Advanced Accounting
12th Edition
ISBN: 9781305084858
Author: Paul M. Fischer, William J. Tayler, Rita H. Cheng
Publisher: Cengage Learning
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Chapter 19, Problem 19.10.5P
To determine
Introduction: Health Care organizations are continuously serving to the well-being of the individuals & meeting the health needs of the people.
To select: The best option.
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1. A not-for-profit hospital performs services in the current year at a charge of $1 million. Of this amount, $200,000 is viewed as charity care services because no collection was expected at the time of the work. Additionally, officials expect another $94,000 to be bad debts. What should the hospital report as net patient service revenues?
Select one:
a.$906,000
b.$1,000,000
c.$706,000
d.$800,000
2. In the accounting for health care providers, what are third-party payors?
Select one:
a.Friends and relatives who pay the medical costs of a patient.
b.Doctors who reduce fees for indigent patients.
c.Insurance companies and other groups that pay a significant portion of the medical fees in the United States.
d.Charities that supply medicines to hospitals and other health care providers.
3.What is a contractual adjustment?
Select one:
a.A year-end journal entry to recognize all of a health care entity's remaining receivables.
b.An increase in a patient's…
Problem #1
Record the following transactions for Porter Hospital, a private, nonprofit hospital:
Gross patient services revenues: $25,000,000. Billed to patients.
2. Included in the above revenues are: charity services, $500,000; contractual adjustments, $11,000,000; and estimated uncollectible amounts, $250,000.
3. Purchased equipment by issuing a 5-year note for $200,000.
4. Received cash donations restricted for a capital building addition program, $5,100,000.
5. Incurred and paid $1,700,000 of contractor billings for the capital building program.
Required information
[The following information applies to the questions displayed below.]
For a number of years, a private not-for-profit entity has been preparing financial statements that do not necessarily
conform to U.S. generally accepted accounting principles. At the end of the most recent year (Year 2), those financial
statements show total assets of $900,000, total liabilities of $100,000, net assets without donor restriction of $400,000,
and net assets with donor restrictions of $400,000. This last category is composed of $300,000 in net assets with
purpose restrictions and $100,000 in net assets that must be permanently held. At the end of Year 1, financial statements
show total assets of $700,000, total liabilities of $60,000, net assets without donor restriction of $340,000, and net assets
with donor restrictions of $300,000. This last category is composed of $220,000 in net assets with purpose restrictions
and $80,000 in net assets that must be permanently held. Total…
Chapter 19 Solutions
Advanced Accounting
Ch. 19 - Prob. 1UTICh. 19 - Prob. 2UTICh. 19 - Prob. 3UTICh. 19 - Distinguish assets lmited as to use from...Ch. 19 - Prob. 5UTICh. 19 - Prob. 6UTICh. 19 - Prob. 1ECh. 19 - Record the following operating activities: 1....Ch. 19 - Record the following events that affect the loan...Ch. 19 - Prob. 5E
Ch. 19 - Prob. 6ECh. 19 - Prob. 7ECh. 19 - Prob. 8ECh. 19 - Prob. 9ECh. 19 - Prob. 19.1.1PCh. 19 - Prob. 19.1.3PCh. 19 - Prob. 19.1.4PCh. 19 - Prob. 19.1.5PCh. 19 - Prob. 19.1.6PCh. 19 - Prob. 19.1.7PCh. 19 - Prob. 19.1.8PCh. 19 - Prob. 19.1.9PCh. 19 - Prob. 19.1.10PCh. 19 - Prob. 19.2.1PCh. 19 - Prob. 19.2.2PCh. 19 - Prob. 19.2.3PCh. 19 - Prob. 19.2.4PCh. 19 - Prob. 19.2.5PCh. 19 - Prob. 19.2.6PCh. 19 - Prob. 19.2.7PCh. 19 - Prob. 19.2.9PCh. 19 - Prob. 19.2.10PCh. 19 - Prob. 19.4.1PCh. 19 - Prob. 19.4.2PCh. 19 - Prob. 19.5PCh. 19 - Prob. 19.6.1PCh. 19 - Prob. 19.6.2PCh. 19 - Prob. 19.7.1PCh. 19 - Prob. 19.7.2PCh. 19 - Prob. 19.8.1PCh. 19 - Prob. 19.8.2PCh. 19 - Prob. 19.10.1PCh. 19 - Prob. 19.10.2PCh. 19 - Prob. 19.10.3PCh. 19 - Prob. 19.10.4PCh. 19 - Prob. 19.10.5PCh. 19 - Prob. 19.10.6PCh. 19 - Prob. 19.10.7PCh. 19 - Prob. 19.10.8PCh. 19 - Prob. 19.10.9PCh. 19 - Prob. 19.10.10PCh. 19 - Prob. 19.11.1PCh. 19 - Prob. 19.11.2PCh. 19 - Prob. 19.11.3PCh. 19 - Prob. 19.11.4PCh. 19 - Prob. 19.11.5PCh. 19 - Prob. 19.11.6PCh. 19 - Prob. 19.11.7PCh. 19 - Prob. 19.11.8PCh. 19 - Prob. 19.11.9PCh. 19 - Prob. 19.11.10PCh. 19 - The following nominal accounts were extracted from...Ch. 19 - Prob. 19.15P
