Problem 2 (20 points) Coop Hospital is a nonprofit hospital, some transactions are shown below. Please prepare journal entries for each of these transactions. Please note that all "pledges" in this problem are not received in cash unless specified in the transaction 1. Gross patient service revenue amounted to $82,656, of which $71,650 was received in cash. Also, contractual adjustments to insurance companies, amounted to $10,000 2. The estimate for the provision for uncollectible patient accounts receivable was made, and uncollectible accounts were estimated to be $11,200. 3. Patient accounts receivable were actually written off, $2,600. 4. A donor gave the hospital $40,000 and stipulated that this must be used for counseling of families of cancer patients. 5. A few weeks after the donation in M4 above was received, counseling services were provided to families of cancer patients, $6,000. This was paid for from the proceeds received in #4. 6. A donor gave the hospital $1,000,000, to be added to its endowment for burn patients. 7. Interest earnings from the endowment in #6 totaled $65,000, cash. These earnings were spent to assist burn patients. Please record the entries necessary for the earnings and spending of the $65,000 8. The hospital gift shop had sales of $15,000, cost of items sold was $6,900. 9. A member of the community pledged $80,000 to the hospital, and specified that this pledge must be used to upgrade the hospital emergency room facilities. 10. One month later, the amount in #9 was received, and was spent to upgrade the information technology equipment used to register patients. Problem 3 (20 points) Cardinal University, a public state university, had the following transactions during the year. Please prepare the journal entries below for Cardinal University. Please be sure to designate revenues and expenses as "operating" or "nonoperating." 1. Gross tuition and fees revenue totaled $5,600,000, on account. 2. With regard to #1, $276,400 of tuition waivers were granted students for which they are paid for work study employment 3. With regard to #1, $69,600 tuition waivers are granted for academic scholarships in which no work is required on the part of the students. 4. Cash from Federal Pell Grants was received, $50,000. 5. During the year received a gift of $45,000 from an alum of the college. She stated that this gift may not be spent until the following fiscal year. 6. Received a cash donation of $1,000,000 from an alumni. She specified that this must be kept as an endowment and only earnings can be spent, and they must be spent on the University accounting program. 7. The amount received in #6 was invested in bonds. 8. The endowment in #6 had interest earnings of $20,0000. These earnings were then spent on accounting scholarships 9. Tuition of $500,000 is received for classes to be taken the following fiscal year. 10. Tuition of $6,400 is written off as uncollectible
