more skilled individuals, such as veterinarians, will qualify as independent contractors. 5. The permanence of the relationship. Longer work relationships imply employee status, especially when the nature of the work assignments does not vary much. 6. The extent to which the worker’s services are an integral part of the practice. They fall into three main categories: behavioral control, financial control, and relationship of the parties.

Answer 60

behavioral control exists when you can tell an employee where and when and how to do their work, an example of financial control is the employer sets an employees hours, an employee can terminate his or her relationship anytime without incurring liability but an independent contractor is usually responsible for the satisfactory completion of the job - there also might be a written contract with a contractor

Answer 61

race, color, religion, sex, or national origin

Answer 62

The Equal Employment Opportunity Commission (EEOC) was created to enforce this anti-discrimination law. 15

Answer 63

Quid pro quo sexual harassment and environmental sexual harassment that also may be called hostile environment sexual harassment

Answer 64

Anyone can do it even a vendor or a customer, the behavior must be unwelcome.

Answer 65

makes it clear that discrimination on the basis of pregnancy, childbirth, or related medical conditions constitutes unlawful sex discrimination under the Civil Rights Act. The basic principle of the act is that women affected by pregnancy and related conditions must be treated the same as other applicants and employees, on the basis of their ability or inability to work. The law applies to employers with fifteen or more employees. This means an employer must treat a pregnant employee like any other disabled employee...

Answer 66

Disability means a physical or mental impairment that substantially limits one or more of the major life activities of an individual. Imposes on employers an affirmative duty to make reasonable accommodations for applicants and employees with disabilities. 15 or more employees

Answer 67

In 1967, Congress passed the Age Discrimination in Employment Act (ADEA) to prohibit discrimination in employment because of age in such matters as hiring, job retention, compensation and other terms, conditions, and privileges of employment. The ADEA prohibits employers with twenty or more employees from discrimination against persons forty or older on the basis of their age. Employers must ensure that job announcements and employment application forms do not, in any way, attempt to discriminate against anyone on the basis of age.

Answer 68

Each eligible employee is entitled to a total of twelve workweeks of job-protected, unpaid leave during a twelvemonth period. Covers employers with fifty or more employees. To be eligible, an employee must have been employed for at least twelve months, although the months need not be consecutive. The employee must have worked at least 1,250 hours during the 12-month period immediately preceding the commencement of leave, and must work at a location where at least 50 employees are employed by the employer within a 75-mile radius.

Answer 69

The birth of a child and to care for the newborn child within one year of birth • Placement of a child with the employee for adoption or foster care, and to care for the child within one year of placement • Care for a spouse, child, or parent of the employee who has a serious health condition • Serious health condition that makes the employee unable to perform the functions of his position • Any “qualifying exigency” arising out of the active duty or call to active duty of the employee’s spouse, child, or parent... Includes anyone with a parent child relationship even if they're not related...

Answer 70

If he employed with certain "key" employees.. If a returning employee is no longer able to perform an essential function of the position upon return, the employee has no right to restoration to another position under the FMLA.

Answer 71

OSHA requires that all employers, regardless of the number of employees, shall furnish a place of employment that is free from recognized hazards that cause or are likely to cause death or serious physical harm to their employees.

Answer 72

Chemicals and noise

Answer 73

Hazzard communication plan

Answer 74

Employee training programs

Answer 75

Insurance that protects the interests of employees involved in work-related injuries. For all accidental injuries, illnesses, or deaths arising out of employment and related to employment, employers are to provide compensation, both by replacing wages and by covering the cost of all reasonable and necessary hospital, surgical, and medical expenses.

Answer 76

OSHA’s Hazard Communication Standard, which requires employers to identify all hazardous chemicals to which employees might be exposed and communicate information about them to employees. Employers must develop and put into practice a written hazard communication program that describes the procedures by which they will comply with this requirement. OSHA also requires employee-training programs on hazardous materials and ergonomic risks in the workplace.

