Exam 12: Accounting for Hospitals and Other Health Care Providers

The AICPA Health Care Guide provides accounting and reporting requirements that override GASB and FASB standards,but apply only to health care providers.

Both governmental owned and private health care providers use the modified accrual basis of accounting and the economic resources measurement focus.

According to the AICPA Audit and Accounting Guide: Health Care Organizations,which of the following items should be included in the determination of the performance indicator?

Both commercial and not-for-profit hospitals in the private sector follow FASB standards.

Answer the following questions: (a)Other than a Statement of Financial Position (i.e.balance sheet),what are the remaining financial statements required of private not-for-profit health care entities? (b)What accounts appear in the equity section of the balance sheet of commercial hospitals,government owned hospitals,and private not-for-profit hospitals?

Patient service revenue for a hospital does not include charges for charity care.

Which of the following could be recognized as contributed services revenue by a not-for-profit hospital?

Like charities and private colleges,private not-for-profit health care organizations follow FASB standards.

For hospitals,contractual adjustments to 3^rd party payers,such as insurance companies,are recorded with a debit to Contractual Adjustments (a contra-revenue account)and a credit to an allowance for contractual adjustments.

According to The AICPA Health Care Guide,transfers among affiliated organizations should be included in the determination of a performance indicator for a health care organization.

As both the FASB and the GASB approved the AICPA Health Care Guide,its requirements constitute Category B GAAP and must be followed by all health care organizations.

With respect to health care organizations,expenses must be reported using their natural classifications.

The equity section of the Statement of Net Assets of a private not-for-profit hospital may contain which of the following descriptions?

Private not-for-profit health care organizations follow standards set by:

Which of the following is not a required statement of a private not-for-profit hospital?

The AICPA Audit and Accounting Guide: Health Care Organizations applies to:

A hospital reported the following uncollectible amounts: $ 10,000 for services rendered to homeless individuals with no intention of collection. $ 30,000 for services rendered with the expectation of collection,but which proved to be uncollectible. What amount should be reported in revenues and provision for bad debt for these items?

Differences between actual and estimated contractual adjustments are treated as changes in accounting estimates.

Which of the following is true regarding the reporting of expenses by private sector,not-for-profit hospitals?

Private for-profit health care organizations follow FASB standards excluding those written specifically for not-for-profits.