Facts checked against aonl.org and psionlinestore.com · Last checked Nov 6, 2026 · Not affiliated with ANCC, ANA, AONL, NLN or AACN.
Business skills and principles covers the money, the plan and the people from the unit manager's chair. Expect census arithmetic with a calculator, budget and variance scenarios, strategy turned into unit objectives, contracts, and the hiring-to-retention cycle.
A. Financial management: the organization's financial processes, reimbursement models, building, managing and monitoring the unit budget, adjusting it for variances.
B. Strategic management: high reliability concepts for staff, evidence in goal setting, unit objectives tied to strategy, contracts and service agreements, technology, outcome metrics.
C. Human resource management: a diverse workforce sized to need, recruitment through recognition under employment law, a healthy work environment, practice at the top of license, mentoring.
15 budget, strategy and staffing questions
Question 1 of 15 · Business Skills and Principles · 18%
A charge nurse with strong clinical skills tells the nurse manager of a hope to become a unit manager within three years. Which response BEST supports the nurse's career progression?
A development plan with a leadership mentor and stretch assignments builds the competencies a manager role needs and keeps the nurse engaged while growing toward it.
Limiting the nurse to clinical work ignores the stated goal and withholds the experience needed to become a manager.
Waiting for a posting wastes three years that could build leadership skills, leaving the nurse unprepared to apply.
Promising a future position is a commitment the manager cannot ethically make before a fair selection process.
Question 2 of 15 · Business Skills and Principles · 18%
A nurse returning from parental leave asks for time during 12-hour shifts to express breast milk. Under federal law (the FLSA as amended by the PUMP Act), the nurse manager should:
Restricting pumping to the meal break ignores the requirement for reasonable break time each time the employee needs to express milk.
A bathroom is expressly excluded as the private space, so offering the restroom fails the law even if it is convenient.
The FLSA, as amended by the PUMP Act, requires reasonable break time and a private space shielded from view that is not a bathroom, for up to one year after the child's birth.
Lactation breaks are a separate right under the FLSA; requiring intermittent FMLA leave confuses two different statutes.
Question 3 of 15 · Business Skills and Principles · 18%
The hospital is drafting a new contract with a patient transport vendor, and the nurse manager is asked for input. Which contribution BEST protects the unit's operations under the contract?
A verbal agreement is unenforceable in practice and leaves no written service levels to measure against.
Having unit staff supervise the vendor's employees blurs the contractor relationship; the contract should set outcomes, not hand supervision to the unit.
Chasing the lowest price regardless of terms leaves no performance standard, so delays would have no contractual consequence.
Measurable response-time standards with remedies give the hospital a way to monitor the vendor and enforce performance that affects patient flow.
Question 4 of 15 · Business Skills and Principles · 18%
The unit's SWOT analysis lists a certified wound-care nursing team as a strength and a growing local population of older adults with diabetes as an opportunity. A TOWS strategy that uses the strength to capture the opportunity would be to:
Defending against a competitor is a strength-threat strategy, which responds to a threat rather than an opportunity.
A TOWS strength-opportunity strategy uses an internal strength to capture an external opportunity, here a wound clinic for the growing population of older adults with diabetes.
Cutting services to limit risk is a defensive weakness-threat move that abandons both the strength and the opportunity.
Recruiting to fix a weakness is a weakness-focused strategy, and the stem names wound care as a strength, not a weakness.
Question 5 of 15 · Business Skills and Principles · 18%
Staff report that the unit's patient classification system consistently underestimates the care needs of post-operative patients, so recommended staffing is too low. The nurse manager should:
Rating every patient at the highest level corrupts the data and inflates staffing everywhere instead of fixing the tool.
Abandoning the tool for shift-by-shift requests replaces an objective workload measure with negotiation and preference.
A tool validated at purchase can drift as patient populations and practice change, so initial validation does not settle the question.
When a classification tool consistently underestimates care needs, the response is to validate it, including interrater reliability, so recommended staffing reflects actual workload.
Question 6 of 15 · Business Skills and Principles · 18%
The unit's monthly report shows unfavorable variances in several expense lines. Which variance is the nurse manager MOST directly accountable for managing?
Hospital-wide malpractice insurance is purchased centrally and allocated, so it is not a unit-controllable expense.
Overtime scheduled on the unit is a controllable cost under the manager's direct influence, so it is the variance the manager is accountable for managing.
Allocated IT costs are distributed to units by formula; the manager cannot change them through unit decisions.
Building depreciation is an allocated, noncontrollable cost decided at the organizational level, not by the unit manager.
Question 7 of 15 · Business Skills and Principles · 18%
The unit's new goal is 'timely discharge,' but staff disagree about whether the clock starts at the discharge order or when the patient is ready to leave. Before collecting data, the nurse manager should:
An operational definition states exactly when the clock starts and stops, so every shift counts the measure the same way and the data are valid.
A benchmark target is meaningless until the measure is defined the same way as the benchmark's.
Letting each shift choose its own definition makes the data incomparable across shifts and over time.
Collecting data before defining the measure yields numbers nobody can interpret or trust.