Answer 77

workplace inspections without notifying the employer ahead of time. Inspections are usually triggered by reports of injuries in the workplace or by employee complaints of unsafe working conditions or alleged violations of OSHA standards. OSHA is authorized to give citations and impose substantial penalties for workplace violations of OSHA regulations

Answer 78

The Federal Unemployment Tax Act | (FUTA) provides funds that the states can use to administer unemployment benefits.

Answer 79

Because of this joint administration of FUTA

Answer 80

legally prescribed benefit options that exist under the law that a employer may choose to provide their employees

Answer 81

Nearly every employee health and retirement benefit arrangement is governed by the Employee Retirement Income Security Act (ERISA) of 1974, which provides safeguards for employee interests in any employer-sponsored plan. ERISA does not require that employers provide benefit plans, but it does impose requirements to protect the rights of participants.ERISA defines the fiduciary standards for covered employee benefit plans and rules of conduct for the plan trustee.

Answer 82

Title I prescribes reporting and disclosure obligations, minimum participation rules, vesting and funding requirements, fiduciary standards, and other rules. It is administered by the Department of Labor. Title II consists of amendments to the Internal Revenue Code and is enforced by the IRS. The last major section, Title IV, establishes a pension-plan benefit insurance program, administered through the Pension Benefit Guaranty Corporation (PBGC).

Answer 83

COBRA, as amended in 1989, allows for limited continuation of group health benefits to covered employees who leave their employment under certain circumstances. COBRA’s general requirement for temporary coverage extension applies to employers with twenty or more employees in the year prior to the coverage..Qualified individuals are allowed to extend their coverage (called continuation coverage) on a self-pay basis for a period up to eighteen months after termination of employment..

Answer 84

The Health Insurance Portability and Accountability Act protects workers’ healthinsurance coverage when they change jobs, limits exclusions for preexisting conditions, and prohibits discrimination against employees and dependents based on their health status.

Answer 85

The Employee Polygraph Protection Act (EPPA) of 1988 generally prohibits most private sector employers from directly or indirectly requiring, suggesting, or otherwise causing any employee or prospective employee to take or submit to any lie-detector test. Furthermore, an employer may not discharge, discipline, discriminate against, deny employment or promotion to, or threaten to take any action against any employee or prospective employee who refuses, declines, or fails to take or submit to any lie-detector test; nor may such action be taken on the basis of any lie-detector test results

Answer 86

does permit polygraph testing of some job applicants by firms that provide security services (e.g., guards and armored car services) and companies that make, distribute, or dispense pharmaceuticals. The law also permits, under certain conditions, polygraph testing of employees who are reasonably suspected of a workplace crime resulting in specific economic loss to the employer (such as embezzlement or theft). However, any testing permitted by the EPPA is subject to stringent requirements designed to safeguard the employee’s rights. Furthermore, any polygraph testing permitted by the EPPA is still subject to any applicable state and local laws and any collective bargaining agreement

Answer 87

* The Fair Labor Standards Act and Minimum Wage * Equal opportunity provisions of the law * The Family and Medical Leave Act * OSHA Job Safety and Health Protection requirements * The Employee Polygraph Protection Act * The Uniformed Services Employment and Reemployment Rights Act * Right to join/form unions and associations

Answer 88

An effective appointment schedule should have two goals: (1) to eliminate client wait time, and (2) to maximize the efficiency of the doctors, the support staff, and the facility by minimizing downtime between clients or patient procedures.

Answer 89

3 involves overlapping appointments For example, say that fifteen-minute appointments are scheduled for annual wellness care. In dense scheduling, an appointment could be scheduled every five minutes.

Answer 90

Primary use is regarding medical information and secondary is regarding practice trends like costs secondary use deals with practice wide issues and trends as opposed to an individual patients medical needs

Answer 91

doctor, client, patient, and drug names; drug strength, dosage, and expiration date; and refill information.

