Question

During 2020, the following transactions were recorded by the Port Hudson Community Hospital, a private sector not-for-profit institution:

1. Gross charges for patient services, all charged to Patient Accounts Receivable, amounted to $1,950,000. Estimated contractual adjustments with third-party payors amounted to $550,000 and the Hospital estimated implicit price concessions would total $25,000.
2. Charity services, not included in transaction 1, would amount to $96,000, had billings been made at gross amounts.
3. Other revenues, received in cash, were parking lot, $35,000; cafeteria, $57,500; gift shop, $12,500.
4. Cash gifts restricted by the donor for programs amounted to $38,750 for the year. During the year, $77,000 was expended for technician salaries supporting the program identified by the donor (debit Operating Expense—Salaries and Benefits).
5. Mortgage bond payments amounted to $74,000 for principal and $46,000 for interest. Assume unrestricted resources are used.
6. During the year, the hospital received, in cash, unrestricted contributions of $63,000 and unrestricted income of $53,750 from endowment investments. (It is the hospital’s practice to treat unrestricted gifts as nonoperating income.)
7. New equipment, costing $182,000, was acquired, using donor-restricted cash that was on hand at the beginning of the year.
8. An old piece of lab equipment that originally cost $200,000 and that had an undepreciated cost of $40,000 was sold for $22,000 cash.
9. At the end of 2020, pledges (restricted as to purpose) were received in the amount of $195,000. These are intended to be received and expended in 2021.
10. Cash contributions were received from donors restricted for plant acquisition, $218,750.
11. Bills were received for the following items: Utilities $158,500 and Insurance $92,000. These will be paid in January of 2021.
12. Depreciation of plant and equipment amounted to $225,000.
13. Cash payments on accounts payable amounted to $208,500. Another $834,500 was expended on wages and benefits.
14. Cash collections of patient accounts receivable amounted to $1,210,000. These were in settlement of patient accounts totaling $1,662,000. Contractual adjustments associated with these totaled $430,000 and price concessions totaled $22,000.
15. Closing entries were prepared.

Required:
a. Record the transactions in the general journal of the Port Hudson Community Hospital.
b. Prepare a Statement of Operations for the Port Hudson Community Hospital for the year ended December 31, 2020.
c. Prepare a Statement of Changes in Net Assets for the Port Hudson Community Hospital for the year ended December 31, 2020. Assume beginning net assets are $7,225,000

Answer 1

Prepare journal entries as follows:

