Question 1

Wakefield Home is a private not-for-profit healthcare organization offering services for a fee.The home has an endowment and the income may be used to sponsor families that are unable to pay for services but the principal must be preserved.In addition,various fundraising activities take place during the year.
When the Home held its annual Holiday fund raiser,pledges of $50,000 were received.The administration expected 5% to be uncollectible.
In addition,income of $10,000 was received from the endowment to sponsor families.
Prepare the journal entries for these transactions.

Accepted Answer

The answer of Wakefield Home is a private not-for-profit healthcare...

Question 2

The hospital estimated that contractual adjustments would reduce the amount collected from third-party payors to $1,710,000.
Required:
Prepare the necessary journal entry to record the contractual adjustments.

Accepted Answer

The answer of The hospital estimated that contractual adjustments would...

Question 3

For May 2008,Carlington Hospital's charges for patient services were $608,000,of which 80% was billed to third-party payors.
Required:
Prepare the journal entry to accrue patient charges for the month.

Accepted Answer

The answer of For May 2008,Carlington Hospital's charges for patient...

Question 4

A local social worker,earning $12 per hour working for the state government,contributed 600 hours of time at no charge to the Yelton Center,a voluntary health and welfare organization.Except for these donated services,an additional staff person would have been hired by the organization.
Required:
How should the Yelton Center record the contributed services?

Accepted Answer

The answer of A local social worker,earning $12 per hour...

Question 5

The Home incurred the following liabilities: $110,000 salaries,$30,000 medical equipment,$10,000 utilities expense.
Prepare the journal entries for these transactions.

Accepted Answer

The answer of The Home incurred the following liabilities: $110,000...

Question 6

According to FASB Statement 117,how are not-for-profits to utilize separate funds?

Accepted Answer

The answer of According to FASB Statement 117,how are not-for-profits...

Question 7

REFERENCE: Ref.18_04
A not-for-profit organization (Charity A)raises money for other charitable organizations.Charity A receives $10,000 to distribute to Charity B.
-Assume there are no donor rights to revoke or redirect the gift.
Prepare the journal entries for Charity A when the gift is received,and for Charity A and Charity B when the gift is distributed.

Accepted Answer

The answer of REFERENCE: Ref.18_04
A not-for-profit organization (Charity A)raises money...

Question 8

How does a not-for-profit organization record the receipt of a gift that will be transferred to another charitable organization without restrictions? What if the donor retains the right to revoke or redirect the gift?

Accepted Answer

The answer of How does a not-for-profit organization record the...

Question 9

In this month,there were several patients that had no health insurance and due to their low income level,the hospital decided that $85,000 of receivables would not be collectible
Required:
Prepare the necessary journal entry to reflect the decision to consider the $85,000 as charity care.

Accepted Answer

The answer of In this month,there were several patients that...

Question 10

REFERENCE: Ref.18_05
Wakefield Home is a private not-for-profit healthcare organization offering services for a fee.In the first quarter of 2008,Wakefield Home rendered services of $300,000 to patients.Of this amount 75% will be paid by patients,and $25,000 will be adjusted based on estimated insurance agreements.The remaining amount is to be paid by third party insurance providers.
-Record the journal entries that reflect all of this information.

Accepted Answer

The answer of REFERENCE: Ref.18_05
Wakefield Home is a private not-for-profit...

Question 11

REFERENCE: Ref.18_02
For the month of December 2008,patient charges at Northfield Hospital (a not-for-profit hospital)were $2,720,000.Third-party payors were billed $1,800,000.
-Prepare the necessary journal entry to record the revenue and receivables.

Accepted Answer

The answer of REFERENCE: Ref.18_02
For the month of December 2008,patient...

Question 12

A local business donated medical supplies to Wakefield with a value of $40,000.
Prepare the journal entry for the receipt of these supplies.

Accepted Answer

The answer of A local business donated medical supplies to...

Question 13

During 2008,the Garfield Humane Society,a voluntary health and welfare organization,received cash donations of $892,000 and membership dues of $62,000.A member of the Humane Society donated services valued at $8,000 that would otherwise have been performed by a paid staff member.A pet food manufacturer donated dog food valued at $16,400.The Humane Society received a gift of $140,000,to be used in building a new animal shelter.Also during 2008,investments held by the Humane Society earned interest of $2,000.
Required:
Prepare a schedule showing the amount that the Garfield Humane Society should have recorded for public support for 2008.

Accepted Answer

The answer of During 2008,the Garfield Humane Society,a voluntary health...

Question 14

A not-for-profit organization receives a computer as a donation (valued at $2,000).Prepare the journal entry for the transaction.

Accepted Answer

The answer of A not-for-profit organization receives a computer as...

Question 15

A not-for-profit organization provides the following information for the year:  
Required: Prepare the journal entries for these transactions.

Accepted Answer

The answer of A not-for-profit organization provides the following information...

Question 16

The Yelton Center is a voluntary health and welfare organization.During 2008,unrestricted pledges of $780,000 were received by the center,sixty percent of which were payable in 2008,with the remainder payable in 2009 (for use in 2009).Officials estimated that fifteen percent of these pledges will be uncollectible.
Required:
How much should the Yelton Center report as revenue for 2008?

Accepted Answer

The answer of The Yelton Center is a voluntary health...

Question 17

$520,000 of the $2,720,000 was expected to be uncollectible.
Required:
Prepare the necessary journal entry to record the anticipated uncollectible amount.

Accepted Answer

The answer of $520,000 of the $2,720,000 was expected to...

Question 18

REFERENCE: Ref.18_03
Dura Foundation,a voluntary health and welfare organization dedicated to finding medical cures and supported by contributions from the general public,included the following costs in its Statement of Functional Expenses for the year ended December 31,2008:
 
-What should Dura Foundation report as program service expenses?

Accepted Answer

The answer of REFERENCE: Ref.18_03
Dura Foundation,a voluntary health and welfare...

Quiz 18: Accounting for Not-For-Profit Organizations

The hospital estimated that contractual adjustments would reduce the amount collected from third-party payors to $1,710,000. Required: Prepare the necessary journal entry to record the contractual adjustments.

For May 2008,Carlington Hospital's charges for patient services were $608,000,of which 80% was billed to third-party payors. Required: Prepare the journal entry to accrue patient charges for the month.

The Home incurred the following liabilities: $110,000 salaries,$30,000 medical equipment,$10,000 utilities expense. Prepare the journal entries for these transactions.

According to FASB Statement 117,how are not-for-profits to utilize separate funds?

How does a not-for-profit organization record the receipt of a gift that will be transferred to another charitable organization without restrictions? What if the donor retains the right to revoke or redirect the gift?

In this month,there were several patients that had no health insurance and due to their low income level,the hospital decided that $85,000 of receivables would not be collectible Required: Prepare the necessary journal entry to reflect the decision to consider the $85,000 as charity care.

REFERENCE: Ref.18_02 For the month of December 2008,patient charges at Northfield Hospital (a not-for-profit hospital)were $2,720,000.Third-party payors were billed $1,800,000. -Prepare the necessary journal entry to record the revenue and receivables.

A local business donated medical supplies to Wakefield with a value of $40,000. Prepare the journal entry for the receipt of these supplies.

A not-for-profit organization receives a computer as a donation (valued at $2,000).Prepare the journal entry for the transaction.

A not-for-profit organization provides the following information for the year: Required: Prepare the journal entries for these transactions.

$520,000 of the $2,720,000 was expected to be uncollectible. Required: Prepare the necessary journal entry to record the anticipated uncollectible amount.