Not-for-Profit Hospital, The Phelps Community Hospital balance sheet as of December 31, 2010, follows.

Required
a. Record in general journal form the effect of the following transactions during the fiscal year ended December 31, 2011, assuming that Phelps Community Hospital is a not-for-profit hospital.

(1) Summary of revenue journal:

Patient services revenue, gross                                    $3,584,900

Adjustment and allowances.

Contracting agencies                                                    162,000

(2) Summary of cash receipts journal:

Interest on investment in Asset Limited as to Use 7,350

Unrestricted grant from United Fund                                     300,000

Collections of receivables                                3,520,600

(3) Purchases journal:

Administration expenses                                              167,900

General services expenses                                            181,200

Nursing services expenses                                            278,800

Other professional services expenses                           263,100

(4) Payroll journal:

Administration expenses                                              253,700

General services expenses                                            179,200

Nursing services expenses                                            659,200

Other professional services expenses                           422,400

(5) Summary of cash payments journal:

Interest expense                                                           280,000

Payment on mortgage principal                                   500,000

Accounts payable for purchases                                  936,800

Accrued payroll                                                           1,579,500

Transfer to Assets Limited as to Use                           30,000

(6) The following additional information relates to assets limited as to use:
(a) $10,000 in CDs matured on which $590 in interest was earned.
(b) $30,000 was reinvested in CDs.
(c) $12,300 in equipment was purchased.
(7) Depreciation charges for the year amounted to $117,000 for the buildings and $128,500 for equipment.
(8) Other information:
(a) Provision for uncollectible receivables was increased by $3,800.
(b) Supplies inventory:

(c) Portion of mortgage payable due within one year, $500,000.
(9) Assume that there was no change in fair value of investments at year- end.
(10) Provisions for bad debts, interest expense, and depreciation expense were allocated to functional expense accounts in proportion to their pre allocation balances. Nominal accounts were closed.
(11) Reflecting the net increase in Assets Limited as to Use of $25,640 (see transactions 2, 5, and 6), record the increase in Net Assets'Unrestricted, Designated for Plant Replacement.
b. Prepare a balance sheet as of December 31, 2011.
c. Prepare a statement of operations for the year ended December 31,2011.

Transcribed Image Text:

Liabilities and Net Assets Assets Current: Current: Accounts payable Cash 65,000 65,000 Accounts and $ 140,000 notes receivable Accrued payroll 110,000 Less: Allowance for uncollectibles 12,000 128,000 Inventory 71,000 Total current assets Total current liabilities 175,000 264,000 Assets limited as to use: Cash Long-term debt: Mortgage payable 11,500 Investments 210,000 3,500,000 Total assets Total liabilities 3,675,000 Net assets. limited as to use 221,500 Property, plant, and equipment: Unrestricted, undesignated Unrestricted, designated for plant replacements 1,782,000 Land 208,000 Buildings, at cost 4,516,000 221,500 Less: Accumulated Total net assets 2,003,500 depreciation 1,506,000 3,010,000 Equipment, at cost Less: Accumulated depreciation 2,871,000 896,000 1,975,000 Total property, plant, and 5,193,000 equipment Total liabilities and Total assets $5,678,500 $5,678,500 net assets