Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

Identify income items which should not be included in the determination of the performance indicator by a hospital in its Statement of Operations.

Accepted Answer

a) Transactions with the owners, other t

Question 3

The AICPA Audit and Accounting Guide: Health Care Organizations provides reporting requirements for all of the following organizations except:

Accepted Answer

A)  The University of Virginia Hospital, a government-owned hospital. 
B)  A psychiatrist operating as a limited liability corporation. 
C)  A nursing home operated by the Lutheran Church. 
D)  Voluntary health and welfare organizations 
A)  The University of Virginia Hospital, a government-owned hospital. 
B)  A psychiatrist operating as a limited liability corporation. 
C)  A nursing home operated by the Lutheran Church. 
D)  Voluntary health and welfare organizations

Question 4

Investment income related to Assets Whose Use Is Limited amounted to $15,000 for St, Mary's Hospital, is a not-for-profit business oriented hospital. The hospital's board designated the money for future capital improvements. What is the journal entry to record this event?

Accepted Answer

D
Explanation: The journal entry would b

Question 5

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?

Accepted Answer

A)  Receipt of temporarily or permanently restricted contributions. 
B)  Items requiring separate display such as extraordinary items, discontinued operations, and the effect of changes in accounting principle. 
C)  Premium revenue. 
D)  None of the above. 
A)  Receipt of temporarily or permanently restricted contributions. 
B)  Items requiring separate display such as extraordinary items, discontinued operations, and the effect of changes in accounting principle. 
C)  Premium revenue. 
D)  None of the above.

Question 6

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?

Accepted Answer

A)  Revenues: $ 40,000; Provision for Bad Debt: 40,000. 
B)  Revenues: $ 40,000; Provision for Bad Debt: 30,000. 
C)  Revenues: $ 30,000; Provision for Bad Debt: 30,000. 
D)  Revenues: $ 0; Provision for Bad Debt: 0. 
A)  Revenues: $ 40,000; Provision for Bad Debt: 40,000. 
B)  Revenues: $ 40,000; Provision for Bad Debt: 30,000. 
C)  Revenues: $ 30,000; Provision for Bad Debt: 30,000. 
D)  Revenues: $ 0; Provision for Bad Debt: 0.

Question 7

A private sector not-for-profit hospital received a gift of $200,000 cash on the first day of 2017 with a donor restriction that the resources be used to purchase certain equipment. The equipment was purchased on the same day and is expected to last ten years with no salvage value. The Statement of Financial Position as of December 31, 2017 would reflect as net assets of:

Accepted Answer

A)  $200,000 unrestricted and $0 temporarily restricted. 
B)  $0 unrestricted and $200,000 temporarily restricted. 
C)  Either a or b, depending on the policy of the hospital. 
D)  None of the above. 
A)  $200,000 unrestricted and $0 temporarily restricted. 
B)  $0 unrestricted and $200,000 temporarily restricted. 
C)  Either a or b, depending on the policy of the hospital. 
D)  None of the above.

Question 8

Which of the following organizations must follow GASB standards?

Accepted Answer

A)  Not-for-Profit Business-Oriented Organizations 
B)  Investor-Owned Health Care Enterprises 
C)  Not-for-Profit Nonbusiness-Oriented Organizations. 
D)  Governmental Health Care Organizations 
A)  Not-for-Profit Business-Oriented Organizations 
B)  Investor-Owned Health Care Enterprises 
C)  Not-for-Profit Nonbusiness-Oriented Organizations. 
D)  Governmental Health Care Organizations

Question 9

Which of the following is/are true with respect to health care organizations?

Accepted Answer

A)  Expenses must be reported using their natural classifications. 
B)  Assets that have limited use are temporarily restricted on the balance sheet. 
C)  Private sector not-for-profits health care entities must disclose expenses by functional classifications, if not provided in the Statement of Operations. 
D)  All of the above are true. 
A)  Expenses must be reported using their natural classifications. 
B)  Assets that have limited use are temporarily restricted on the balance sheet. 
C)  Private sector not-for-profits health care entities must disclose expenses by functional classifications, if not provided in the Statement of Operations. 
D)  All of the above are true.

Question 10

Which of the following is  not  true regarding financial reporting of health care entities?

Accepted Answer

A)  It is important to distinguish between current and noncurrent assets and liabilities. 
B)  Private sector organizations use a three-category format for the Statement of Cash Flows, and public sector organizations us a four-category format. 
C)  Private sector organizations use accrual accounting, while public sector organizations use modified accrual. 
D)  It is important to distinguish operating revenues and expenses from nonoperating. 
A)  It is important to distinguish between current and noncurrent assets and liabilities. 
B)  Private sector organizations use a three-category format for the Statement of Cash Flows, and public sector organizations us a four-category format. 
C)  Private sector organizations use accrual accounting, while public sector organizations use modified accrual. 
D)  It is important to distinguish operating revenues and expenses from nonoperating.