Question 8 of 15 · Business Skills and Principles · 18%
Midyear, administration adds four beds to the unit to relieve emergency department boarding. Staffing costs will clearly exceed the budget for the rest of the year. The nurse manager should:
Holding staffing at the original level despite four added beds puts patients at risk to protect a budget that no longer fits.
Waiting until year-end to explain an overrun that was predictable in midyear denies leaders the chance to plan for it.
A material midyear change in volume makes the original budget obsolete, so the manager should work with finance to revise it using the new projections.
Cutting education and supplies to offset legitimate volume costs creates new risks and hides the real cause of the variance.
Question 9 of 15 · Business Skills and Principles · 18%
A surgeon asks the nurse manager to buy a different brand of dressing directly from a local distributor, although an equivalent product is available through the hospital's group purchasing organization contract. The nurse manager should explain that:
GPO contracts do not stop a hospital from evaluating new products; new items go through product review rather than being banned.
Group purchasing organizations negotiate prices on committed volume, so buying an equivalent product off contract loses that price and can weaken the hospital's compliance with the agreement.
Staying within budget does not make off-contract buying acceptable, because it still forfeits negotiated pricing for the organization.
Physician preference does not override purchasing agreements; preferring a distributor is not a reason to bypass the contract.
Question 10 of 15 · Business Skills and Principles · 18%
A staff nurse strains a lower back while repositioning a patient but says the pain is minor and does not want to file a report. The nurse manager should:
Waiting until a missed shift delays the required report; the trigger is the work injury, not lost time.
Leaving reporting to the nurse risks losing coverage if the strain worsens and skips the employer's own obligation to document a work injury.
Personal health insurance is not the route for a work-related injury, which falls under workers' compensation.
A work-related injury should be reported and evaluated through workers' compensation even when it seems minor, so the nurse is covered and the hospital meets its reporting duties.
Question 11 of 15 · Business Skills and Principles · 18%
Last quarter the unit recorded 2,340 patient days and 520 discharges, with an average daily census of 25.7. What was the unit's average length of stay?
20.2 comes from dividing discharges by the average daily census, which uses the wrong numerator and the wrong denominator.
0.2 comes from dividing discharges by patient days, an inverted ratio.
Average length of stay is patient days divided by discharges: 2,340 ÷ 520 = 4.5 days. The average daily census is a red herring.
5.7 comes from dividing the census of 25.7 by 4.5 days, mixing the census figure into a length-of-stay calculation that does not use it.
Question 12 of 15 · Business Skills and Principles · 18%
The union representing the hospital's nurses delivers the required 10-day notice of intent to strike. What should the nurse manager do?
Once the 10-day notice arrives, the manager should feed unit staffing needs into the hospital's contingency plan so care continues safely during a strike.
Waiting until the strike begins wastes the notice period that the law provides precisely so hospitals can plan coverage.
Threatening permanent firing for striking is unlawful interference with protected concerted activity under the NLRA.
Questioning nurses individually about their strike plans is interrogation, one of the prohibited TIPS behaviors.
Question 13 of 15 · Business Skills and Principles · 18%
Six months after bedside tablets were introduced to support patient education, the nurse manager is asked whether they are worth the ongoing cost. The nurse manager should:
Expanding to other units on the strength of patient comments skips the evaluation of value the manager was asked for.
Comparing usage and outcome data with the goals set before launch shows whether the tablets delivered the intended value for their ongoing cost.
The absence of complaints is not evidence that the tablets achieved anything.
Staff satisfaction is one input, but it does not show whether patient education outcomes justify the cost.
Question 14 of 15 · Business Skills and Principles · 18%
At midyear, the unit's tactic for meeting its strategic goal on falls, a new sign on each door, has produced no improvement. The nurse manager should:
Keeping an ineffective tactic until year-end wastes six months of falls data that already show no improvement.
Adding several tactics at once makes it impossible to tell what works, and it skips analysis of why the first tactic failed.
Midyear review is the time to examine why a tactic is failing and revise it with staff, rather than letting a goal slip all year.
Declaring the goal unrealistic abandons it before the causes of the failed tactic have been examined.
Question 15 of 15 · Business Skills and Principles · 18%
The nurse manager is finishing a business plan for a new nurse-led transitional care clinic. When should the executive summary be written?
The executive summary condenses the finished analysis and recommendation, so it can only be written last, yet it goes at the front for busy decision makers.
Putting it at the back as an appendix defeats its purpose of giving readers the key points first.
Every business plan needs a summary up front; it is not reserved for board presentations.
Writing it first locks in conclusions before the market and financial analyses exist.
Your score shows up after the last answer.
Business traps on the CNML
Average daily census uses patient days and calendar days. Divide the period's patient days by the days in the period. The handbook's sample item hands you bed counts and care hours as well; occupancy, not census, is where beds come in (census divided by beds).
Gantt, PERT and critical path answer different questions. A Gantt chart shows tasks and progress against time; PERT estimates task times from optimistic, likely and pessimistic guesses; the critical path is the run of dependent tasks with no slack, so it fixes the finish date.
A business plan needs quantified objectives. In the handbook's sample, a manager who wants a new educator role and is asked to justify it should state measurable objectives, not survey staff or draft marketing.
Operating and capital budgets are separate. Supplies, salaries and overtime are operating; long-lived equipment above the organization's dollar threshold is capital, requested and ranked on its own cycle.