Dublin State Hospital would have earned $3,000,000 of patient service revenue under its established rate structure for the year. However, it does not expect to collect this amount due to charity allowances of $75,000, discounts to third-party payers of $200,000, and an estimated uncollectible amount of $50,000. For the year, how much should Dublin State Hospital report as patient service revenue?

Question

Quizplus · Accepted Answer

Dublin State Hospital should report patient service revenue net of charity allowances, discounts to third-party payers, and estimated uncollectible amounts. Therefore, the calculation is $3,000,000 - $75,000 (charity allowances) - $200,000 (discounts to third-party payers) - $50,000 (estimated uncollectible amount) = $2,675,000.

Dublin State Hospital Would Have Earned $3,000,000 of Patient Service