Rekj

Additionally, if the dilatory receipt of expectments concerns the organizations ability to quickly pay its own operational expenses thus you cleverness also see an increase in the broadsheets payable indebtedness account. Conversely, on the Income Statement, one would expect to see an increase in the patient role tax revenue account since the deal was that the NCO had continuing to pay in care for a HIGHER reimbursement rate. Also, on the Income Statement as the receivables account increases beca exercise you would also see an increase in the Provision for probationary Accounts.How might negotiating an NCO demand affect pecuniary statements? The accounts that will be impacted on the Balance winding-sheet (which was the nature Of my question) are as follows. How does the Provision for Doubtful Accounts work? Posted by ROBERT ADAMS atlas 16, 2015, 809 PM If a hospital such as FCC renegotiated an NCO contract that allowed the NCO to take longer to pay in exchange for a hig her reimbursement rate, this would increase patient revenue on the Income Statement because the NCO is paying at a higher rate.However, since the NCO has longer to pay then the Patient Accounts Receivable (A/R) on the Balance cruise would also increase. As this A/R account increases, the amount schedule as Provision for Doubtful Accounts would also increase since this expense is a good deal simply a percentage of the A/R account. OR a more real world response In the case of FCC, they work on the Provision of Doubtful Accounts as an expense account. This is an account that is used to take hold the projected losses associated with carrying a receivables account on the Balance Sheet for patient revenue.You might ask why an organization would need to do this. Well anytime you have a receivables account there is some likelihood that some of that account will go uncollected. Generally, an organization can use historical data to project what percentage of a receivable account might no t be collected. Regarding this assignment, FCC renegotiated a primary managed care contract which allowed the NCO longer to pay in exchange for a higher reimbursement rate. The impact of the NCO having longer to pay means that the receivables account would grow.If FCC applies its historical percentage for ungovernable to a growing receivables account then the Provision for Doubtful Accounts would course increase as well. How does purchasing extra inventory change financial statements? As FCC purchases inventory it is placed on the Balance Sheet as an plus. It is VERY important for you all to understand that the supplies expense will not increase on the Income Statement UNTIL the supplies are actually used by FCC. For instance, if FCC purchased $1 of extra inventory this loud be listed as an asset on the Balance Sheet.