Answer 92

The global information-technology standard used to ensure interoperability of medical image systems is called Digital Imaging and Communications in Medicine (DICOM)Important objectives of DICOM include ensuring that all equipment is compatible with other current technology and will be compatible with future technology, regardless of vendor, and with health information systems and other developing standards. Another objective is ensuring that patient identification is imbedded with the image in a single data file, so that the two cannot be separated by mistake. Consultation

Answer 93

data is entered on the record and grouped by the information source and then ordered chronologically within these categories. For example, possible information sources include the client oral history, physical exam findings, imaging studies, and blood tests. The chronological order is determined by date of office visit or period of hospitalization (patient encounters).

Answer 94

The defined database, which includes the chief presenting complaint; the patient’s profile, history, and physical examination findings; and laboratory and radiology reports 2. The problem list, which is divided into three sections: A. the major problem list B. the minor problem list C. a medication table The plan section, which includes a written discussion of a planned course of action The progress section, SOAP

Answer 95

signaling devices. Signaling devices can be colored metal or plastic tabs attached to the record or colored stickers attached to folders. Color-coded labels reduce file retrieval time, increase filing and sorting speed, and provide a way to quickly identify misfiled records.

Answer 96

A log is a continuous record, generally kept chronologically, for one particular veterinary service or service type. .(1) They are kept to comply with legal requirements, such as those mandating that records must be kept on the use of controlled substances; (2) they provide evidence in the event of a malpractice claim; and (3) they are convenient for quick data analysis and auditing.

Answer 97

sentinel event log.

Answer 98

In human medicine, the doctrine of informed consent requires that information can be plainly conveyed so that a patient can decide on and approve a suggested course of care. In veterinary medicine, this legal doctrine is called owner consent, to differentiate the fact that animals are considered property

Answer 99

Information described in oral and written informed consent agreements includes known risks, alternatives, prognoses, possible complications, and an estimate of the fees to be charged. Discussion with the client, usually by the doctor when the condition or outcome is serious, and notes contemporaneously made in the medical record documenting the discussion, may fulfill the requirements of owner consent. Signed consent forms by traditional or electronic signature are part of the medical records and should be retained with them.

Answer 100

minimizing lost fee charges, increasing doctor productivity and service provisions, and improving patient care. Patient record evaluation also seeks to find ways to provide services more efficiently, reducing wasted time, supplies, and other costs.

Answer 101

the two greatest costs of operation are the cost of staffing and the cost of purchasing inventory

Answer 102

inventory is specifically defined as all goods owned and held for sale or use in the regular course of business The inventory of products purchased for resale to clients is commonly called merchandise inventory Items used in the course of providing veterinary medical and surgical services are called professional inventory or medical supply inventory.

Answer 103

Inventory control, for our purposes, is defined as the process whereby the need to maintain sufficient inventory to meet hospital operating demands is weighed against the monetary cost of carrying inventory

Answer 104

frequently used and needed

Answer 105

Clients can conveniently obtain refills Medications and supplies are available to treat patients Quantities of drugs and professional supplies are controlled to minimize hospital expenditures to the lowest practical level. minimize redundancy of products Employees can efficiently order, stock, and dispense the needed Appropriate security, systems, and safeguards exist employees are trained to know how to correctly handle supplies Employees are well-versed in communicating the value of products dispensed appropriate pricing is passed on to the clients of the practice. Sales achieve the planned level of profit.

Answer 106

Controlled Substances Act. Under the act, the federal government classifies controlled substances according to their potential for addiction and abuse. Laws pertaining to doctors of veterinary medicine and their conduct as registered prescribers and dispensers of controlled substances are very specific and affect veterinary hospital use and control of these drugs.

