GOVERNMENTAL CH 14 TRUE OR FALSE

1.When a donor contributes cash with no strings attached, this means the hospital should report the contribution as revenue right away.

Select one:

True

False

2.Both governmental and nonprofit hospitals must report their investments in debt and equity securities at their fair value.

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True

False

3.When a governmental hospital that meets the definition of an enterprise fund purchases a building, it must report the entire cost of the building as a capital expenditure.

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True

False

4.If a dietician in the community donates her time to the local nonprofit hospital to help it create better menus for its food service, that nonprofit hospital should report her services as contributed services revenue equal to the fair value of her services and the same amount as an expense.

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True

False

5. Nonprofit hospitals are required to include a performance indicator in their operating statements called Excess of revenue over expenses, that excludes unrealized gains and losses on investments and net assets released from restrictions.

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True

False

6. Once a governmental or nonprofit hospital decides that its patient meets the definition of a charity care case, they are no longer permitted to report the fees that are charged for the services provided to that patient as revenue.

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True

False

7. Nonprofit hospitals are required to present two operating statements. The second statementa statement of changes in net assetsreports on both changes in net assets without donor restrictions and in net assets with donor restrictions.

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True

False

8. Governmental hospitals are required to distinguish between operating and nonoperating revenue and expenses but not between changes in net assets with donor restrictions and net assets without donor restrictions.

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True

False

9. Hospitals sometimes work with third-party payers who pay an interim rate based on a percentage of the hospital's established rates but also have the right to adjust their payments lateror retrospectively.

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True

False

10. Financial reporting by nonprofit hospitals focuses on three classes of net assetsrestricted, unrestricted, and endowments.

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True

False

11. All three kinds of organizations may be health care providersprivate or investor-owned hospitals, governmental hospitals, or nonprofit.

Select one:

True

False