31. Under Lennon Hospital’s rate structure, it earned patient service revenue of $9 million for the year ended December 31, 2008. However, Lennon did not expect to collect this entire amount because it deemed $1.4 million to be charity care and estimated contractual adjustments to be $800,000.

During 2008, Lennon purchased medical supplies from Harrison Medical Supply Company at a cost of $4,000. Harrison notified Lennon that it was donating the supplies to the hospital.

At the end of 2008, Lennon had board-designated assets consisting of cash of $60,000 and investments of $800,000.

Lennon is a private not-for-profit organization: How much should Lennon record as patient ser¬ vice revenue and how much as net patient service revenue? How should Lennon record the dona¬ tion of the supplies? How are the board-designated assets shown on the balance sheet?