Question

For your fictitious healthcare service,: 1. January 1, 2019: $1,000,000 is deposited by your health system into your entity account to finance the start-up of your operation. 2. February 1, 2019: You acquire equipment needed to provide services totaling $250,000. This equipment is acquired on a credit line with 0% interest. The equipment has a useful life of 10-years and a salvage value of $50,000. You use straight-line depreciation. 3. March 1, 2019: You purchase $100,000 of supplies on credit for use in caring for your patients. 4. April 1, 2019: All of your budgeted staff members begin working. They are paid on a monthly basis, with the first payroll date of April 1, 2019. Each payroll date occurs on the 1st of each month. 5. May 1, 2019 through December 31, 2019: You begin accepting your first patients. You provide $300,000 in healthcare services for each month through the end of the calendar year. You invoice your patients' health insurance companies on the last day of each month. 6. May 1, 2019 through December 31, 2019: You use $30,000 in supplies to provide healthcare services to your patients each month. You record the use of supplies on the last day of each month. 7. June 1, 2019: You pay your suppliers $80,000 for supplies purchased on credit. 8. July 1, 2019: You receive payments from health insurance companies totaling $250,000. 9. August 1, 2019: a. You purchase $60,000 of supplies on credit for use in caring for your patients. b. You receive payments from health insurance companies totaling $320,000 10. September 1, 2019: You receive payments from health insurance companies totaling $225,000. 11. October 1, 2019: You receive payments from health insurance companies totaling $310,000. 12. November 1, 2019: a.You receive payments from health insurance companies totaling $240,000. b. You pay your suppliers $40,000 for supplies purchased on credit. 13. December 1, 2019: You receive payments from health insurance companies totaling $330,000. 14. December 15, 2019: You make a payment to your equipment financing company of $25,000. 15. December 31, 2019: How do you calculate the account receivable and cash assets?

Answer 1

Accounts Receivables
2019	Particulars	Amount	Date	Particulars	Amount
May,31	To Healthcare services	300000	July,1	By Cash	250000
June,30	To Healthcare services	300000	Aug,9	By Cash	320000
July,31	To Healthcare services	300000	Sep,1	By Cash	225000
Aug,31	To Healthcare services	300000	Oct,1	By Cash	310000
Sep,30	To Healthcare services	300000	Nov,1	By Cash	240000
Oct,31	To Healthcare services	300000	Dec,1	By Cash	330000
Nov,30	To Healthcare services	300000	Dec,31	By Bal c/d	725000
Dec,30	To Healthcare services	300000
		2400000			2400000

Cash Account
2019	Particulars	Amount	Date	Particulars	Amount
Jan,1	To Common stock	1000000
July,1	TO AR	250000	June,1	By Accounts Payable	80000
Aug,1	TO AR	320000	Nov,1	By Accounts Payable	40000
Sep,1	TO AR	225000	Dec,15	By Accounts Payable	25000
Oct,1	TO AR	310000	Dec,31	By balance c/d	1530000
Nov,1	TO AR	240000
Dec,1	TO AR	330000
		1675000			1675000
Note	We have not considered the $ 10 00 000 in Cash Asset Account
	as it is not clear whether it was cash or what ?
	Still , shown in Cash but for balance , not considered

Working notes

Note 1 - We have not been given any data for Staff Salary payment , hence no figures considered in Cash Account

Equipment
2019	Particulars	Amount	Date	Particulars	Amount
Feb,1	To Accounts payable	250000	Dec,31	By Depreciation	20000
				( 250000-50000/10)
				By Balance C/d	230000
		250000			250000
Supplies
2019	Particulars	Amount	Date	Particulars	Amount
Mar,1	To Accounts payable	100000	May,31	By Cons	30000
June,1	To Bank	80000	June,30	By Cons	30000
Aug,9	To Accounts payable	60000	July,31	By Cons	30000
			Aug,31	By Cons	30000
			Sep,30	By Cons	30000
			Oct,31	By Cons	30000
			Nov,30	By Cons	30000
			Dec,31	By Cons	30000
		240000			240000
Healthcare services
2019	Particulars	Amount	Date	Particulars	Amount
			May,31	By Account Receivables	300000
			June,30	By Account Receivables	300000
			July,31	By Account Receivables	300000
			Aug,31	By Account Receivables	300000
			Sep,30	By Account Receivables	300000
			Oct,31	By Account Receivables	300000
			Nov,30	By Account Receivables	300000
	To P&L	2400000	Dec,31	By Account Receivables	300000
		2400000			2400000

Accounts Payable
2019	Particulars	Amount	Date	Particulars	Amount
Jun-01	To bank	80000	Mar-01	By Pur	100000
Nov,12	To bank	40000	Aug,9	By Pur	60000
Dec,15	To bank	25000
Dec,31	To bal c/d	145000
		410000			410000