Which Entry Would Be the Correct Entry to Record That

question 18

Multiple Choice

Which entry would be the correct entry to record that a hospital has provided patient services for $200,000, of which 25% will be billed to a third party? DEBIT CREDIT

• A) Accounts Receivable-Patients $200,000 Patient Service Revenue $200,000
• B) Accounts Receivable-Patients $150,000 Patient Service Revenue $200,000 Accounts Receivable-Third Party $50,000
• C) Accounts Receivable-Patients $50,000 Accounts Receivable-Third Party $150,000 Patient Service Revenue $200,000
• D) Accounts Receivable-Patients $200,000 Patient Service Revenue $50,000 Accounts Receivable - Third Party $150,000
• E) Patient Service Revenue $200,000 Accounts Receivable-Patients $150,000 Accounts Receivable-Third Party $50,000

---

Definitions:

Profit Center

A separate business unit or department within an organization that is responsible for generating its own revenue and profits.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, culminating in a net income or loss.

Controllable Expenses

Costs that can be influenced by the decisions of a manager.

Profit Center Management

The administration of a segment of a business that is directly responsible for its own revenue and expenses, aiming to maximize profits.