Accounting Homework

Ch. 7 Exercises

E7.1.	Using the provided information, the necessary adjusting entries are:
		Account and Explanation	Account Number	Debit	Credit
	1)	Accounts receivable	104
		Routine Services Revenue	401
		Ancillary Service Revenue	402
		Services rendered to patients
	2)	Cash	101
		Contractual adjustments	501
		Accounts receivable
		Collection of third party accounts at 85%
E7.2.	Using the provided information, the necessary adjusting entries are:
		Account and Explanation	Account Number	Debit	Credit
	1)	Bad debt expense	609	9,000
		Allowances for uncollectible accounts	105		9,000
		Adjusted for estimated portion of accounts receivable likely to prove uncollectoble by reason of contractual adjustment (9% of 100,000)
	2	Allowance for uncollectible accts	105	700
		Accounts receivable	104		700
		Write-off of patient accts deemed to be a bad debt
E7.3.	1) Using the provided information, the necessary adjusting entries are:
		Account and Explanation	Account Number	Debit	Credit
	1)	Charity Care	502
		Allowances for uncollectible accounts	105
		Adjustment for estimated charity care in year-end accounts receivables (7%*100,00)
		Contractual Adjustments	501
		Allowances for uncollectible accounts	105
		Adjusted for estimated portion of accounts receivable likely to prove uncollectable by reason of contractual adjustment (10% of 100,000)
		Bad debt expense	609
		Allowances for uncollectible accounts	105
		Adjusted for estimated portion of accounts receivable likely to prove uncollectable by reason of bad debt (4% of 100,000)
	2)	The receivables should be presented in the balance sheet as follows:
		Accounts receivable
		Less allowance for uncollectible accounts
				0
E7.4.
			Cost	Salvage Value	Useful Life
		Land
		Buildings
		Equipment
	1)	Depreciation expense 2014
	2)	BALANCE SHEET - December 31, 2016
		Buildings, at cost
		Less accumulated depreciation
		Buildings, net	0
		Equipment, at cost
		Less accumulated depreciation
		Equipment, net	0
E7.5.
		Purchase Date	Cost	Salvage Value	Useful Life	Annual Depr
		1/1/11
		4/1/11
		7/1/11
			Months	2011 Depr
		1/1/11		0
		4/1/11		0
		7/1/11		0
				0

&"Arial,Italic"&10Chapter 7: Problems