26. According to FASB standards, which of the following entities would not be considered a health care organization?
A. The Heart Research Institute.
27. Which of the following is (are) considered an authoritative source of GAAP for nongovernmental not-for-profit health care entities?
C. The FASB Accounting Standards Codification (ASC).
28. Which of the following is not a financial statement prepared by nongovernmental not-for-profit health care entities?
B. Statement of revenues, expenses, and changes in net assets.
29. Contractual adjustments that arise from differences between the gross charge for patient services and the amount paid by a third party payor are reported as:
A. Deductions from gross patient revenue in arriving at net patient revenue.
30. Which of the following would be considered an asset limited as to use?
C. Cash the board of directors has designated for equipment acquisitions.
31. Which of the following statements is true about diagnosis-related groups (DRGs)?
B. A DRG is a case-mix classification scheme that is used to determine the payment provided to the hospital for inpatient services, regardless of how much the hospital spends to treat a patient.
32. The primary source of revenue for most hospitals is:
B. Exchange transactions, such as fees for services.
33. A hospital originally recorded all patient services it provided as a $500,000 debit to accounts receivable. Upon review the hospital determined that a contractual adjustment of $200,000 needs to be made, and estimated bad debts of $5,000 need to be re
D. $195,000.
34. Charity service and bad debts in a government hospital that follows business-type accounting are:
C. Reported differently, with charity service disclosed in the notes to the financial statements and bad debts reported as a deduction from revenue.
35. Which of the following volunteer services is most likely to be reported by a nongovernmental not-for-profit hospital as contribution revenue and an expense?
C. Nurses from a religious organization who volunteer to assist in the care of critically ill children.
36. Which of the following could be included in the performance indicator measure provided by a nongovernmental not-for-profit hospital?
B. Gain on sale of equipment.
37. Which of the following would usually be considered as temporarily restricted net assets in a nongovernmental not-for-profit hospital?
D. A research grant from the federal government to study high blood pressure.
38. Where does a nongovernmental not-for-profit health care entity report increases that have occurred in its temporarily restricted net assets?
A. Statement of changes in net assets.
39. Contractual Adjustments is properly characterized as:
D. A contra revenue.
40. In accordance with the FASB Codification, donated medicines that normally would be purchased by a hospital should be recorded at fair value and credited to which of the following?
B. Other Revenue.
41. An annual contributor to a nongovernmental not-for-profit hospital made an unrestricted pledge in October 2016 that will be paid in March 2017. Assuming the hospital's fiscal year-end is December 31, 2016, the pledge should be credited to:
A. Contributions�Temporarily Restricted in 2016.
42. How would the cash acquisition of equipment be reported on a health care entity's statement of cash flows?
B. Investing activity applying FASB standards.
43. Where would a capitation fee be reported on a health care entity's financial statements?
A. Service revenue.
44. In accordance with the FASB Codification, which of the following would be an appropriate performance indicator for a not-for-profit health care organization?
B. Excess of revenues and gains over expenses and losses.
45. The GASB requires business-type health care organizations to prepare which of the following financial statements?
A. Statement of revenues, expenses, and changes in net position; statement of net position; and statement of cash flows.
46. Which of the following statements concerning the Patient Protection and Affordability Act (also known as the Affordable Care Act) is true?
C. Since all portions of the Act have only recently been enacted the full impact on health care accounting is unknown.
47. Which of the following is shown on a statement of changes in net assets?
A. An increase in temporarily restricted net assets.
48. Which of the following would be considered service revenue of a health care entity?
B. Capitation fees received from a health maintenance organization.
29. Contractual adjustments that arise from differences between the gross charge for patient services and the amount paid by a third party payor are reported as:
A. Deductions from gross patient revenue in arriving at net patient revenue.
35. Which of the following volunteer services is most likely to be reported by a nongovernmental not-for-profit hospital as contribution revenue and an expense?
C. Nurses from a religious organization who volunteer to assist in the care of critically ill children.
42. How would the cash acquisition of equipment be reported on a health care entity's statement of cash flows?
B. Investing activity applying FASB standards.