ACCT567 Dearborn General Hospital Problem 17–5

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ACCT567 Dearborn General Hospital Problem 17–5
During its current fiscal year, Dearborn General Hospital, a not-for-profit health care organization…

SKU: ACCT 567 Revenue and Related Transactions Problem 17-5 Categories: , Tags: , , ,

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ACCT567 Dearborn General Hospital Problem 17–5

ACCT567 Dearborn General Hospital Problem 17–5

Revenue and Related Transactions A+

During its current fiscal year, Dearborn General Hospital, a not-for-profit health care organization, had the following revenue-related transactions (amounts summarized for the year).

  1. Services provided to inpatients and outpatients amounted to $9,600,000, of which $450,000 was for charity care, $928,000 was paid by uninsured patients, and $8,222,000 was billed to Medicare, Medicaid, and insurance companies.
  2. Pharmaceutical drugs sold by the hospital pharmacy amounted to $970,000, all of which was paid by customers or insurance.
  3. Medicare, Medicaid, and third-party payors (insurance companies) approved and paid $5,365,000 of the $8,222,000 billed by the hospital during the year (see transaction 1).
  4. An unconditional contribution of $5,000,000 was received in cash from a donor to construct a new facility for care of Alzheimers patients. The full amount is expendable for that purpose. No activity occurred on this project during the current year.
  5. A total of $840,000 was received from the following activities/sources: cafeteria and gift shop sales, $710,000; unrestricted transfers from the Dearborn General Hospital Foundation, $75,000; and fees for medical transcripts, $55,000.
  6. The allowance for uncollectible receivables was increased by $1,200.

Required

  1. Record the preceding transactions in general journal form.
  2. Prepare the unrestricted revenues, gains, and other support section of Dearborn General Hospital’s statement of operations for the current year, following the format in Illustration 17–4.
  3. On which statement would restricted contributions be reported? Explain.

The citation provided is a guideline. Please check each citation for accuracy before use.

 

Problem 17-5 Preview:

DEARBORN GENERAL HOSPITAL

GENERAL JOURNAL

                                                                                                 Debits            Credits

 

  1. ACCOUNTS AND NOTES RECEIVABLE          8,222,000

CASH                                                                                   928,000

PATIENT SERVICE REVENUE                                                                9,150,000

 

  1. CASH                                                                          970,000

OTHER REVENUE          

                                                                                      ….