Healthcare Finance: An Introduction to Accounting and Financial Management
6th Edition
ISBN: 9781567937411
Author: Louis C. Gapenski, Kristin L. Reiter
Publisher: Health Administration Press
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Question
Chapter 3, Problem 3.9P
(a)
To determine
Introduction: Income statement is a statement which presents the revenues and expenses of the company in a structured way to reflect the net income/loss earned the company.While preparing income statement, contractual discounts & allowances are deducted from revenue because it is not received from the customers.
To construct: The revenue section of IP&A Co. income statement for the year ended December 31, 2015.
(b)
To determine
To find: The effect of misstatement of contractual discounts and allowances on Net patient service revenue Total expenses including income tax expense and Net income.
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Below is a list of accounts for Currie Hospital for December 2013 (annual amounts). Prepare a statement of operations for 2013 in good form.
Account Amount
Administrative expenses $80,000
Net assets released from temporarily restricted accounts for operations 120,000
Labor expense 260,000
Interest expense 12,000
Net patient service revenue 840,000
Supply expense 88,000
Transfer to parent corporation 10,000
Bad debt expense 40,000
Depreciation expense 50,000
Accounting for patient service revenue
Ruby Ruth Hospital had the following transactions during the year ended December 31:1. The hospital provided services to patients insured by third-party payer A amounting to $9.0 millionat its established billing rates. The hospital’s prospective billing arrangement with this third partystipulates payment to the hospital of 70 percent of its established rates for services performed.All billings were paid during the year.2. The hospital provided services to patients insured by third-party payer B amounting to $5.4 millionat its established billing rates. Its retrospective billing arrangement with this third party stipulatesthat the hospital should receive payment at an interim rate of 90 percent of its established rates,subject to retrospective adjustment based on agreed-upon allowable costs. By year-end, B had paidall the billings. Before issuing its financial statements, the hospital estimated that the probableamount it will need to refund to B…
Consider this balance sheet:
Green Valley Nursing Home, Inc.
Balance Sheet
December 31, 2015
Current Liabilities:
Accounts payable
Accrued expenses
Notes payable
Total current liabilities
Assets
Long-term debt
Current Assets:
Cash
Short-term investments
Net patient accounts receivable
Supplies
Total current assets
Property and equipment
$ 105,737
Total liabilities
Shareholders' Equity:
200,000
215,600
Common stock, $10 par value
Retained earnings
87,655
$ 608,992
Less accumulated depreciation
$2,250,000
356,000
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Liabilities and Shareholders'
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Total shareholders' equity
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$
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192,900
180,000
EXHIBIT 4.1
Sunnyvale
Clinic:
Balance Sheets
December 31,
2015 and 2014
$ 445,150
1,700,000
$2,145,150
$ 100,000
(in thousands)
257,842
$ 357,842
$2,502,992
a. How does this balance sheet differ from the ones presented in
Exhibit 4.1 and Problem 4.5?
b. What is Green Valley's net working…
Chapter 3 Solutions
Healthcare Finance: An Introduction to Accounting and Financial Management
Ch. 3 - Prob. 1.1STQCh. 3 - Prob. 1.2STQCh. 3 - Prob. 2.1STQCh. 3 - Prob. 2.2STQCh. 3 - Prob. 2.3STQCh. 3 - Prob. 3.1STQCh. 3 - Prob. 3.2STQCh. 3 - Prob. 3.3STQCh. 3 - Prob. 3.4STQCh. 3 - Prob. 3.5STQ
Ch. 3 - Prob. 4.1STQCh. 3 - Prob. 4.2STQCh. 3 - Prob. 4.3STQCh. 3 - Prob. 5.1STQCh. 3 - Prob. 5.2STQCh. 3 - Prob. 5.3STQCh. 3 - Prob. 6.1STQCh. 3 - Prob. 6.2STQCh. 3 - Prob. 7.1STQCh. 3 - Prob. 7.2STQCh. 3 - Prob. 7.3STQCh. 3 - Prob. 8.1STQCh. 3 - Prob. 8.2STQCh. 3 - Prob. 8.3STQCh. 3 - Prob. 8.4STQCh. 3 - Prob. 9.1STQCh. 3 - Prob. 9.2STQCh. 3 - Prob. 9.3STQCh. 3 - Prob. 10.1STQCh. 3 - Prob. 10.2STQCh. 3 - Prob. 11.1STQCh. 3 - Prob. 11.2STQCh. 3 - Prob. 12.1STQCh. 3 - Prob. 12.2STQCh. 3 - Prob. 12.3STQCh. 3 - Prob. 13.1STQCh. 3 - Prob. 13.2STQCh. 3 - Prob. 13.3STQCh. 3 - Prob. 13.4STQCh. 3 - Prob. 14.1STQCh. 3 - Prob. 14.2STQCh. 3 - Prob. 14.3STQCh. 3 - Prob. 15.1STQCh. 3 - Prob. 15.2STQCh. 3 - Prob. 16.1STQCh. 3 - Prob. 16.2STQCh. 3 - Prob. 3.1QCh. 3 - Prob. 3.2QCh. 3 - Prob. 3.3QCh. 3 - Prob. 3.4QCh. 3 - Prob. 3.5QCh. 3 - Prob. 3.6QCh. 3 - Prob. 3.7QCh. 3 - Prob. 3.8QCh. 3 - Prob. 3.9QCh. 3 - Prob. 3.1PCh. 3 - Prob. 3.2PCh. 3 - Prob. 3.3PCh. 3 - Prob. 3.4PCh. 3 - Prob. 3.5PCh. 3 - Prob. 3.6PCh. 3 - Prob. 3.7PCh. 3 - Prob. 3.8PCh. 3 - Prob. 3.9P
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