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- Fill in the blanks: Loves Medical Center is a non-profit hospital. In 2019 it reported the following gross income and expenses: Related Activities Unrelated Activities Total Gross income P4,000,000 P5,000,000 P9,000,000 Directly traceable expenses 3,075,000 3,000,000 6,075,000 Common expenses of both activities 1,125,000 Net income P1,800,000 REQUIRED: Compute the tax due assuming From the given facts the income tax due is NOTE. Answers are in numerical form. COMMA PESO SIGN and other characters are NOT REQUIRED < Previous Shot on OnePlus Powered by Triple Cameraarrow_forwardA private not-for-profit health care entity has the following account balances: What is reported as the organization’s net patient service revenue? $880,000 $800,000 $690,000 $680,000arrow_forward66. A private not-for-profit hospital provided $150,000 in charity care for the current year. The hospital should report this charity care as a. Net patient service revenue of $150,000 and pa- tient care expense of $150,000. b. Net patient service revenue of $150,000 on the statement of operations. c. Only in the notes to the financial statements. d. As an unpaid accounts receivable on the balance sheet. 67. The Johnson Hospital, a private not-for-profit hospital, received the following revenues in the cur- rent year: Proceeds from sales of the Hospital's flower shop Dividends and interest revenue not restricted $60,000 $20,000 Cash contributions for the renovation of the children's ward in the Hospital $200,000 Which of these amounts should be reported as other revenues and gains (other revenue) on the Statement of Operations? a. $280,000 b. $60,000 c. $80,000 d. $260,000 68. The Whitlow Hospital, a private not-for-profit hospital, uses as its performance indicator revenues and gains…arrow_forward
- 2. ABC Hospital, a private non-profit hospital, has gross receipts ofP19,000,000,00 with a cost of P6,000,000,00 and allowable deductions ofP3,250,000.00 from related activities, while for its unrelated activities, it incurredP5,000,000.00 and P2,000,000.00 as cost of sales and allowable deductions,respectively, with a gross receipts of P18,000,000,00, for Calendar Year 2021.Tax due is:arrow_forwardakefield Hospital’s accounting records disclosed the following information: Cost of property and equipment net of accumulated depreciation $ 4,750,000 Board designated funds 650,000 Grant proceeds that must be used to study treatment of burn victims 750,000 Investments reported in endowment funds 250,000 What amount should be included as part of the General Fund?arrow_forwardA not-for-profit medical center performs services in the current year at a charge of $1 million. Of this amount, $200,000 is viewed as charity services because no collection was expected at the time of the work. The direct costs of that work were $80,000 and the indirect costs were $50,000. What amount of these costs has to be disclosed? Choose the correct.a. $50,000b. $80,000c. $130,000d. $280,000arrow_forward
- Record in general journal form the following selected transactions for Meridian Hospital, a nongovernmental not for-profit institution. (or no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) 1. Gross charges accrued for patient services rendered during the period amounted to $7,870,000, of which $350,000 represented charity care for indigent patients 2. During the year the implicit price concessions for individual payors was determined to be $190,000 and contractual adjustments amounted to S435,000. 3. A wealthy donor donated $2.000,000 in cash to construct a new cardiology wing on the hospital. 4. During the yeat, the new cardiolody wing (see item 3) was one-half completed at a cost of $1.000.000. View transaction list Journal entry worksheet Record the $190,000 implicit price concessions for individual payers and $435,000 contractual adjustments. Note Enter debits befare credits Transaction General Journal Debit Credi 02…arrow_forwardWhat would be the total expense for the Routine Care department (this is the addition of direct department expenses and allocated indirect costs). Revenues Department Facilities (support dept) Accounting - Billing (support dept) Total for Support Departments Routine Care (patient services) Intensive Care (patient services) Diagnostic Services (patient services) Total for Patient Service Departments Grant Total Select one or more: □ a. $11,448,000 O b. $3,750,000 c. $1,448,000 d. $912,750 $ $ $ S $ Expenses $ 1,500,000 $ 2,000,000 S 3,500,000 30,000,000 $ 25,000,000 $ 20,000,000 $ 75,000,000 S 75,000,000 $ 10,000,000 8,000,000 6,000,000 24,000,000 27,500,000 Space (square Feet) Number of Procedure 10,000 20,000 30,000 150,000 100,000 75,000 325,000 355,000 500,000 450,000 375,000 1,325,000 1,325,000arrow_forwardDippel Hospital's December 31, 20X2, balance sheet reported hospital net assets of $8,645. Dippel's 20X2 excess of revenue over expenses was $714. What was reported as hospital net assets in Dippel's balance sheet at December 31, 20X1?arrow_forward
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