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P 19-1

P 19-1 Statement of activities- Hospital
The following events wererecorded on the books of Mercy Hospital for the year ended
December 31, 2012.
1.) Revenue from patientservices totaled $16,000,000. The allowance for uncollectibles wasestablised
at $3,400,000. of the$16,000,000 revenue, $6,000,000 was recognized under costreinbursement agreements.
This revenue is subject toaudit and retroactive adjustment by third-party payers (estimatedadjustments
are included in the allowanceaccoun).
2.) Patient service revenue isaccounted for at established rates on the accrual basis.
3.) Other operating revenuetotaled $346,000, of which $160,000 was from specific purposefunds.
4.) Mercy received $410,000in unrestricted gifts and bequests. They are recorded at fairmarket value
when received.
5.) Endowment funds earned$160,000 in unrestricted income.
6.) Biard desgnated fundsearned $82,000 in income.
7.( Mercy's operatingexpenses for the year amounted to $13,370,000. This included$500,000 in
straight-linedepreciation.
Required:
Prepare a statement ofactivities for Mercy Hospital for the year ended December31,2012.

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