When accounting for health care organizations,services provided for charity care are:

Question

Quizplus · Accepted Answer

Services provided for charity care are not recorded as revenues because they are not expected to generate any inflow of cash. The costs, however, are expensed as normal because they represent legitimate costs incurred by the healthcare organization. This is consistent with the matching principle of accounting, which requires that expenses be recognized in the same period as the related revenues. Therefore, the best choice is B.

When Accounting for Health Care Organizations,services Provided for Charity Care