Answer 107

maintained separately from all other records

Answer 108

the FDA has responsibility for ensuring the “safety and efficacy of all regulated, marketed medical products including drugs, biologics, and medical and radiation-emitting devices. MedWatch is the FDA safety information and adverse reporting service. The FDA arm for veterinary practitioners, the Center for Veterinary Medicine (CVM), maintains a separate adverse-reaction reporting site specifically for veterinarians

Answer 109

adverse drug event (ADE).

Answer 110

pesticides

Answer 111

unit cost. This is the amount paid to the vendor, including applicable sales taxes and shipping costs, divided by the quantity of the item ordered. Ordering costs include mostly labor-related expenses.

Answer 112

ordering costs can account for as much as 15 to 20 percent of the true total cost of the item. Holding costs have to do with the costs of owning and keeping inventory on the premises in anticipation of their use. The larger holding cost is generally attributable to the capital tied up in inventory. Money paid to vendors to acquire inventory could have been alternatively invested to generate an income. Or, the money could have been used to reduce prior borrowings on which interest expense is being paid. Other holding costs are as follows: • Personal property taxes paid on the value of inventory as of a specific valuation date • Insurance premiums paid on the average inventory value to protect against the risk of loss in event of a disaster, theft, or damage • The utility and facility costs of protecting inventory against heat, cold, and humidity • Loss due to obsolescence and spoilage if inventory is not used or sold before expiration dates • Pharmacy licensing fees and regulatory compliance • Per-square-foot facility costs associated with the space used to store inventory • The cost of maintaining workplace safety programs (OSHA regulation compliance) that are attributable to inventory and supplies that are potentially dangerous to handle and store • The cost of dusting items and maintaining them with an orderly appearance

Answer 113

8 to 15 percent of the | true total cost of an item.

Answer 114

Aggregated ordering and holding costs thus account for approximately 25 to 35 percent of the total true cost, depending on the amount of time the inventory is held. Cost also depends on management’s success in safeguarding inventory from shrinkage as well as overall efficiency and effectiveness in purchasing the asset. For these many reasons, total inventory cost amounts to much more than what is paid to vendors.

Answer 115

If the orders placed are too large, you have decreased the ordering cost but increased the holding cost ....If the orders placed are too small, you have increased the ordering costs while decreasing the holding costs.

Answer 116

four basic functions—controlling, forecasting, purchasing, and selling

Answer 117

An inventory system that can provide accurate detail of inventory levels at any time is said to be a perpetual...A periodic inventory system uses records that rely on physical counts at the end of each financial period to determine the correct levels.

Answer 118

means manually counting quantities on hand A periodic inventory system uses records that rely on physical counts at the end of each financial period to determine the correct levels.

Answer 119

In this example, the variance between the calculated number and the physical count is – 9. Negative variances are expressed in the paperwork with brackets or parentheses. If there were 9 more heartworm packs on the shelf than the calculations say there should be, the variance would be +9.

Answer 120

Discrepancy | between the calculated number and the physical count is

Answer 121

Medical and hospital supplies consumed in the course of patient care or completion of office work are much more difficult to track than merchandise. By emphasizing the importance of recording what is being taken out of inventory for these daily activities (e.g., through employee training), you may be able to reduce these discrepancies.

Answer 122

segregation of inventory duties will allow for adequate safeguarding of valuable practice assets. One person should not control all aspects of record maintenance and at the same time also control all ordering, stocking, and distribution of inventory. In such a system, there are no checks and balances to prevent theft, fraud, and error. The most usual cross-check and verification occurs at the point that invoices are prepared for payment to vendors.

Answer 123

false...reorder timing should account for the estimated time delay between placing an order and receiving it. An item with a long lag time, or “lead time,” requires a higher reorder level than an item the vendor can supply almost immediately.

Answer 124

As hospital manager you should stay familiar with routine estimated usage amounts, including those of seasonal items, and monitor the use of drugs and supplies. Order supplies at the proper time to ensure timely delivery in sufficient quantities and to take optimal advantage of discount and bargain purchase options.