Trn.	General Journal	Debit	Credit
1	Patient Accounts Receivables	$1,950,000
	Revenues-Unrestricted-Patient Service Revenue		$1,950,000
	Contractual Adjustments-Unrestricted	$550,000
	Patient Accounts Receivable		$550,000
2	N/A
3	Cash	$105,000
	Operating Revenues-unrestricted other revenue		$105,000
	[$35000+$57500+$12500]
4	Cash	$38,750
	Revenues-Temporarily Restricted-contributions		$38,750
	Operating Expense-Salaries and benefits	$77,000
	Cash		$77,000
	Reclassification from Temporarily Restricted Net Assets-satisfaction of program Restrictions	$38,750
	Reclassification to unrestricted Net Assets -satisfaction of program Restrictions		$38,750
5	Operating Expense-Interest	$46,000
	Mortgage Bonds payable	$74,000
	Cash		$120,000
6	Cash	$116,750
	Non-operating Income-Unrestricted-Gifts		$63,000
	Non-operating Income-Unrestricted-Income on Investments of Endowment funds		$53,750
7	Equipment	$182,000
	Cash		$182,000
	Reclassification from Temporarily restricted Net Asset-class-satisfaction of Acquisition Restrictions	$182,000
	Reclassification from Unrestricted Net Asset-class-satisfaction of Plan Acquisition Restrictions		$182,000
8	Cash	$22,000
	Accumulated Depreciation-Equipment [$200,000 - $40,000]	$160,000
	Loss of sale of Equipment -Unrestricted-Equipment [$40,000 - $220,00]	$18,000
	Equipment		$200,000
9	Contribution Receivables	$195,000
	Revenues-Temporarily Restricted-contributions		$195,000
10	Cash	$218,750
	Revenues-Temporarily Restricted-contributions		$218,750
11	Operating Expense-Utilities	$158,500
	Operating Expense-Insurance	$92,000
	Accounts payable		$250,500
12	Operating Expense-Depreciation	$225,000
	Accumulated Depreciation		$225,000
13	Accounts payable	$208,500
	Cash		$208,500
	Operating Expense-Salaries and benefits	$834,500
	Cash		$834,500
14	Cash	$1,210,000
	Patient Accounts Receivable		$1,210,000
15	Unrestricted:
	Operating Revenues-Unrestricted-Patient Service Revenue	$1,950,000
	Operating Revenues-unrestricted other revenue	$105,000
	Non-operating Income-Unrestricted-Gifts	$63,000
	Non-operating Income-Unrestricted-Income on Investments of Endowment funds	$53,750
	Reclassification to unrestricted Net assets:
	satisfaction of program restriction	$38,750
	satisfaction of PPE Acquisition Restrictions	$182,000
	Contractual adjsutments		$550,000
	Loss on sale of equipment		$18,000
	Operating Expenses:
	Depreciation		$225,000
	Salaries and benefits		$834,500
	Utilities		$158,500
	Insurance	ekkarill92 Next > < Previous Related Solutions During 2020, the following transactions were recorded by the Port Hudson Community Hospital, a private sector... During 2020, the following transactions were recorded by the Port Hudson Community Hospital, a private sector not-for-profit institution: Gross charges for patient services, all charged to Patient Accounts Receivable, amounted to $1,970,000. Estimated contractual adjustments with third-party payors amounted to $560,000 and the Hospital estimated implicit price concessions would total $27,000. Charity services, not included in transaction 1, would amount to $100,000, had billings been made at gross amounts. Other revenues, received in cash, were parking lot, $37,000; cafeteria, $60,500;... During 2017, the following transactions were recorded by the Port Hudson Community Hospital, a private sector... During 2017, the following transactions were recorded by the Port Hudson Community Hospital, a private sector not-for-profit institution. Gross charges for patient services, all charged to Patient Accounts Receivable, amounted to $1,800,000. Contractual adjustments with third-party payers amounted to $475,000. Charity services, not included in transaction 1, would amount to $66,000, had billings been made at gross amounts. Other revenues, received in cash, were parking lot, $20,000; cafeteria, $35,000; gift shop, $5,000. Cash gifts for cancer research amounted to $26,000... During 2017, the following transactions were recorded by the Port Hudson Community Hospital, a private sector... During 2017, the following transactions were recorded by the Port Hudson Community Hospital, a private sector not-for-profit institution. Gross charges for patient services, all charged to Patient Accounts Receivable, amounted to $1,850,000. Contractual adjustments with third-party payers amounted to $500,000. Charity services, not included in transaction 1, would amount to $76,000, had billings been made at gross amounts. Other revenues, received in cash, were parking lot, $25,000; cafeteria, $42,500; gift shop, $7,500. Cash gifts for cancer research amounted to $30,250... During 2017, the following transactions were recorded by the Port Hudson Community Hospital, a private sector... During 2017, the following transactions were recorded by the Port Hudson Community Hospital, a private sector not-for-profit institution. Gross charges for patient services, all charged to Patient Accounts Receivable, amounted to $1,830,000. Contractual adjustments with third-party payers amounted to $490,000. Charity services, not included in transaction 1, would amount to $72,000, had billings been made at gross amounts. Other revenues, received in cash, were