Exam 14: Health Care Providers

For a not-for-profit hospital, which of the following financial statements is NOT required?

Gamma Hospital is a recipient of Hill-Burton funds and must provide some hospital care for which it will not be compensated.During the current year, the hospital provided $1 million in charity care.Discuss the following questions. a.What is the current financial reporting requirement for charity care? b.Do you agree or disagree with the current financial reporting requirement? Why or why not? c.If you do not agree with the current financial reporting requirement, how do you think charity care should be reported? d.Alternatively, if you do agree with the current standards, what alternative reporting requirements do you believe would be proposed by those who do not agree with the current standards?

Which of the following would normally be considered ongoing or central transactions for a not-for-profit hospital?

A not-for-profit hospital signs a contract with an insurance company in which the company agrees to pay the hospital $9 million in capitation fees for the year July 1, 2017, through June 30, 2018.Between July 1, 2017 and December 31, 2017, the hospital provides services that, at its standard rates, would bill at $5.1 million.Between January 1, 2017, and June 30, 2018, it provides services that it would bill at $4.2 million.For the year ending December 31, 2017, the hospital should recognize capitation revenue of

Moore Art Association, a not-for-profit entity, received a cash gift of $10 million.The association trustees decided to use the gift to establish a permanent endowment for the association.The income from the endowment would be used to provide grants to promising sculptors and students of the history of sculpture.The association should report the gift as an increase in

Not-for-profit hospitals are accounted for similarly to businesses but must adhere to the FASB's standards for not-for-profit entities.

The Medical Arts Clinic, a well-established health care organization, received a $1,500,000 pledge in fiscal year 2018 that was restricted to cover operating expenses.The gift was received over two years; $600,000 in the first year and $900,000 in the second year.The following table reflects the funds received as well as the amounts spent on operating the clinic. What should the clinic report as Net Assets Released from Restrictions on the statement of activities for the fiscal year ended June 30, 2019?