Question 11

Which of the following is not correct with respect to reporting of patient service revenue for health care organizations?

Accepted Answer

A)  Patient service revenue does not include amounts representing charity care. 
B)  Changes to estimates of contractual adjustments related to prior periods must be reported as a prior period adjustment if material. 
C)  Unrestricted bequests and investment income for current unrestricted purposes may be reported as either operating or nonoperating revenue, depending on the policy of the entity. 
D)  Patient service revenue must be reported net of estimated adjustments for contractual adjustments. 
A)  Patient service revenue does not include amounts representing charity care. 
B)  Changes to estimates of contractual adjustments related to prior periods must be reported as a prior period adjustment if material. 
C)  Unrestricted bequests and investment income for current unrestricted purposes may be reported as either operating or nonoperating revenue, depending on the policy of the entity. 
D)  Patient service revenue must be reported net of estimated adjustments for contractual adjustments.

Question 12

The Health Care Guide makes a distinction between a health care organization and a voluntary welfare organization. Which of the following is accurate?

Accepted Answer

A)  If essentially all revenues from services are provided by contributions or grants, they are a health care organization subject to The Health Care Guide 
B)  If essentially all revenues from services provided to patients or clients they are a health care organization subject to the Health Care Guide. 
C)  If essentially all revenues from services are provided by contributions or grants, The Health Care Guide calls these organizations Not-for-Profit Business Oriented Organizations. 
D)  If essentially all revenues from services provided to patients or clients they are called Not-for-Profit Nonbusiness-Oriented Organizations. 
A)  If essentially all revenues from services are provided by contributions or grants, they are a health care organization subject to The Health Care Guide 
B)  If essentially all revenues from services provided to patients or clients they are a health care organization subject to the Health Care Guide. 
C)  If essentially all revenues from services are provided by contributions or grants, The Health Care Guide calls these organizations Not-for-Profit Business Oriented Organizations. 
D)  If essentially all revenues from services provided to patients or clients they are called Not-for-Profit Nonbusiness-Oriented Organizations.

Question 13

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

Accepted Answer

A)  A high school student class volunteered to answer the telephone during the Friday night midnight shift. 
B)  An architect developed building plans for a new outpatient clinic. 
C)  Both a) and b) above. 
D)  Neither a) nor b) above. 
A)  A high school student class volunteered to answer the telephone during the Friday night midnight shift. 
B)  An architect developed building plans for a new outpatient clinic. 
C)  Both a) and b) above. 
D)  Neither a) nor b) above.

Question 14

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

Accepted Answer

A)  All expenses are considered reductions in unrestricted net assets. 
B)  Expenses must be reported by natural i.e. salaries, supplies, etc. classification in the statements. 
C)  Both a and b above. 
D)  Neither a nor b above. 
A)  All expenses are considered reductions in unrestricted net assets. 
B)  Expenses must be reported by natural i.e. salaries, supplies, etc. classification in the statements. 
C)  Both a and b above. 
D)  Neither a nor b above.

Question 15

Which of the following is a required statement for a governmental hospital?

Accepted Answer

A)  Statement of Cash Flows. 
B)  Statement of Revenues and Expenditures. 
C)  Statement of Functional Expense. 
D)  Statement of Changes in Fund Balance. 
A)  Statement of Cash Flows. 
B)  Statement of Revenues and Expenditures. 
C)  Statement of Functional Expense. 
D)  Statement of Changes in Fund Balance.

Question 16

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?

Accepted Answer

a) Health care entities are required to

Question 17

A private sector, not-for-profit hospital received a pledge of $100,000 in 2016, with no purpose restriction. The pledge card indicated that the funds were to be paid and used in 2017. Cash was turned over to the hospital in 2017. The not-for-profit hospital would recognize contribution revenue in:

Accepted Answer

A)  When the funds are expended. 
B)  2016. 
C)  2017. 
D)  Either 2016 or 2017, depending on the policy of the hospital. 
A)  When the funds are expended. 
B)  2016. 
C)  2017. 
D)  Either 2016 or 2017, depending on the policy of the hospital.

Question 18

According to AICPA Health Care Guide, which of the following should not be included in the determination of a performance indicator for a health care organization?

