73.Which of the following is not true regarding accounting and financial reporting for private not-for-profit hospitals?
A)Expenses may be unrestricted or temporarily restricted depending on donor intent.
B)Fund accounting is not required.
C)The Statement of Cash Flows may use either the direct or indirect method.
D)Net assets are classified as Unrestricted, Temporarily Restricted or Permanently Restricted.
74.Which of the following is true regarding revenue recognition for health care organizations?
A)Patient service revenues are reported net of contractual adjustments.
B)Revenues do not include charity care.
C)Revenues may include fees for parking, cafeteria sales, and gift shops.
D)All of the above are true.
75.Which of the following is a required statement for a governmental hospital?
A)Statement of Changes in Fund Balance.
B)Statement of Revenues and Expenditures.
C)Statement of Functional Expense.
D)Statement of Cash Flows.
76.A hospital reported the following uncollectible amounts:
$ 10,000 for services rendered to homeless individuals with no intention of collection.
$ 30,000 for services rendered with the expectation of collection, but which proved to be uncollectible.
What amount should be reported in revenues and bad debt expense for these items?
A)Revenues: $ 40,000; Bad Debt Expense: 40,000.
B)Revenues: $ 40,000; Bad Debt Expense: 30,000.
C)Revenues: $ 30,000; Bad Debt Expense: 30,000.
D)Revenues: $ 0; Bad Debt Expense: 0.
77.The difference between accounting for private not-for-profit hospitals and government- owned hospitals is:
A)Government owned hospitals do not have to prepare a Statement of Cash Flows.
B)Government owned hospitals do not have to record depreciation.
C)The equity accounts have different titles and definitions.
D)All of the above.
78.The difference between the financial statements of private not-for-profit hospitals and private not-for-profit voluntary health and welfare organizations is:
A)Hospitals do not have to prepare a Statement of Functional Expense.
B)Voluntary health and welfare organizations do not have to prepare a Statement of Cash Flows.
C)Both (a) and (b) above.
D)Neither (a) nor (b) above.
79.Private health care organizations follow _____ standards while governmentally owned health care organizations follow _____ standards.
A) GASB; FASB.
B) FASB; GASB.
C) FASB; FASAB.
D) GASB; FASAB.
80.A private not-for-profit entity estimated its Allowance for Contractual Adjustment. During the next year, the hospital found that the actual total of contractual adjustments applied to receivables on hand at the end of the previous year was $ 5,000 higher than the estimate. How should the difference be reported?
A)The hospital should reduce current period net patient service revenues for the $5,000.
B) The hospital should make a prior period adjustment to retained earnings for $5,000.
C)The hospital should record a current period expense for the $5,000.
D)The hospital should record a “cumulative effect of a change in accounting principle” for the $5,000.
81.Private not-for-profit health care organizations include what categories in the equity section of the Statement of Net Assets?
A) Unrestricted, temporarily restricted, and permanently restricted.
B) Paid in capital and retained earnings.
C) Invested in capital net of related debt, restricted, and unrestricted.
D) Operating, investing, financing.
82.According to the AICPA Audit and Accounting Guide: Health Care Organizations, which of the following items should not be included in the determination of the performance indicator?
A) Receipt of temporarily or permanently restricted contributions.
B) Items requiring separate display (such as extraordinary items, discontinued operations, and the effect of changes in accounting principle).
C)Both (a) and (b) above.
D)Neither (a) nor (b) above.