E16-19 Revenue and Related Transactions [LO 16-4] During its current fiscal year
ID: 2532256 • Letter: E
Question
E16-19 Revenue and Related Transactions [LO 16-4] During its current fiscal year, Evanston 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 $9,696,000, of which $458,000 was for charity care, $936,000 was paid by uninsured patients, and $8,302,000 was billed to Medicare, 2. Donated pharmaceuticals and medical supplies valued at $273,000 were received and utilized as 3. Medicare, Medicaid, and third-party payors (insurance companies) approved and paid $5,373,000 of the 4. An unconditional contribution of $5,080,000 was received in cash from a donor to construct a new facility 5. A total of $1,069,000 was received from the following activities/sources: cafeteria and gift shop sales, Medicaid, and insurance companies. general expenses $8,302,000 billed by the hospital during the year (see transaction 1) for care of Alzheimers patients. The full amount is expendable for that purpose. No activity occurred on this project during the current year. $790,000; medical seminars, $133,000; unrestricted transfers from the Evanston General Hospital Foundation, $83,000; and fees for medical transcripts, $63,000. 6. Uncollectible accounts totaling $4,050 were written off. The allowance for uncollectible receivables was increased by $5,170 0 Required a. Prepare journal entries for the preceding transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)Explanation / Answer
Revenue related transactions- Charity services to patients $ 458,000 payment against Charity services to patients $ - services to uninsured patients $ 936,000 paid by uninsured patients $ 936,000 services to insured patients $ 8,302,000 Approved payments against services to insured patients $ 5,373,000 Donations- supplies and pharma $ 273,000 general expense- supplies and pharma $ 273,000 Café and gift shop sales $ 790,000 seminar $ 133,000 fees for transcripts $ 63,000 Donations- Evanston Foundation $ 83,000 write off $ 4,050 $ 9,969,000 $ 7,651,000 Unrestricted revenues Net patient service $ (3,387,000) Less provision for bad debts $ (5,170) Other revenue $ 1,069,000
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