Accepted Answer

A)  Transfers among affiliated organizations. 
B)  Receipt of temporarily or permanently restricted contributions. 
C)  Transactions with the owners, other than in exchange for services. 
D)  All of the above should be excluded. 
A)  Transfers among affiliated organizations. 
B)  Receipt of temporarily or permanently restricted contributions. 
C)  Transactions with the owners, other than in exchange for services. 
D)  All of the above should be excluded.

Question 19

Investor owned health care organizations have the following equity section accounts:

Accepted Answer

A)  Paid in capital and retained earnings. 
B)  Restricted and unrestricted net assets. 
C)  Unrestricted, temporarily restricted, and permanently restricted net assets. 
D)  Net Investment in Capital Assets, Restricted, and Unrestricted Net Position. 
A)  Paid in capital and retained earnings. 
B)  Restricted and unrestricted net assets. 
C)  Unrestricted, temporarily restricted, and permanently restricted net assets. 
D)  Net Investment in Capital Assets, Restricted, and Unrestricted Net Position.

Question 20

Unlike Investor-owned health care enterprises, not-for-profit business-oriented organizations and governmental health care enterprises must include RSI other than MD&A.

Accepted Answer

A) True 
 B)False

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

Identify income items which should not be included in the determination of the performance indicator by a hospital in its Statement of Operations.

The AICPA Audit and Accounting Guide: Health Care Organizations provides reporting requirements for all of the following organizations except:

Investment income related to Assets Whose Use Is Limited amounted to $15,000 for St, Mary's Hospital, is a not-for-profit business oriented hospital. The hospital's board designated the money for future capital improvements. What is the journal entry to record this event?

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?

Which of the following organizations must follow GASB standards?

Which of the following is/are true with respect to health care organizations?

Which of the following is not true regarding financial reporting of health care entities?

Which of the following is not correct with respect to reporting of patient service revenue for health care organizations?

The Health Care Guide makes a distinction between a health care organization and a voluntary welfare organization. Which of the following is accurate?

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

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

Which of the following is a required statement for a governmental hospital?

A private sector, not-for-profit hospital received a pledge of $100,000 in 2016, with no purpose restriction. The pledge card indicated that the funds were to be paid and used in 2017. Cash was turned over to the hospital in 2017. The not-for-profit hospital would recognize contribution revenue in:

According to AICPA Health Care Guide, which of the following should not be included in the determination of a performance indicator for a health care organization?

Investor owned health care organizations have the following equity section accounts:

Unlike Investor-owned health care enterprises, not-for-profit business-oriented organizations and governmental health care enterprises must include RSI other than MD&A.

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Proprietary Funds

Fiduciary Funds, Interfund Transactions

Government-Wide Statements: Capital Assets; Long-Term Debt

Advanced Topics for State and Local Governments

Accounting for Private Not-For-Profit Organizations

College and University Accounting

Auditing, Tax-exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

Filters

Exam 12: Accounting for Hospitals and Other Health Care Providers

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

Identify income items which should not be included in the determination of the performance indicator by a hospital in its Statement of Operations.

The AICPA Audit and Accounting Guide: Health Care Organizations provides reporting requirements for all of the following organizations except:

Investment income related to Assets Whose Use Is Limited amounted to $15,000 for St, Mary's Hospital, is a not-for-profit business oriented hospital. The hospital's board designated the money for future capital improvements. What is the journal entry to record this event?

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?

Which of the following organizations must follow GASB standards?

Which of the following is/are true with respect to health care organizations?

Which of the following is not true regarding financial reporting of health care entities?

Which of the following is not correct with respect to reporting of patient service revenue for health care organizations?

The Health Care Guide makes a distinction between a health care organization and a voluntary welfare organization. Which of the following is accurate?

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

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

Which of the following is a required statement for a governmental hospital?

A private sector, not-for-profit hospital received a pledge of $100,000 in 2016, with no purpose restriction. The pledge card indicated that the funds were to be paid and used in 2017. Cash was turned over to the hospital in 2017. The not-for-profit hospital would recognize contribution revenue in:

According to AICPA Health Care Guide, which of the following should not be included in the determination of a performance indicator for a health care organization?

Investor owned health care organizations have the following equity section accounts:

Unlike Investor-owned health care enterprises, not-for-profit business-oriented organizations and governmental health care enterprises must include RSI other than MD&A.

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Accounting for Other Governmental Fund Types: Capital Projects, Debt Service, and Permanent

Proprietary Funds

Fiduciary Funds, Interfund Transactions

Government-Wide Statements: Capital Assets; Long-Term Debt

Advanced Topics for State and Local Governments

Accounting for Private Not-For-Profit Organizations

College and University Accounting

Auditing, Tax-exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

Filters