Question 1

Not-for-profit health care entities are distinguished from voluntary health and welfare organizations in the following manner:

Accepted Answer

A)  Health care organizations provide health care services while voluntary health and welfare organizations do not. 
B)  Health care organizations use accrual accounting whereas voluntary health and welfare organizations do not. 
C)  Health care organizations are considered to be primarily business-oriented whereas voluntary health and welfare organizations raise a significant portion of their money from voluntary contributions. 
D)  Health care organizations do not provide services to individuals who are unable to pay. 
A)  Health care organizations provide health care services while voluntary health and welfare organizations do not. 
B)  Health care organizations use accrual accounting whereas voluntary health and welfare organizations do not. 
C)  Health care organizations are considered to be primarily business-oriented whereas voluntary health and welfare organizations raise a significant portion of their money from voluntary contributions. 
D)  Health care organizations do not provide services to individuals who are unable to pay. C

Question 2

Which of the following is correct with respect to the recording of charity care for health care organizations?

Accepted Answer

A)  Charity care is recorded as revenue and an adjustment is recorded for the difference between the value of the revenue and expenses incurred in providing health care services. 
B)  Revenues are not recorded for the value of charity care services provided, but related expenses are included with other expenses on the Statement of Operations. 
C)  The value of foregone charity care revenue is deducted as a charitable contribution. 
D)  Management's policy for providing charity care and the level of charity care provided is an optional disclosure. 
A)  Charity care is recorded as revenue and an adjustment is recorded for the difference between the value of the revenue and expenses incurred in providing health care services. 
B)  Revenues are not recorded for the value of charity care services provided, but related expenses are included with other expenses on the Statement of Operations. 
C)  The value of foregone charity care revenue is deducted as a charitable contribution. 
D)  Management's policy for providing charity care and the level of charity care provided is an optional disclosure. B

Question 3

Which of the following is false regarding revenues of health care organizations?

Accepted Answer

A)  Patient service revenues are to be reported net of estimated adjustments for contractual and other adjustments in the operating statement. 
B)  Operating Revenues are often classified as net patient service revenue and other revenue. 
C)  Patient service revenue includes charge for charity care. 
D)  All of the statements are true. 
A)  Patient service revenues are to be reported net of estimated adjustments for contractual and other adjustments in the operating statement. 
B)  Operating Revenues are often classified as net patient service revenue and other revenue. 
C)  Patient service revenue includes charge for charity care. 
D)  All of the statements are true. C

Question 4

A private sector not-for-profit hospital received a gift of $200,000 cash on the first day of 2012 with a donor restriction that the resources be used to purchase certain equipment.The equipment was purchased on the same day and is expected to last five years with no salvage value.The Statement of Financial Position as of December 31,2012 would reflect as net assets of:

Accepted Answer

A)  $160,000 unrestricted and $0 temporarily restricted. 
B)  $0 unrestricted and $160,000 temporarily restricted. 
C)  Either (a) or (b), depending on the policy of the hospital. 
D)  None of the above. 
A)  $160,000 unrestricted and $0 temporarily restricted. 
B)  $0 unrestricted and $160,000 temporarily restricted. 
C)  Either (a) or (b), depending on the policy of the hospital. 
D)  None of the above.

Question 5

The AICPA Health Care Guide does not specifically exclude which of the following from the determination of the performance indicator in the Statement of Operations?

Accepted Answer

A)  Transfers among affiliated organizations. 
B)  Items identified by FASB standards as elements of other comprehensive income. 
C)  Transactions with owners in exchange for services. 
D)  Receipt of temporarily or permanently restricted contributions. 
A)  Transfers among affiliated organizations. 
B)  Items identified by FASB standards as elements of other comprehensive income. 
C)  Transactions with owners in exchange for services. 
D)  Receipt of temporarily or permanently restricted contributions.

Question 6

Private sector,not-for-profit hospital received a gift of $2,000,000 from a donor who indicated that the gift was to be "split" between the hospital and the donor's beneficiary.Specifically,this gift instrument provided that the hospital is to receive $100,000 per year for the next ten years,with the remainder going to the beneficiary.The gift is known as a charitable lead trust,from the point of view of the hospital.The gift was received in 2012,with the first payment to the hospital due in 2013.In 2012,the hospital would record revenue in the amount of:

Accepted Answer

A)  $0. 
B)  $100,000. 
C)  $2,000,000. 
D)  the present value of the future receipts (the present value of $100,000 per year for the next ten years. 
A)  $0. 
B)  $100,000. 
C)  $2,000,000. 
D)  the present value of the future receipts (the present value of $100,000 per year for the next ten years.

