Question

During its current fiscal year, Evanston General Hospital, a not-for-profit health care organization, had the following revenue-related transactions (amounts summarized for the year).

1.	Services provided to inpatients and outpatients amounted to $9,660,000, of which $455,000 was for charity care, $933,000 was paid by uninsured patients, and $8,272,000 was billed to Medicare, Medicaid, and insurance companies.
2.	Donated pharmaceuticals and medical supplies valued at $270,000 were received and utilized as general expenses.
3.	Medicare, Medicaid, and third-party payors (insurance companies) approved and paid $5,370,000 of the $8,272,000 billed by the hospital during the year (see transaction 1).
4.	An unconditional contribution of $5,050,000 was received in cash from a donor to construct a new facility for care of Alzheimers patients. The full amount is expendable for that purpose. No activity occurred on this project during the current year.
5.	A total of $1,030,000 was received from the following activities/sources: cafeteria and gift shop sales, $760,000; medical seminars, $130,000; unrestricted transfers from the Evanston General Hospital Foundation, $80,000; and fees for medical transcripts, $60,000.
6.	Uncollectible accounts totaling $3,750 were written off. The allowance for uncollectible receivables was increased by $3,670.

Required

a.	Prepare journal entries for the preceding transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

• 1 Services provided to inpatients and outpatients amounted to $9,660,000, of which $455,000 was for charity care, $933,000 was paid by uninsured patients, and $8,272,000 was billed to Medicare, Medicaid, and insurance companies.

• 2 Donated pharmaceuticals and medical supplies valued at $270,000 were received and utilized as general expenses.

• 3 Medicare, Medicaid, and third-party payors (insurance companies) approved and paid $5,370,000 of the $8,272,000 billed by the hospital during the year.

• 4 An unconditional contribution of $5,050,000 was received in cash from a donor to construct a new facility for care of Alzheimers patients. The full amount is expendable for that purpose. No activity occurred on this project during the current year.

• 5 A total of $1,030,000 was received from the following activities/sources: cafeteria and gift shop sales, $760,000; medical seminars, $130,000; unrestricted transfers from the Evanston General Hospital Foundation, $80,000; and fees for medical transcripts, $60,000.

• 6 Uncollectible accounts totaling $3,750 were written off.

• 7 The allowance for uncollectible receivables was increased by $3,670.

b.	Prepare the unrestricted revenues, gains, and other support section of Evanston General Hospital’s statement of operations for the current year.

     

Evanston General Hospital Statement of Operations For the Current Year Unrestricted Revenues, Gains, and Other Support: Net Patient Service Revenue Less: Provision for Bad Debts Other Revenue

Answer 1

Credit Dale pasos Journal Entries De Debit - Particolay Accounts & Notes Receivable | 8272000 933000 rest, Cash Patient Service Revenue Go record Palient service revenue General Expenses 270,000 Contributions - Unrestricted Cro record Geneeal Expenses] 4205000 2. 270,000 Cash contachal Adjustments - 5,370,000 2,902,000 Accounts & notes Receivable] 8273000 Cto record Coosh receipt &contrac- atual adjustments] cash, 5,050,000 Contributions - Temporarile mele 15,050,000 Go record Cash receipt as. restricted temporarily ] Cash 1030,000 ... other Revenues [cio record revenues ? Allowance foor Uncollectible Als 3750 Al Accounts & Noles Receivable 3750 (o record Bad debt while off) Provision for Bad debt. 13670 Allowance for Uncollectible Receivables Cro Recomand increase in allowance for bad debts] 1030,000 3670

Evanston General Hospital statement of Operations for the current year. I particolay Amount | Amount Unrestricted Revenue, Lains & other Support: Patient service Revenue 9205000 Less: Contractual Adjustment 2902,000 Net Patient Service Revenue -> 6303,000 Less: Provision for bad debts I 3670 16299,330 other Revenues: Donations 270,000 other Revenues from other source 1030000 1300,000