Answer 125

The inventory system should act as a contact management tool... The system should identify and track backorders and record when they are expected to arrive. . A good system makes cost-effective purchasing possible by identifying such factors as seasonal usage, which help you to determine optimal order times for larger quantities. An effective system also allows for identification of outdated items so they can be properly handled. In addition, an effective system ensures that vendor invoices match the contracted amounts and prices that were agreed upon when the orders were placed. Finally, the system should allow for immediate assessment of increased pricing to clients. When the vendor increases the price of an inventory item, the practice should pass the price increase on to the client.

Answer 126

expert opinion

Answer 127

Gross profit is the difference between the price of a product to the client (e.g., heartworm preventive) and the cost of the product to the practice. True....taking ordering costs, holding costs, and overhead considerations into account... This does help arrive at the most fair pricing for the client but increasingly competitive market forces at work require managers to take other factors into consideration such as a clients alternative source for products and to adapt pricing strategies to coincide with larger practice objectives....

Answer 128

mindful of seasonal influences on usage Computing and projecting quantities to order (order quantity) for the next period based on prior history relative value of various inventory items to prioritize the level of control and amount of time to be spent managing those items counting and monitoring stock meeting with reps Overseeing shipment receipt Updating sales prices of items monitoring Internet-pricing of “shopped” items and Keeping track of items that come close to their expiration dates• Ensuring that all state and federal pharmacy and physical counts of inventory, bookkeeper receives copies of all purchase orders

Answer 129

The benchmark calculation divides supply expense (the supplies used or dispensed in the financial period) by total practice revenue during the same period, typically twelve months.

Answer 130

Hospital supplies, over-the-counter items, and ancillary supply expenses such as grooming supplies average 1.5 percent. Laboratory supply and reference laboratory expenses will run at about 3.75 percent of gross income. Anesthesia, dentistry, and surgery expenses amount to about 1 percent of gross income, and dietary product averages 2.5 percent of gross income

Answer 131

Revenue centers will affect these financial ratios. For example, if the practice derives 15 percent of its total revenues from boarding services, this will cause the percentages for various supply categories to look much different (unusually lower, since boarding and grooming services generally average about 8 percent of total practice revenues).

Answer 132

One source for inventory and other financial benchmarks is AAHA’s Financial and Productivity Pulsepoints study, published every two years. For comparison with the foregoing stats, the version published in 2011 (using data from 2010) reported drugs and medical supplies (not including laboratory, dietary products, and over-the counter items) at 14.6 percent of gross revenues. Food expenses (prescription and nonprescription) averaged 3.4 percent. Laboratory expenses came in at 3.7 percent, and over-the-counter expenses totaled 2.9 percent of gross income. This book also provides percentages detailed by practice size (total revenue ranges) and by full-time equivalency veterinarians.

Answer 133

Maximum and minimum level of stock at which reordering should occur

Answer 134

For each item, the inventory manager creates a colorful tag that For example, the inventory manager determines that amoxicillin drops should be reordered when five packages remain in inventory. The fifth from the last package is tagged. Team members dispense available packages in order. When they reach the tagged package, the tag is removed and placed in a box that the inventory manager routinely monitors. When tags appear in the box, the inventory manager knows it is time to order.

Answer 135

Resorting to manual strategies, such as tagging and physical inspection, may be necessary

Answer 136

Safeguards should be instituted to reduce the temptation of theft, such as locking away the majority of available stock so only a week’s worth is readily available Ration-based inventory is based on a simple concept: When inventory is in publicly accessible and unsecured areas, such as treatment rooms, it is easier to control in smaller quantities than in larger quantities. Wastage is reduced. Theft is easier to detect by walk-about management and visual scanning of the mini-storage area.

