Question 1

Contractual Adjustments is properly characterized as

Accepted Answer

A)  An expense.
B)  An other financing use.
C)  A liability.
D)  A deduction from revenues. D

Question 2

Assets set aside by the governing board for the eventual construction of a hospital addition should be recorded as "assets limited as to use".

Accepted Answer

A) True 
 B)False  True

Question 3

A contribution that is restricted by the donor to be held in perpetuity and for which the investment income can be spent at the discretion of a nongovernmental,not-for-profit hospital's governing board,will be reported as an increase to

Accepted Answer

A)  Permanent funds.
B)  Current restricted funds.
C)  Permanently restricted net assets.
D)  Specific purpose assets. C

Question 4

An expense for diabetes research that was financed by temporarily restricted contributions would be recorded as a decrease of unrestricted net assets by a not-for-profit health care organization.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following would usually be considered as temporarily restricted net assets in a nongovernmental not-for-profit hospital?

Accepted Answer

A)  Investment income.
B)  Donated services by senior citizens.
C)  A permanent endowment received from the city's leading citizen.
D)  A research grant from the federal government to study high blood pressure.

Question 6

Long-term debt related to a construction project in a public hospital that follows business-type accounting should be reported as other financing sources.

Accepted Answer

A) True 
 B)False

Question 7

Independent health care organizations that associate for the specific purpose of obtaining financing are called a(an)

Accepted Answer

A)  Consolidation.
B)  Obligated group.
C)  Affiliation.
D)  Joint venture.

Question 8

When a governmental hospital purchases capital assets from resources restricted by donors for that purpose,the net assets account Net Assets-Invested in Capital Assets,Net of Related Debt is increased.

Accepted Answer

A) True 
 B)False

Question 9

All health care entities recognize all revenues and expenses on the accrual basis of accounting.

Accepted Answer

A) True 
 B)False

Question 10

Explain how one can evaluate both the financial performance of a hospital and the quality of health care the hospital provides.

Accepted Answer

The answer of Explain how one can evaluate both the...

Question 11

Which of the following kinds of volunteer service is most likely to be reported by a private hospital as contribution revenue and an expense?

Accepted Answer

A)  Community members who plant flowers on the grounds once a year in the spring.
B)  Volunteers in the gift shop who work a few hours a day serving customers.
C)  Nurses from a religious organization who volunteer to assist in the care of critically ill children.
D)  An accountant who is a member of the board of directors.

Question 12

Describe what prepaid health care plans are and some of the related accounting issues.

Accepted Answer

The answer of Describe what prepaid health care plans are...

Question 13

Endowment income expended by a not-for-profit health care organization for purposes specified by the donor should be recorded as a decrease in temporarily restricted net assets using the account Net Assets Released from Restrictions.

Accepted Answer

A) True 
 B)False

Question 14

The goal of financial and operational analysis of a health care organization is to determine if the entity is profitable.

Accepted Answer

A) True 
 B)False

Question 15

A gift to a hospital with the restriction that the principal be maintained intact for ten years and then it may be expended would be an example of a term endowment.

Accepted Answer

A) True 
 B)False

Question 16

Health care is provided by organizations that may be for-profit,not-for-profit,or governmental; although roughly half of all health care is provided by not-for-profit entities.

Accepted Answer

A) True 
 B)False

Question 17

Contrast and compare the statement of cash flows that nongovernmental not-for-profit hospitals prepare to those that governmental hospitals prepare.

Accepted Answer

The answer of Contrast and compare the statement of cash...

Question 18

Continuing care retirement communities (CCRC)provide residential care in a facility,along with some level of long-term medical care that is less intensive that hospital care.

Accepted Answer

A) True 
 B)False

Question 19

Patient service revenues and related receivables include charges for charity care services.

Accepted Answer

A) True 
 B)False

Question 20

Financial reporting standards for all government owned and operated hospitals are established by the GASB.

Accepted Answer

A) True 
 B)False

Exam 17: Accounting and Reporting for the Federal Government

Contractual Adjustments is properly characterized as

Assets set aside by the governing board for the eventual construction of a hospital addition should be recorded as "assets limited as to use".

A contribution that is restricted by the donor to be held in perpetuity and for which the investment income can be spent at the discretion of a nongovernmental,not-for-profit hospital's governing board,will be reported as an increase to

An expense for diabetes research that was financed by temporarily restricted contributions would be recorded as a decrease of unrestricted net assets by a not-for-profit health care organization.

Which of the following would usually be considered as temporarily restricted net assets in a nongovernmental not-for-profit hospital?

Long-term debt related to a construction project in a public hospital that follows business-type accounting should be reported as other financing sources.

Independent health care organizations that associate for the specific purpose of obtaining financing are called a(an)

When a governmental hospital purchases capital assets from resources restricted by donors for that purpose,the net assets account Net Assets-Invested in Capital Assets,Net of Related Debt is increased.

All health care entities recognize all revenues and expenses on the accrual basis of accounting.

Explain how one can evaluate both the financial performance of a hospital and the quality of health care the hospital provides.

Which of the following kinds of volunteer service is most likely to be reported by a private hospital as contribution revenue and an expense?

Describe what prepaid health care plans are and some of the related accounting issues.

Endowment income expended by a not-for-profit health care organization for purposes specified by the donor should be recorded as a decrease in temporarily restricted net assets using the account Net Assets Released from Restrictions.

The goal of financial and operational analysis of a health care organization is to determine if the entity is profitable.

A gift to a hospital with the restriction that the principal be maintained intact for ten years and then it may be expended would be an example of a term endowment.

Health care is provided by organizations that may be for-profit,not-for-profit,or governmental; although roughly half of all health care is provided by not-for-profit entities.

Contrast and compare the statement of cash flows that nongovernmental not-for-profit hospitals prepare to those that governmental hospitals prepare.

Continuing care retirement communities (CCRC)provide residential care in a facility,along with some level of long-term medical care that is less intensive that hospital care.

Patient service revenues and related receivables include charges for charity care services.

Financial reporting standards for all government owned and operated hospitals are established by the GASB.