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1. Prepare the journal entries for December 2023. Assume 15 percent of the amounts billed to patients will be reduced through Implicit price adjustments. 2. Prepare the journal entries for 2024 assuming the following: a. $123,000 is collected from the patients during the year, and $11,800 of price adjustments are granted to Individuals. b. Actual contractual adjustments total $229,000. The remaining receivable from third-party payors is collected. Note: For all requirements, If no entry is required for a transaction or event, select "No Journal Entry Required" In the first account field. No Transaction A Answer is not complete. General Journal Revenues-Without Donor Restrictions-Patient Service Revenue Patient Accounts Receivable-Patients Patient Accounts Receivable-3rd Party Payors Debit Credit 1,330,000 220,000 1,110,000 B 1b Patient Accounts Receivable-3rd Party Payors × 222,000 Allowance for Contractual Adjustments 0 220,000 с 1c D 2a Provision for Implicit Price Adjustments Allowance for Implicit Price Adjustments Cash Patient Accounts Receivable-Patients 33,000- 0 33,000 Ο 123,000 123,000 E 261 Allowance for Contractual Adjustments Allowance for Contractual Adjustments F 262 Cash Patient Accounts Receivable-3rd Party Payors 229,000 0 229,000 881,000 881,000 *

1. Prepare the journal entries for December 2023. Assume 15 percent of the amounts billed to patients will be reduced through Implicit price adjustments. 2. Prepare the journal entries for 2024 assuming the following: a. $123,000 is collected from the patients during the year, and $11,800 of price adjustments are granted to Individuals. b. Actual contractual adjustments total $229,000. The remaining receivable from third-party payors is collected. Note: For all requirements, If no entry is required for a transaction or event, select "No Journal Entry Required" In the first account field. No Transaction A Answer is not complete. General Journal Revenues-Without Donor Restrictions-Patient Service Revenue Patient Accounts Receivable-Patients Patient Accounts Receivable-3rd Party Payors Debit Credit 1,330,000 220,000 1,110,000 B 1b Patient Accounts Receivable-3rd Party Payors × 222,000 Allowance for Contractual Adjustments 0 220,000 с 1c D 2a Provision for Implicit Price Adjustments Allowance for Implicit Price Adjustments Cash Patient Accounts Receivable-Patients 33,000- 0 33,000 Ο 123,000 123,000 E 261 Allowance for Contractual Adjustments Allowance for Contractual Adjustments F 262 Cash Patient Accounts Receivable-3rd Party Payors 229,000 0 229,000 881,000 881,000 *

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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St. Joseph's Hospital began operations in December 2023 with patient service revenues totaling $1,330,000 (based on customary rates) for the month. Of this, $220,000 is billed to patients, representing their Insurance deductibles and copayments. The balance is billed to third-party payors, including Insurance companies and government health care agencies. St. Joseph's estimates that 20 percent of these third-party payor charges will be deducted by contractual adjustment. The hospital's fiscal year ends on December 31. Required: 1. Prepare the journal entries for December 2023. Assume 15 percent of the amounts billed to patients will be reduced through Implicit price adjustments. 2. Prepare the journal entries for 2024 assuming the following: a. $123,000 is collected from the patients during the year, and $11,800 of price adjustments are granted to Individuals. b. Actual contractual adjustments total $229,000. The remaining receivable from third-party payors is collected. Note: For all requirements, if no entry is required for a transaction or event, select "No Journal Entry Required" In the first account field. Answer is not complete. A No Transaction 1a B 1b General Journal Revenues-Without Donor Restrictions-Patient Service Revenue Patient Accounts Receivable-Patients Patient Accounts Receivable-3rd Party Payors Patient Accounts Receivable-3rd Party Payors Allowance for Contractual Adjustments × * 0 0 Debit Credit 1,330,000 220,000 1,110,000 222,000 220,000 с 1c Provision for Implicit Price Adjustments 0 33,000 Allowance for Implicit Price Adjustments 0 33,000 D 2a Cash 0 123,000 Patient Accounts Receivable-Patients * 123,000 E 261 Allowance for Contractual Adjustments Allowance for Contractual Adjustments Patient Accounts Receivable-3rd Party Payors F 262 Cash > > > ☑ 229,000 229,000 881,000 881,000
Transcribed Image Text:St. Joseph's Hospital began operations in December 2023 with patient service revenues totaling $1,330,000 (based on customary rates) for the month. Of this, $220,000 is billed to patients, representing their Insurance deductibles and copayments. The balance is billed to third-party payors, including Insurance companies and government health care agencies. St. Joseph's estimates that 20 percent of these third-party payor charges will be deducted by contractual adjustment. The hospital's fiscal year ends on December 31. Required: 1. Prepare the journal entries for December 2023. Assume 15 percent of the amounts billed to patients will be reduced through Implicit price adjustments. 2. Prepare the journal entries for 2024 assuming the following: a. $123,000 is collected from the patients during the year, and $11,800 of price adjustments are granted to Individuals. b. Actual contractual adjustments total $229,000. The remaining receivable from third-party payors is collected. Note: For all requirements, if no entry is required for a transaction or event, select "No Journal Entry Required" In the first account field. Answer is not complete. A No Transaction 1a B 1b General Journal Revenues-Without Donor Restrictions-Patient Service Revenue Patient Accounts Receivable-Patients Patient Accounts Receivable-3rd Party Payors Patient Accounts Receivable-3rd Party Payors Allowance for Contractual Adjustments × * 0 0 Debit Credit 1,330,000 220,000 1,110,000 222,000 220,000 с 1c Provision for Implicit Price Adjustments 0 33,000 Allowance for Implicit Price Adjustments 0 33,000 D 2a Cash 0 123,000 Patient Accounts Receivable-Patients * 123,000 E 261 Allowance for Contractual Adjustments Allowance for Contractual Adjustments Patient Accounts Receivable-3rd Party Payors F 262 Cash > > > ☑ 229,000 229,000 881,000 881,000
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