Answer 137

purchase order is a document issued by the practice to vendors to request the delivery of materials, including supplies, any other item to be placed in inventory, equipment, and the like It specifies quantities and prices.Purchase orders can also be created when the hospital needs to purchase services, such as an equipment repair service call. A purchase order system traces every SKU from the time the practice determines that the item is needed to the point the purchase invoice is paid. Like other hospital forms, purchase orders are sequentially numbered for control purposes.After preparing the purchase order, the employee responsible for placing the order may send a copy to the vendor, fax it to the vendor, send it electronically, or call in the order and refer to the purchase order while doing soSending a purchase order to a vendor is a legal offer to purchase, but no agreement exists with the vendor until it is accepted by the vendor a copy of the purchase order will be checked against the vendor’s packing slip when the order is received.

Answer 138

A central supply under the control of one person alleviates | disorganization and lost profit

Answer 139

Strong internal controls adds accountability. two people doing separate duties may collude to commit theft, but theft is less likely to occur when two people are involved because of the fear of being discovered.

Answer 140

cost of maintaining control. Other shrinkage issues, such as the incidence of damaged items, wastage, and missed charges for items consumed obsolete items in inventory. Duplication of drugs the course of patient treatment,

Answer 141

is a profit-based management system that prioritizes inventory based on value and importance. Once the relative importance of inventory items is determined, you can develop suitable control systems and spend your time on what is most valuable to the practice.

Answer 142

The 80/20 rule, as applied to inventory, says that 20 percent of the items account for about 80 percent of the sales revenues. It also states that about 80 percent of the inventory cost exists in 20 percent of the inventory items. Third, 80 percent of profit can be predicted to come from 20 percent of products sold. These groups likely overlap, but they are not necessarily the same. It is helpful to know which items account for your practice’s top 20 percent of total revenues, total cost, and total profit.

Answer 143

20 percent of the items carried in stock typically account for 80 percent of your inventory investment, you should plan to spend more of your time managing these items, ABC analysis is a method of sorting inventory into manageable components based on cost and relative value.

Answer 144

Calculate the annual usage distribution.sort the SKUs in descending order by AUV

Answer 145

(AUV) acheived by multiplying volume used in a year by the | average cost.

