Question

12. A fund that is the result of an agreement between a contributor and a government that the principal and/or income of trust assets is for the benefit of individuals, organizations, or other governments is a(n):

1. Agency fund

2. Private-Purpose Trust Fund

3. Investment Trust Fund

4. Pension Trust Fund

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

i. 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.

ii. 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

iii. The value of foregone charity care revenue is deducted as a charitable contribution

iv. Management’s policy for providing charity care and the level of charity care provided is an optional disclosure

15. Which of the following is true regarding revenue recognition for health care organizations?

A) Patient service revenue is reported net of contractual adjustments.

B) Patient service revenue includes an imputed charge for charity care.

C) Both of the above.

D) Neither of the above.

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

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.

Answer 1

12. 2 . Private purpose trust fund

13. ii) 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.

15. A) Patient service revenue is reported net of contractual adjustments.

16. 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.?