P 19-1 Statement of activities- Hospital

The following events were recorded on the books of Mercy Hospital for the year ended

December 31, 2012.

1.) Revenue from patient services totaled $16,000,000. The allowance for uncollectibles was establised

at $3,400,000. of the $16,000,000 revenue, $6,000,000 was recognized under cost reinbursement agreements.

This revenue is subject to audit and retroactive adjustment by third-party payers (estimated adjustments

are included in the allowance accoun).

2.) Patient service revenue is accounted for at established rates on the accrual basis.

3.) Other operating revenue totaled $346,000, of which $160,000 was from specific purpose funds.

4.) Mercy received $410,000 in unrestricted gifts and bequests. They are recorded at fair market value

when received.

5.) Endowment funds earned $160,000 in unrestricted income.

6.) Biard desgnated funds earned $82,000 in income.

7.( Mercy's operating expenses for the year amounted to $13,370,000. This included $500,000 in

straight-line depreciation.

Required:

Prepare a statement of activities for Mercy Hospital for the year ended December 31,2012.