Answer 146

``` Controlled substances » Highest risk / highest priority » Tightest controls » Frequent review and inspection (perhaps even daily) by a responsible doctor or chief of staff ```

Answer 147

High value / high priority » Tight controls » Complete, accurate records » Records updated in practice management system as stock is received » Frequent and regular review by manager » Frequent review and adjustment of demand forecasts » Regular comparisons of physical stock to forecasts » Minimize stocks on hand and reduce lead time » Good security of surplus stock, when surplus is unavoidable

Answer 148

» Medium priority | » Normal control

Answer 149

» Lowest priority » Simplest possible control » Weigh cost-benefit relationship of micromanagement and stock savings » Consider ordering larger quantities with bigger safety stock margins, if warranted

Answer 150

* Forecast demand for the next month, quarter, or year, including seasonal trends * Determine acquisition lead time * Plan usage during the lead time period * Establish and monitor quantity on hand * Determine reserve or safety stock requirements (Usry and Hammer 1991)

Answer 151

The inventory amount of an item that is expected to be used up between the point of order receipt and the time another order must be placed.

Answer 152

Lead time: The time between the point of order and when shipment will be received.The lead-time quantity should assure that at least one item will still be available when the new order is received.

Answer 153

The time at which the purchasing manager should place a restock order with the vendor because supplies have fallen to a specified level. Reorder point is determined by the SKU quantity that will meet predicted normal operating needs until the restocking supplies arrive on the premises (lead time) plus the selected emergency stock quantity (safety stock). The reorder point quantity equals the safety stock plus the lead-time quantity.

Answer 154

The lead-time quantity is the amount of inventory expected to be used up from the time the order is placed until the order is received.The lead-time quantity should assure that at least one item will still be available when the new order is received.

Answer 155

Safety stock: A desired inventory cushion, in excess of lead-time quantity, to help mitigate the event of a stock outage if shipment was delayed or if the item was placed on back order.

Answer 156

Inventory turnover: A computation that relates the volume of merchandise sold to the inventory amount. You can compute turnover to determine whether inventory items have the desired “shelf-life” or are sitting around too long and eating into profitability.

Answer 157

Operating level: The inventory amount of an item that is expected to be used up between the point of order receipt and the time another order must be placed.

Answer 158

The reorder point quantity equals the safety stock plus the | lead-time quantity.

Answer 159

This is the sum of the beginning inventory (BI) and the ending inventory (EI) divided by 2.The result is the average onhand inventory (AI) and is intended to approximate the average cost of inventory on hand at any given time:

Answer 160

Divide the total purchases during the year (DMSP) by the average on-hand inventory value, as calculated in the first step. DMSP ÷ AI = Inventory Turnover Ratio The resulting inventory turnover ratio tells you how many times the entire inventory of drugs and medical supplies has been sold and replaced over a single year.

Answer 161

eoq= Sq root of 2xAxF/HxUC A = Annual demand in units F = Fixed ordering costs incurred per order H = Holding costs expressed on an annual basis as a percentage of unit cost UC = Unit cost to purchase from vendor or supplier OTHER

Answer 162

meaning that on average, | you can estimate that the full order will be sold in 60 days)

Answer 163

sale occurs at the vendor’s shipping dock,

Answer 164

Two common methods of pricing include markup and margin pricing.

Answer 165

Markup pricing entails multiplying acquisition cost by a factor. With the markup method, a 100 percent markup on cost doubles the price for which the product was obtained from the vendor. A 200 percent markup triples the unit cost, and a 300 percent markup quadruples the unit cost to arrive at retail price. To determine the markup on an item, you must consider market competition and constraints as well as cost and practice philosophy. Product markups can easily range from a low of 40 percent to a high of 400 percent. 40% is too close to break even

Answer 166

Margin pricing determines the amount of profit desired for a given product line, and adding it to the cost of obtaining it from the supplier.With margin pricing, the price of a particular medication will increase much more gradually for the size of the patient as compared to a straight multiplier effect with the mark up method

Answer 167

break-even point (BEP)

Answer 168

SP = FC + VC + P where SP = sales price FC = fixed cost cc =variable cost and P = profit

Answer 169

The common amount of practice profit margin to add in pricing a product

Answer 170

travel sheet data collection sheet circle sheet

Answer 171

negotiable instrument There are two types of negotiable instruments, notes and drafts; a check is a draft.

Answer 172

A cashier’s check is a demand draft drawn on the bank itself, rather than the client’s account. After a cashier’s check has been given to the hospital in payment, the client cannot stop payment on the check ...A certified check is a draft that has been pre-accepted by the payer’s bank. By certifying the check, the bank assumes responsibility for payment and sets aside funds from the client’s account to cover the check

Answer 173

The privity of contract, or legal relationship, exists | between the insurance company and the insured party, the animal owner.

Answer 174

The daily drawer closeout procedure compares the counted revenues with the receipt record the cashier must verify evidence of reconciliation for each revenue type: cash, credit card, checks, and coupons.

Answer 175

