St. Joseph's Hospital began operations in December 2019 and had patient service revenues totaling $1,210,000 (based on customary rates) for the month. Of this, $137,000is billed to patients, representing their insurance deductibles and copayments. The balance is billed to third-party payors, including insurance companies and government health care agencies. St. Joseph's estimates that 20 percent of these third-party payor charges will be deducted by contractual adjustment. The hospital's fiscal year ends on December 31.

Required:

1. Prepare the journal entries for December 2019. Assume 15 percent of the amounts billed to patients will be reduced through implicit price adjustments.

2. Prepare the journal entries for 2020 assuming the following:

1. $117,000 is collected from the patients during the year and $11,200 of price adjustments are granted to individuals.
2. Actual contractual adjustments total $296,000. The remaining receivable from third-party payors is collected.

transaction list

1. Record the amount collected from the patients during the year 2020 and also the price adjustments granted to individuals.
2. Record the year end allowance for contractual adjustments for 2020.
3. Record the amount collected and actual contractual adjustments receivable from the third-party payors for 2020.