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In: Accounting

The following transactions on the books of St. Marie’s Hospital, a private not-for-profit hospital in 2017....

The following transactions on the books of St. Marie’s Hospital, a private not-for-profit hospital in 2017.

(a) The Hospital billed patients $612,000 for services rendered. Of this amount, 5% is expected to be uncollectible. Contractual adjustments with insurance companies are expected to total $87,000.

(b) The Hospital received $750,000 in pledges of support in a campaign undertaken to purchase new MRI equipment. All of the pledges are payable within one year and 8% are expected to be uncollectible.

(c) Charity care in the amount of $36,000 (at standard charges) was performed on an indigent patient.

(d) The Hospital collected $487,200 for the services performed in (1) above. Actual contractual adjustments for these services amounted to $89,700. $ 13,700 of receivables were identified as uncollectible and written off.

St. Marie's Hospital
General Journal
Account DR CR
a
b
c No journal entry required.
d Cash

Solutions

Expert Solution

St. Marie's Hospital
a. Patient Accounts receivable 612000
Operating revenues - Patient service revenue - unrestricted 612000
Operating exp. General services - bad debts 30600
Allowance for patient AR ( 612000 * 5% ) 30600
Contractual adjustements - unrestricted 87000
Allowance for contrcatual Adjustements 87000
b. Pledges receivable 750000
Allowance for uncollectible pledges ( 750000 * 8% ) 60000
Nonoperating revenues contributions - temporarily restricted 690000
c. No journal entry
d. Cash 487200
Patient Accounts receivable 487200
Allowance for contractual Adjustements 87000
contractual Adjustements 2700
Patient Accounts receivable 89700
Allowance for patient AR 13700
Patient Accounts receivable 13700

ekkarill92 answered 2 years ago
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