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XYZ Health Clinic provides medical services. Financial transactions for 2023 include: Transactions (in $ millions) Amount Patient Service Revenue 60.0 Accounts Receivable 15.0 Cash Payments
XYZ Health Clinic provides medical services. Financial transactions for 2023 include:
Transactions (in $ millions) | Amount |
Patient Service Revenue | 60.0 |
Accounts Receivable | 15.0 |
Cash Payments | 35.0 |
Accounts Payable | 10.0 |
Medical Supplies Purchases | 20.0 |
Estimated Bad Debts | 5.0 |
Requirements:
- Prepare XYZ Health Clinic's income statement for 2023 using the modified cash basis.
- Calculate net income considering the conservatism principle.
- Discuss the impact of estimated bad debts on financial statements.
- Analyze the treatment of accounts receivable and medical supplies purchases under the conservatism principle.
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