Chapter 18: Accounting and Reporting for Private Not-for-Profit Organizations

Chapter 18: Accounting and Reporting for Private Not-for-Profit Organizations



1. A hospital has the following account balances:

What is the hospital's net patient service revenue? A. $422,000
B. $430,000
C. $500,000
D. $540,000
E. $473,000



2. Which one of the following is not a required financial statement for a voluntary health and welfare organization? A. Statement of Financial Position
B. Statement of Activities and Changes in Net Assets
C. Statement of Fund Balance
D. Statement of Cash Flows
E. Statement of Functional Expense



3. Wakefield Hospital's accounting records disclosed the following information:

What What amount should be included as part of the General Funds? A. $12,800,000
B. $12,300,000
C. $ 9,500,000
D. $10,800,000
E. $11,400,000



4. Southside Medical Center, a not-for-profit hospital, provides its patients with services that would normally be charged at $600,000. However, a $70,000 reduction is estimated because of contractual adjustments. Another $30,000 reduction is expected because of bad debts. Finally, $100,000 will not be collected because the amounts are deemed to be charity care. Which of the following are correct? A. Patient Service Revenues = $500,000, Net Patient Service Revenues = $430,000
B. Patient Service Revenues = $600,000, Net Patient Service Revenues = $500,000
C. Patient Service Revenues = $530,000, Net Patient Service Revenues = $400,000
D. Patient Service Revenues = $500,000, Net Patient Service Revenues = $470,000
E. Patient Service Revenues = $530,000, Net Patient Service Revenues = $450,000



5. In 2001, a not-for-profit hospital received an unrestricted gift of common stock with a fair market value of $100,000. The donor had paid $45,000 for the stock in 1991. The hospital should record the gift as a A. Memorandum entry only.
B. Nonoperating gain of $ 45,000.
C. Nonoperating gain of $ 55,000.
D. Nonoperating gain of $ 65,000.
E. Nonoperating gain of $100,000.



6. According to the AICPA audit and accounting guide, which one of the following is not a required financial statement for a healthcare organization? A. Statement of Operations
B. Balance Sheet
C. Statement of Changes in Equity
D. Statement of Functional Expense
E. Statement of Cash Flows



7. Ashley Shaw took a leave of absence from her job to work full-time for a voluntary health and welfare organization for three months. Ashley filled the position of program coordinator, a position that normally paid $24,000 per year. Ashley accepted no remuneration for her work. These donated services be recorded as A. Revenue of $6,000 and an expense of $6,000.
B. A contribution of $6,000 and an expense of $6,000.
C. Revenue of $6,000 and a contribution of $6,000.
D. A contribution of $6,000 and public support of $6,000.
E. Public Support of $6,000 and an expense of $6,000.



8. A local voluntary health and welfare organization had the following expenditures:

What How should these items be reported by the organization? A. Program Service Expenses = $120,000, Supporting Service Expenses = $ 5,000
B. Program Service Expenses = $100,000, Supporting Service Expenses = $ 25,000
C. Program Service Expenses = $105,000, Supporting Service Expenses = $ 20,000
D. Program Service Expenses = $ 80,000, Supporting Service Expenses = $ 45,000
E. Program Service Expenses = $ 95,000, Supporting Service Expenses = $ 30,000



9. A voluntary health and welfare organization received a pledge in 2000 from a donor specifying that the amount pledged be used in 2002. The donor paid the pledge with cash in 2001. The pledge should be accounted for as A. Support in 2001 with no deferred credit in the balance sheet at the end of 2002.
B. Support in 2002.
C. Deferred support in the balance sheet at the end of 2000 and 2001, and support in 2002.
D. Deferred support in the balance sheet at the end of 2000, and support in 2001.
E. Deferred support in the balance sheet at the end of 2001, and support in 2002.



10. A voluntary health and welfare organization had the following asset inflows:

What How should these items be reported? A. Revenues = $ 16,000, Public Support = $ 42,000
B. Revenues = $ 8,000, Public Support = $ 50,000
C. Revenues = $ 56,000, Public Support = $ 2,000
D. Revenues = $ 10,000, Public Support = $ 48,000
E. Revenues = $ 20,000, Public Support = $ 38,000

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