Multiple Choice. Choose the best answer. 1. The AICPA Audit and Accounting Guide
ID: 2462201 • Letter: M
Question
Multiple Choice. Choose the best answer. 1. The AICPA Audit and Accounting Guide Health Care Entities is consid-ered category b authoritative guidance that can be used by which of the following? a. A business-type government hospital. b. A not-for-profit hospital. c. A for-profit hospital. d. All of the above. 2. A not-for-profit hospital would present all of the following financial state-ments, except a: a . Balance sheet or statement of financial position. b . Statement of functional expenses. c . Statement of operations. d . Statement of cash flows. 3. Which of the following is a true statement regarding a performance indicator ? a. All health care organizations are required to report a performance indicator. b. Only governmental health care organizations are required to report a per-formance indicator. c. The purpose of reporting a performance indicator is to make it easier to compare the results of operations of not-for-profit health care organiza-tions to those of for-profit health care organizations. d. The purpose of reporting a performance indicator is to assist in evaluat-ing the efficiency and effectiveness of a health care organization’s oper-ating activities. 4. Fees received by a hospital for a “healthy heart” workshop offered to patients should be reported as: a. Patient service revenue. b. Administrative service revenue. c. Other revenue. d. Nonoperating gains. 5. Which of the following is an example of an asset limited as to use? a. Real estate donated to build a clinic for the homeless. b. Contributed cash that the board is considering setting aside for self-insurance. c. Investments bequeathed to the health care organization where the income is to be used to fund operating costs for a cancer clinic. d. Funds from a sale of bonds that are required by covenant to be used to build a new hospital. 6. Why are health care organizations motivated to track the actual costs of services? a. Both GASB and FASB require it. b. They must report their actual expenses, so that third-party payors will reimburse them. c. Third-party payors contract with the organization to reimburse a set amount, and the organization risks a loss if costs are greater than the amount reimbursed. d. Any amount not reimbursed by a third-party payor or paid by the patient must be included in the amount reported as charity care.Explanation / Answer
1) The AICPA Audit and Accounting Guide Health Care Entities is consid-ered category b authoritative guidance that can be used by which of the following?
A business-type government hospital.
2) A not-for-profit hospital would present all of the following financial state-ments, except
c . Statement of operations.
3) Which of the following is a true statement regarding a performance indicator ?
d. The purpose of reporting a performance indicator is to assist in evaluat-ing the efficiency and effectiveness of a health care organization’s oper-ating activities
4) Fees received by a hospital for a “healthy heart” workshop offered to patients should be reported as
c. Other revenue.
5) 5. Which of the following is an example of an asset limited as to use?
b. Contributed cash that the board is considering setting aside for self-insurance.
6) Why are health care organizations motivated to track the actual costs of services?
c. Third-party payors contract with the organization to reimburse a set amount, and the organization risks a loss if costs are greater than the amount reimbursed
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