Record the following transactions on the books of St. Marie's Hospital, a private not-for-profit hospital.  (a)The Hospital billed patients $612,000 for services rendered. Of this amount, 5% is expected to be uncollectible. Contractual adjustments with insurance companies are expected to total $87,000. (b)The Hospital received $750,000 in pledges of support in a campaign undertaken to purchase new MRI equipment. All of the pledges are payable within one year and 8% are expected to be uncollectible.(c)Charity care in the amount of $36,000 (at standard charges) was performed on an indigent patient.(d)The Hospital collected $487,200 for the services performed in (1) above. Actual contractual adjustments for these services amounted to $89,700. $ 13,700 of receivables were

identified as uncollectible and written off.

What will be an ideal response?

a.Patient Accounts Receivable612,000
  Operating Revenues - Patient Service Revenue -612,000
   unrestricted
 Operating Expense General Services-Bad Debts30,600
  Allowance for Patient Accounts Receivable30,600
 Contractual Adjustments - unrestricted87,000
  Allowance for Contractual Adjustments87,000
b.Pledges Receivable750,000 
  Allowance for Uncollectible Pledges60,000
   Nonoperating revenues Contributions-
  Temporarily Restricted690,000
c.No Journal Entry
d.Cash487,200
  Patient Accounts Receivable487,200
 Allowance for Contractual Adjustments87,000
Contractual Adjustments2,700
  Patient Accounts Receivable89,700
Allowance for Patient Accounts Receivable13,700
  Patient Accounts Receivable13,700

Business

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