Under Lennon Hospital's rate structure, it earned patient service revenue of $9 million for the year ended December 31, 2017. However, Lennon did not expect to collect this entire amount because it deemed $1.4 million to be charity care and estimated contractual adjustments to be $800,000. During 2017, Lennon purchased medical supplies from Harrison Medical Supply Company at a cost of $4,000. Harrison notified Lennon that it was donating the supplies to the hospital. Lennon is a private not-for-profit entity: a. How much should Lennon record as patient service revenue? (Enter your answer in millions rounded to 1 decimal place.) b. How much should Lennon record as net patient service revenue? (Enter your answer in millions rounded to 1 decimal place.) c. How should Lennon record the donation of the supplies? (Enter your answer in dollars not in millions.) a. Patient service revenue million b. Net patient service revenue million

FINANCIAL ACCOUNTING
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Under Lennon Hospital's rate structure, it earned patient service revenue of $9 million for the year ended December 31, 2017.
However, Lennon did not expect to collect this entire amount because it deemed $1.4 million to be charity care and estimated
contractual adjustments to be $800,000.
During 2017, Lennon purchased medical supplies from Harrison Medical Supply Company at a cost of $4,00O. Harrison notified Lennon
that it was donating the supplies to the hospital.
Lennon is a private not-for-profit entity:
a. How much should Lennon record as patient service revenue? (Enter your answer in millions rounded to 1 decimal place.)
b. How much should Lennon record as net patient service revenue? (Enter your answer in millions rounded to 1 decimal place.)
c. How should Lennon record the donation of the supplies? (Enter your answer in dollars not in millions.)
a.
Patient service revenue
million
b
Net patient service revenue
million
C.
Donation of the supplies
Transcribed Image Text:Under Lennon Hospital's rate structure, it earned patient service revenue of $9 million for the year ended December 31, 2017. However, Lennon did not expect to collect this entire amount because it deemed $1.4 million to be charity care and estimated contractual adjustments to be $800,000. During 2017, Lennon purchased medical supplies from Harrison Medical Supply Company at a cost of $4,00O. Harrison notified Lennon that it was donating the supplies to the hospital. Lennon is a private not-for-profit entity: a. How much should Lennon record as patient service revenue? (Enter your answer in millions rounded to 1 decimal place.) b. How much should Lennon record as net patient service revenue? (Enter your answer in millions rounded to 1 decimal place.) c. How should Lennon record the donation of the supplies? (Enter your answer in dollars not in millions.) a. Patient service revenue million b Net patient service revenue million C. Donation of the supplies
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