42.Which of the following would most likely appear as a liability on the balance sheet of a healthcare organization?

a. Interest payments made by the healthcare organization on an outstanding loan.

b. The outstanding balance on a loan taken by the healthcare organization.

c. Salaries owed to employees, but not paid as of the balance sheet date.

d. The current market value of investment in stcok and bonds owned by the healtcare organization.

e. Statement b. and c. are both correct.

Which of the following would most likely appear as an asset on the balance sheet of a healthcare organization?

a. Salaries owed to employees, but not paid as of the balance sheet date.

b. Equipment purchased during the accounting period to be used over the next five years.

c. The outstanding balance on a loan taken by the healthcare organization.

d. The current market value of investments in stocks and bonds owned by the healthcare organization.

e. Statements b. and d. are both correct.

40.Which of the following statements about equity is most correct?

a. Equity represents the amount of cash available to the organization.

b. Equity is the residual claim against assets after all liabilities have been paid off.

c. Equity claims are paid before liability claims if a healthcare organization is liquidated.

d. Equity must always be positive.

e. The balance of an organizations equity as of a given date is shown on the organizations income statement.

38.Which of the following statements best describes the statement of changes in equity?

a. It shows how much of net income is retained within the business.

b. It shows how much of net income flows to the balance sheet equity account.

c. For investor-owned businesses, it shows how much of net income is paid out as dividends.

d. Statements a. and c. are both correct. e. Statements a., b., and c. are all correct.

39. True or False: Fund accounting is used by investor-owned (for-profit) businesses to differentiate between operating funds and retirement funds.

38.Which of the following statements best describes the statement of changes in equity?

a. It shows how much of net income is retained within the business.

b. It shows how much of net income flows to the balance sheet equity account.

c. For investor-owned businesses, it shows how much of net income is paid out as dividends.

d. Statements a. and c. are both correct.

e. Statements a., b., and c. are all correct.

.Which of the following statements about operating income, nonoperating income, and net income is most correct?

a.Operating income typically is greater than net income.

b.For hospitals, nonoperating income includes outpatient services income.

c.Operating income focuses on the profitability of a providers core business.

d. Net income is defined as operating income less nonoperating income. e. Net income focuses on the profitability of a providers core business .

Which of the following statements about revenues, expenses, most correct?

a. Revenues increase the equity of an organization.

b. Expenses decrease the equity of an organization.

c. Net income (less any dividend payments) increases the equity of an organization.

d. Net losses decrease the equity of an organization.

e. Statements a., b., c., and d. are all correct.

5.Assume Hospital A is a for-profit organization that pays taxes at a rate of 30 percent and Hospital B is a not-for-profit organization that pays no taxes. If depreciation expense for the year ended December 31, 2015 was doubled (e.g., from $100,000 to $200,000) for both organizations, which of the following statements is most correct? 

a. Net income would increase for both Hospitals A and B. b. Net income would decrease for Hospital A but not for Hospital B.

c. Estimated cash flow would increase for both Hospitals A and B

d. Estimated cash flow would increase for Hospital A but not for hospital B.

e. Estimated cash flow would increase for Hospital B but not for the hospital A.