Question 7

With respect to health care organizations,expenses must be reported using their natural classifications.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following health care organizations have level "A" GAAP established by the Governmental Accounting Standards Board?

Accepted Answer

A)  Government owed hospitals. 
B)  Private not-for-profit hospitals. 
C)  Both of the above. 
D)  Neither of the above. 
A)  Government owed hospitals. 
B)  Private not-for-profit hospitals. 
C)  Both of the above. 
D)  Neither of the above.

Question 9

Assume you are reviewing the financial statements of a not-for-profit hospital.Where would you find the account "Assets whose is limited" and how is it used?

Accepted Answer

"Assets whose use is limited" is an acco

Question 10

The AICPA Health Care Guide governs which of the following organizations?

Accepted Answer

A)  Private not-for-profit health care organizations. 
B)  Investor-owned health care organizations. 
C)  Governmentally owned health care organizations. 
D)  All of the above. 
A)  Private not-for-profit health care organizations. 
B)  Investor-owned health care organizations. 
C)  Governmentally owned health care organizations. 
D)  All of the above.

Question 11

Both public and private sector health care organizations measure transactions and events similarly,but use different equity accounts.

Accepted Answer

A) True 
 B)False

Question 12

Patient service revenue for a hospital does not include charges for charity care.

Accepted Answer

A) True 
 B)False

Question 13

A "performance indicator" is required in the Statement of Operations for health care entities.Which of the following must be reported below that performance indicator?

Accepted Answer

A)  Other revenue, such as parking lot or cafeteria revenue. 
B)  Net assets released from restrictions for operating purposes. 
C)  Both of the above. 
D)  Neither of the above. 
A)  Other revenue, such as parking lot or cafeteria revenue. 
B)  Net assets released from restrictions for operating purposes. 
C)  Both of the above. 
D)  Neither of the above.

Question 14

The AICPA Audit and Accounting Guide:
 Health Care Organizations applies equally to private not-for-profit,governmentally owned,and investor-owned health care organizations.

Accepted Answer

A) True 
 B)False

Question 15

Both commercial and not-for-profit hospitals in the private sector follow FASB standards.

Accepted Answer

A) True 
 B)False

Question 16

If a clinic raises a significant amount or nearly all their resources from voluntary contributions or grants,then they are subject to the guidance in the:

Accepted Answer

A)  Not-for-Profit Guide. 
B)  Health Care Guide. 
C)  Voluntary Health and Welfare Guide. 
D)  Contributions and Grants Guide. 
A)  Not-for-Profit Guide. 
B)  Health Care Guide. 
C)  Voluntary Health and Welfare Guide. 
D)  Contributions and Grants Guide.

Question 17

Which of the following is not true regarding financial reporting of health care entities?

Accepted Answer

A)  It is important to distinguish operating revenues and expenses from nonoperating. 
B)  It is important to distinguish between current and noncurrent assets and liabilities. 
C)  Private sector organizations use a three-category format for the Statement of Cash Flows, and public sector organizations use a four-category format. 
D)  Private sector organizations use accrual accounting, while public sector organizations use modified accrual. 
A)  It is important to distinguish operating revenues and expenses from nonoperating. 
B)  It is important to distinguish between current and noncurrent assets and liabilities. 
C)  Private sector organizations use a three-category format for the Statement of Cash Flows, and public sector organizations use a four-category format. 
D)  Private sector organizations use accrual accounting, while public sector organizations use modified accrual.

Question 18

Identify the three types of restrictions placed on temporarily restricted net assets of a private sector not-for-profit health care organization and outline the accounting requirements for each type.

Accepted Answer

Time Restricted: Contributions (includin

Question 19

According to AICPA Health Care Guide which of the following shouldnot be include in the determination of a performance indicator for a health care organization?

Accepted Answer

A)  Transfers among affiliated organizations. 
B)  Receipt of temporarily or permanently restricted contributions. 
C)  Both A and B should not be included. 
D)  None of the above. 
A)  Transfers among affiliated organizations. 
B)  Receipt of temporarily or permanently restricted contributions. 
C)  Both A and B should not be included. 
D)  None of the above.

Question 20

Health care organizations require a "performance indicator" in the statement displaying revenues and expenses.Which of the following must be reported below that performance indicator?

Accepted Answer

A)  Transfers-in from affiliated organizations. 
B)  Investment returns restricted by donors or by law. 
C)  Both of the above. 
D)  Neither of the above. 
A)  Transfers-in from affiliated organizations. 
B)  Investment returns restricted by donors or by law. 
C)  Both of the above. 
D)  Neither of the above.

