Valley Hospital is a not-for-profit hospital which follows FASB and AICPA standards. Please record the transactions below for the hospital. 1 Patient revenues, using hosptial standard rates, were $100,000 for the week. Of this, $20,000 was billed to the patients, representing their insurance deductibles and co-payments. The balance ($80,000) is billed to insurance carriers. Valley Hospital estimates that $16,000 of the $80,000 will be deducted by contractual adjustment. 2 Valley Hospital estimates that 10% of the amount billed patients in #1 will not be collected, and the appropriate adjustment is recorded. Please remember, Patient revenue is reduced by estimated bad debts in not-for-profit settings. 3 of the $80,000 billed insurance carriers in #1, final collections totaled $61,000. Record the collections, including the adjustment to contractual adjustments accounts. 4 Of the $20,000 billed the patients, $17,000 is received in cash, and the remaining $3,000 will not be collected. 5 Received a donation of an automobile, fair value $18,000, the donor required that the automobile be used to transport cancer patients to and from their homes to the hospital. 6 At the end of the year, $2,500 depreciation is recorded on the automobile received in #5. Unrestricted Temporarily Restricted Permanently Restricted Debit Credit Debit Credit Debit Credit Valley Hospital is a not-for-profit hospital which follows FASB and AICPA standards. Please record the transactions below for the hospital. 1 Patient revenues, using hosptial standard rates, were $100,000 for the week. Of this, $20,000 was billed to the patients, representing their insurance deductibles and co-payments. The balance ($80,000) is billed to insurance carriers. Valley Hospital estimates that $16,000 of the $80,000 will be deducted by contractual adjustment. 2 Valley Hospital estimates that 10% of the amount billed patients in #1 will not be collected, and the appropriate adjustment is recorded. Please remember, Patient revenue is reduced by estimated bad debts in not-for-profit settings. 3 of the $80,000 billed insurance carriers in #1, final collections totaled $61,000. Record the collections, including the adjustment to contractual adjustments accounts. 4 Of the $20,000 billed the patients, $17,000 is received in cash, and the remaining $3,000 will not be collected. 5 Received a donation of an automobile, fair value $18,000, the donor required that the automobile be used to transport cancer patients to and from their homes to the hospital. 6 At the end of the year, $2,500 depreciation is recorded on the automobile received in #5. Unrestricted Temporarily Restricted Permanently Restricted Debit Credit Debit Credit Debit Credit