Internal control includes “all measures used by a business to ensure against errors, waste, and fraud; to assure the reliability of accounting data; and to promote compliance with all company policies”

Answer 176

false....no ONE...person

Answer 177

asset custody

Answer 178

divide duties, The person who reconciles the bank statement should not control the deposit or take it to the bank or process client credit cards. The person who reviews the daily records and cross-checks deposit amounts with invoices and computer-system reports should not make the collections or prepare the deposit. The person who adjusts client accounts receivables for write-offs should not handle payments made on account by the client.

Answer 179

Bookkeeping is the process of recording business data in a prescribed manner. The bookkeeper’s duties basically involve recording the transactions into the journals and ledgers.

Answer 180

If the bookkeeper has access to and handles bank deposits, then a significant principle of strong internal control function, segregation of duties, has been violated. The chief objective of establishing and maintaining appropriate segregation of employee duties is to ensure that no employee has the opportunity to both commit a fraudulent activity and also conceal that fraud

Answer 181

* Authorization * Recording * Custody

Answer 182

Authorization duties entail the ability to approve transactions. Recording refers to the actual data entry process, Custody duties involve the physical handling of assets.

Answer 183

In the top-down approach, the desired gross | income of the practice is projected to the desired target amount.

Answer 184

In the bottom-up | approach, the desired level of profit is established at the outset

Answer 185

Compilation Review Audit...

Answer 186

A CPA, an attorney, or an enrolled agent (EA).

Answer 187

Many of the service offerings CPA firms provide are collectively called compliance work and involve taxation issues and taxpayer reporting requirements.

Answer 188

The general ledger is the principal ledger that contains all of the financial information summarized in the subsidiary ledgers. It is organized chronologically within each of the applicable accounts listed in the practice’s chart of accounts. The bookkeeperprepared general ledger provides the accounting firm with the information it needs to execute its responsibilities to the veterinary practice.

Answer 189

The backbone of any accounting system is the chart of accounts (COA), an organized listing of all of the income, expense, asset, liability, and equity categories used in a business entity for classifying each and every transaction as it occurs. Usually a numeric code is associated with each account name. The account codes allow for daily financial transactions to be coded accurately and consistently, ultimately resulting in reports and financial statements that provide a clear picture of the practice operations. AAHA Chart of Accounts is flexible enough for use in all practices, regardless of size, bookkeeping competency,Attention to detail such as posting dates, vendor names, and amounts are other important factors in enhancing the reliability of reports. A chart of accounts that is handled correctly provides the best basis for planning and making prudent business decisions. 435 VetBooks

Answer 190

monetary records based on the cost to acquire properties and services....The exchange price

Answer 191

Assets = Liabilities + Owner’s Equity

Answer 192

Assets represent all of the economic resources of the practice that can be expressed in monetary terms, meaning anything the practice owns.

Answer 193

• Liabilities are legally enforceable obligations resulting from past transactions that require the practice to pay money, provide goods, or perform services in the future.

Answer 194

Owner’s equity represents the interest or claim of the practice owners in the practice assets. Owner’s equity is what the practice owes its owners, according to the practice books: the amounts the owners have invested in the business plus the amount of profits that have been retained in the business and that are owed to the owners, less any amounts that have been withdrawn as dividends or draws.

Answer 195

Total financial claims to the properties or assets of the veterinary practice are referred to as equities.Assets = Equities meaning assets are things of value equal the sum total of the owners claim to property and someone elses claim to the property ,a liability, comes first because in theory they have the first right

Answer 196

Balance sheet Income statement Cash flow statement Statement of stockholders’ equity

Answer 197

On any given date the balance sheet is prepared, asset, liability, and owner’s equity accounts will all be in balance: assets = liabilities + owner’s equityThe balance sheet always reports account balances at a specific date. This can be any date, but the most common for formal reporting is at month’s end, quarter’s end, or year’s end..

Answer 198

Income statement: Sometimes called the statement of operations, the profit and loss statement, or the statement of revenues and expenses, the income statement reports values that have accumulated between two points in time. This report measures the performance of the practice by comparing the revenue generated with related expenses incurred for a particular period.

Answer 199

Cash flow statement: This financial statement summates accumulated inflows and outflows of cash between two points in time, depending on sources and uses of cash. This statement differs from an income statement because not all cash inflow results from revenue collection and not all cash outflow is used for paying operating expenses

Answer 200

Statement of stockholders’ equity: This statement is similar to the statement of owner’s equity, the statement of retained earnings, or the statement of partners’ capital, depending on the practice’s legal and/or tax entity structure, and reconciles beginning and ending owner equity accounts for a given period.

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