Not-for-profit health care entities are distinguished from voluntary health and welfare organizations in the following manner:

Which of the following is correct with respect to the recording of charity care for health care organizations?

Which of the following is false regarding revenues of health care organizations?

The AICPA Health Care Guide does not specifically exclude which of the following from the determination of the performance indicator in the Statement of Operations?

With respect to health care organizations,expenses must be reported using their natural classifications.

Which of the following health care organizations have level "A" GAAP established by the Governmental Accounting Standards Board?

Assume you are reviewing the financial statements of a not-for-profit hospital.Where would you find the account "Assets whose is limited" and how is it used?

The AICPA Health Care Guide governs which of the following organizations?

Both public and private sector health care organizations measure transactions and events similarly,but use different equity accounts.

Patient service revenue for a hospital does not include charges for charity care.

A "performance indicator" is required in the Statement of Operations for health care entities.Which of the following must be reported below that performance indicator?

The AICPA Audit and Accounting Guide: Health Care Organizations applies equally to private not-for-profit,governmentally owned,and investor-owned health care organizations.

Both commercial and not-for-profit hospitals in the private sector follow FASB standards.

If a clinic raises a significant amount or nearly all their resources from voluntary contributions or grants,then they are subject to the guidance in the:

Which of the following is not true regarding financial reporting of health care entities?

Identify the three types of restrictions placed on temporarily restricted net assets of a private sector not-for-profit health care organization and outline the accounting requirements for each type.

According to AICPA Health Care Guide which of the following shouldnot be include in the determination of a performance indicator for a health care organization?

Health care organizations require a "performance indicator" in the statement displaying revenues and expenses.Which of the following must be reported below that performance indicator?

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Accounting for Other Governmental Fund Types: Capital Projects, debt Service, and Permanent

Proprietary Funds

Fiduciary Trustfunds

Government-Wide Statements, capital Assets, long-Term Debt

Advanced Topics for State and Local Governments

Accounting for Private Not-For-Profit Organizations

College and University Accounting

Auditing, tax-Exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

Filters

Exam 12: Accounting for Hospitals and Other Health Care Providers

Not-for-profit health care entities are distinguished from voluntary health and welfare organizations in the following manner:

Which of the following is correct with respect to the recording of charity care for health care organizations?

Which of the following is false regarding revenues of health care organizations?

The AICPA Health Care Guide does not specifically exclude which of the following from the determination of the performance indicator in the Statement of Operations?

With respect to health care organizations,expenses must be reported using their natural classifications.

Which of the following health care organizations have level "A" GAAP established by the Governmental Accounting Standards Board?

Assume you are reviewing the financial statements of a not-for-profit hospital.Where would you find the account "Assets whose is limited" and how is it used?

The AICPA Health Care Guide governs which of the following organizations?

Both public and private sector health care organizations measure transactions and events similarly,but use different equity accounts.

Patient service revenue for a hospital does not include charges for charity care.

A "performance indicator" is required in the Statement of Operations for health care entities.Which of the following must be reported below that performance indicator?

The AICPA Audit and Accounting Guide: Health Care Organizations applies equally to private not-for-profit,governmentally owned,and investor-owned health care organizations.

Both commercial and not-for-profit hospitals in the private sector follow FASB standards.

If a clinic raises a significant amount or nearly all their resources from voluntary contributions or grants,then they are subject to the guidance in the:

Which of the following is not true regarding financial reporting of health care entities?

Identify the three types of restrictions placed on temporarily restricted net assets of a private sector not-for-profit health care organization and outline the accounting requirements for each type.

According to AICPA Health Care Guide which of the following shouldnot be include in the determination of a performance indicator for a health care organization?

Health care organizations require a "performance indicator" in the statement displaying revenues and expenses.Which of the following must be reported below that performance indicator?

Introduction to Accounting and Financial Reporting for Governmental and Not-For-Profit Organizations

Overview of Financial Reporting for State and Local Governments

Modified Accrual Accounting: Including the Role of Fund Balances and Budgetary Authority

Accounting for the General and Special Revenue Funds

Accounting for Other Governmental Fund Types: Capital Projects, debt Service, and Permanent

Proprietary Funds

Fiduciary Trustfunds

Government-Wide Statements, capital Assets, long-Term Debt

Advanced Topics for State and Local Governments

Accounting for Private Not-For-Profit Organizations

College and University Accounting

Auditing, tax-Exempt Organizations, and Evaluating Performance

Financial Reporting by the Federal Government

Filters