Which of the Following Is Not Correct with Respect to Reporting

question 10

Multiple Choice

Which of the following is not correct with respect to reporting of patient service revenue for health care organizations?

• A) Patient service revenue must be reported net of estimated adjustments for contractual adjustments
• B) Changes to estimates of contractual adjustments related to prior periods must be reported as a prior period adjustment if material
• C) Patient service revenue does not include amounts representing charity care
• D) Unrestricted bequests and investment income for current unrestricted purposes may be reported as either operating or nonoperatiang revenue, depending on the policy of the entity

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Definitions:

Accounts Receivable

Represents money owed to a company by its customers for goods or services that have been delivered or used but not yet paid for.

Year-End Balance

The financial status of an account at the close of an accounting year, indicating the net value after all transactions.

Inventory Turnover

A measure of how frequently a company sells and replaces its stock of goods during a certain period of time.

Inventory Balance

The quantity of goods or materials on hand at any given time within a business.