parking lot, $23,000; cafeteria, $39,500; gift shop, $6,500. Cash gifts for cancer research amounted to $28,550... During 2017, the following transactions were recorded by the Port Hudson Community Hospital, a private sector... During 2017, the following transactions were recorded by the Port Hudson Community Hospital, a private sector not-for-profit institution. Gross charges for patient services, all charged to Patient Accounts Receivable, amounted to $1,830,000. Contractual adjustments with third-party payers amounted to $490,000. Charity services, not included in transaction 1, would amount to $72,000, had billings been made all gross amounts. Other revenues, received in cash, were parking lot, $23,000; cafeteria, $39,500; gift shop, $6,500. Cash gifts for cancer research amounted to $28,550... The following transactions were recorded in the General Journal of Hudson Supplies: General Journal of Hudson... The following transactions were recorded in the General Journal of Hudson Supplies: General Journal of Hudson Supplies Date Details Debit Credit 1/11 Cash at bank 31,000 Inventory 10,000 Machinery 9,500 Motor vehicle 8,000 Capital 58,500 Commencement of business 4/11 Office equipment 12,600 GST Receivable 1,260 Accounts Payable Control 13,860 Purchased office equipment on credit from Real Services 8/11 Inventory 6,660 GST Receivable 666 Accounts Payable Control 7,326 Purchased inventory on credit from Simpson Pty Ltd 10/11 Cash at bank 7,150... Governmental Hospital. During 2017, the following selected events and transactions were recorded by Nichols County Hospital.... Governmental Hospital. During 2017, the following selected events and transactions were recorded by Nichols County Hospital. Gross charges for hospital services, all charged to accounts and notes receivable, were as follows: Patient service revenues $1,664,900 The hospital cafeteria and gift shop had cash sales of $295,300. Additional information relating to current-year is as follows: Contractual adjustments. $632,000 Provision for bad debts $30,200 Charity Care $261,400 A federal cost reimbursement research grant of $350,000 was awarded. As of the end of... The following selected events and transactions were recorded by Milos County Hospital. Gross charges for hospital... The following selected events and transactions were recorded by Milos County Hospital. Gross charges for hospital services, all charged to accounts and notes receivable, were as follows: Patient service revenue $1,664,900 The hospital cafeteria and gift shop had cash sales of $295,300. Additional information determined subsequently to recording patient service revenues and relating to the current year is as follows: Contractual adjustments $ 632,000 Provision for bad debts 30,200 Charity care 261,400 A federal cost reimbursement research grant of $350,000... You are the Chief Executive officer of Mansura Community Hospital, a purely private sector operator. The... You are the Chief Executive officer of Mansura Community Hospital, a purely private sector operator. The hospital has a patient base of 6,000 with 50% using the services of the hospital twice each year. Existing records suggest that 35% of patients who use the hospital also need MRI images for their doctors to make appropriate decisions. The MRI of the hospital has for some time now not been in good working condition. The effect of this situation is that you... Clapton Guitar Company entered into the following transactions during 2016. [The transactions were properly recorded in... Clapton Guitar Company entered into the following transactions during 2016. [The transactions were properly recorded in permanent (balance sheet) accounts unless otherwise indicated.] Date Transaction Jan. 25 Purchased $480 of office supplies. Feb. 1 Rented a warehouse from Hendrix Company, paying 1 year’s rent of $3,600 in advance. Recorded the $3,600 payment as rent expense. Mar. 1 Borrowed $10,000 from the bank, signing a 1-year note at an annual interest rate of 12%. The bank insisted on collecting the interest... ADVERTISEMENT Subjects Accounting Advanced Math Anatomy and Physiology Biology Chemistry Civil Engineering Computer Science Economics Electrical Engineering Finance History Math Mechanical Engineering Operations Management Physics Psychology Statistics and Probability Nursing Other ADVERTISEMENT Latest Questions How does the rotating membership of the FOMC work? Why does the president of New York's... A gym owner is considering opening a location on the other side of town. The new... a) What is the difference between resonance and non-resonance Raman transitions? b) What is the difference... 1. Why do most leases have expensive cancellation provisions? Does the existence of this provision shift... The requirements for your assignment are: Decode the IP address 172.16.31.255 /20 Determine the following: Subnet... Examine the various types of contracts available to Toyota when dealing with international suppliers and advise... Problem 10-08 NPVs, IRRs, and MIRRs for Independent Projects Edelman Engineering is considering including two pieces... ADVERTISEMENT About @ 2020 WizEdu