Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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

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; gift shop, $13,500. Cash gifts restricted by the donor for programs amounted to $40,450 for the year. During the year, $80,600 was expended for technician salaries supporting the program identified by the donor (debit Operating ExpenseSalaries and Benefits). Mortgage bond payments amounted to $77,200 for principal and $48,400 for interest. Assume unrestricted resources are used. During the year, the hospital received, in cash, unrestricted contributions of $65,800 and unrestricted income of $56,250 from endowment investments. (It is the hospitals practice to treat unrestricted gifts as nonoperating income.) New equipment, costing $186,000, was acquired, using donor-restricted cash that was on hand at the beginning of the year. An old piece of lab equipment that originally cost $220,000 and that had an undepreciated cost of $44,000 was sold for $24,000 cash. At the end of 2020, pledges (restricted as to purpose) were received in the amount of $130,000. These are intended to be received and expended in 2021. Cash contributions were received from donors restricted for plant acquisition, $305,000. Bills were received for the following items: Utilities $161,100 and Insurance $93,600. These will be paid in January of 2021. Depreciation of plant and equipment amounted to $231,000. Cash payments on accounts payable amounted to $213,900. Another $839,100 was expended on wages and benefits. Cash collections of patient accounts receivable amounted to $1,214,000. These were in settlement of patient accounts totaling $1,672,000. Contractual adjustments associated with these totaled $434,000 and price concessions totaled $24,000. 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 $7,255,000.

Record the gross charges for patient services, all charged to Patient Accounts Receivable, amounted to $1,970,000.

2

Record the estimated contractual adjustments for patient services with third-party payors amounted to $560,000.

3

Record the $27,000 estimated implicit price concessions.

4

Charity services, not included in transaction 1, would amount to$100,000, had billings been made at gross amounts.

5

Other revenues, received in cash, were parking lot, $37,000; cafeteria, $60,500; gift shop, $13,500.

6

Record the cash gifts received for programs.

7

Record the $80,600 technician salaries supporting the program.

8

Record the reclassification of assets in satisfaction of program restrictions.

9

Mortgage bond payments amounted to $77,200 for principal and $48,400 for interest. Assume unrestricted resources are used.

10

During the year, the hospital received, in cash, unrestricted contributions of $65,800 and unrestricted income of $56,250 from endowment investments.

11

Record the new equipment, costing $186,000, acquired using donor-restricted cash that was on hand at the beginning of the year.

12

Record the reclassification of net assets due to equipment acquisition.

13

An old piece of lab equipment that originally cost $220,000 and that had an undepreciated cost of $44,000 was sold for $24,000 cash.

14

At the end of 2020, pledges (restricted as to purpose) were received in the amount of $130,000. These are intended to be received and expended in 2021.

15

Cash contributions were received from donors restricted for plant acquisition, $305,000.

16

Record the bills received for Utilities $161,100 and Insurance $93,600 to be paid in January of 2021.

17

Depreciation of plant and equipment amounted to $231,000.

18

Record the cash payments on accounts payable amounted to $213,900.

19

Record the $839,100 expended on wages and benefits.

20

Cash collections of patient accounts receivable amounted to $1,214,000. These were in settlement of patient accounts totaling $1,672,000. Contractual adjustments associated with these totaled $434,000 and price concessions totaled $24,000.

21

Record the closing entry for net assets without donor restrictions.

22

Record the closing entry for net assets with donor restrictions.

Prepare a Statement of Operations for the Port Hudson Community Hospital for the year ended December 31, 2020. (Input all amounts as positive values. Loss amounts should be indicated by a minus sign.)

PORT HUDSON COMMUNITY HOSPITAL
Statement of Operations
For the Year Ended December 31, 2020
Revenues Without Donor Restrictions:
Total Revenues 0
Net Assets Released From Restrictions:
Total Operating Revenues 0
Operating Expenses:
Total Operating Expenses 0
Other Income:
Total Other Income 0
Excess of Revenues Over Expenses 0
Net Assets Released from Restrictions:

2020. Assume beginning net assets are $7,255,000. (Loss/Negative amounts should be indicated by a minus sign.)

PORT HUDSON COMMUNITY HOSPITAL
Statement of Changes in Net Assets
For the Year Ended December 31, 2020
Net Assets without Donor Restrictions:
Net Assets Released From Restrictions:
0
Net Assets with Donor Restrictions:
0
Net Assets, Beginning of Year
Net Assets, End of Year $0

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Financial Accounting

Authors: Clarence Byrd, Ida Chen

4th Edition

013089611X, 978-0130896117

More Books

Students also viewed these Accounting questions

Question

5. How is Karen Slagles argument an example of confirmation bias?

Answered: 1 week ago