Prepare a Statement of Changes in Net Assets for the Port Hudson Community Hospital for the year ended December 31, 2024. Assume beginning net assets are $7,000,000.
During 2024, the following transactions were recorded by the Port Hudson Community Hospital, a private-sector not-for-profit institution:
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Gross charges for patient services, all charged to Patient Accounts Receivable, amounted to $1,675,000. Estimated contractual adjustments with third-party payors amounted to $405,000, and the hospital estimated implicit price concessions totaling 35,000.
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Charity services, not included in transaction 1, would amount to $66,000 had billings been made at gross amounts.
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Other revenues received in cash were parking lot, $20,000; cafeteria, $35,000; gift shop, $5,000.
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Cash gifts restricted by the donor for programs amounted to $32,000 for the year. During the year, $50,000 was expended for technician salaries supporting the program identified by the donor (Debit Operating Expense—Salaries and Benefits).
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Mortgage bond payments amounted to $50,000 for principal and $28,000 for interest. Assume unrestricted resources are used.
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During the year, the hospital received, in cash, unrestricted contributions of $42,000 and unrestricted income of $35,000 from endowment investments. (It is the hospital’s practice to treat unrestricted gifts as nonoperating income.)
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New equipment, costing $280,000, was acquired using donor-restricted cash that was on hand at the beginning of the year.
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An old piece of lab equipment that originally cost $50,000 and had an undepreciated cost of $10,000 was sold for $7,000 cash.
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At the end of 2024, pledges (restricted as to purpose) were received in the amount of $50,000. These are intended to be received and expended in 2025.
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Cash contributions were received from donors restricted for plant acquisition, $170,000.
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Bills were received for the following items: utilities, $139,000, and insurance, $80,000. These will be paid in January of 2025.
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Depreciation of plant and equipment amounted to $180,000.
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Cash payments on accounts payable amounted to $168,000. Another $910,000 was expended on wages and benefits.
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Cash collections of patient accounts receivable amounted to $1,180,000. These were in settlement of patient accounts totaling $1,587,000. Contractual adjustments associated with these totaled $400,000, and price concessions totaled $7,000.
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Closing entries were prepared.
c. Prepare a Statement of Changes in Net Assets for the Port Hudson Community Hospital for the year ended December 31, 2024. Assume beginning net assets are $7,000,000.
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