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William Van Schoonhoven Thorne.

Hospital accounting and statistics online

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entered on the credit side of the Treasurer's Cash Book and should be debited to
Prepaid Insurance Account.

The Treasurer should keep in his office and also furnish to the Superintendent
a statement showing how much of any prepaid insurance is properly chargeable
each month to ciurrent expenses, so that each month the Superintendent can
make a voucher in favor of the Treasurer for such an amount accordingly and
thus include the proper charge in current expenses. When the Treasurer receives
the Superintendent's voucher check he debits his cash account and credits Pre-
paid Insiu-ance Account accordingly. If original bills for certain kinds of insur-
ance are very small it may be thought best to pay these direct by voucher through
the Superintendent's office and not apportion the charges over a series of months
during which the insurance is in effect.



Db.



14. CAPITAL ACCOUNT (HOSPITAL PROPERTIES ANT>
EQUIPMENT)



Actual Net Loss or Damage
account sale, fire or demo-
lition, charged off Hos-
pital Properties and
Equipment, Schedule 4,
during month and cred-
ited to proper accounts
on Treasurer's General
Ledger, as per Journal

Entry 7

Book Value of "Sites
and Grounds," "Build-
ings," "Furniture and
Fixtures," "Machinery
and Tools," "Apparatus
and Instruments," "Am-
bulances, Live Stock,
etc.," or other "Hospital
Properties and Equip-
ment," Schedule 4, sold
during the month, or for
amount collected during
month from insurance
companies for such prop-
erties damaged or de-
stroyed by fire, as per
Journal Entry 19



§Total from previous month

Capital Expenditures
Schedule 3, during month,
as per Voucher Register,
as reported by Superin-
tendent, as per Journal
Entry 5

Value of gifts in shape of
"Hospital Properties and
Equipment," Schedule 4,
given to Hospital during
month, if capitalized, and
debited to proper account
on Treasurer's General
Ledger, as per Journal
Entry 5

Appreciation in value of
"Sites and Grounds,"
"BuUdings," or other
Hospital Properties and
Equipment as per Joiur-
nal Entry 17

Amount to be credited to
" Capital Account" to rep-
resent increase of equity
of the Hospital in its Pro-
perties and Equipment by
reduction of Mortgages
Payable Account, as per
Journal Entry 23

Total



Cb.



Total

Difference in totals equals "Capital Account" (Hospital Properties and Equip-
ment), as shown on Books and on Balance Sheet.



80 TREASURER'S GENERAL LEDGER ACCOUNTS

Note — "Capital Account" ("Hospital Properties and Equip-
ment*') may be considered as practically a subdivision of "Sur-
plus and Deficit Account." The balance standing to the credit
of "Capital Account" is really a part of the surplus of the
hospital.

"Capital Account," which represents the book value of the
hospital's equity in its working plant, plus "Reserve for Depre-
ciation of Hospital Properties and Equipment," if any such
accoimt is established, plus bonds outstanding or mortgages
payable on Hospital Property, if any, should equal the total
book value of the assets of the hospital, which compose its work-
ing plant or Hospital Properties and Equipment, Schedule 4,
such as "Sites and Grounds," "Buildings," "Furniture and Fix-
tures," "Machinery and Tools," "Apparatus and Instruments,"
and "Ambulance, Live Stock, etc."

By keeping this "Capital Account" (Hospital Properties
and Equipment) out of "Surplus and Deficit Account" as
here indicated, the amount of the deficit, if any, up to the
amount of the Reserve Fund Accounts, as shown by the "Sur-
plus and Deficit Account," will represent the exact amount
which the Reserve Funds of the Hospital have been encroached
upon.

The amount of surplus, if any, as shown by the "Surplus and
Deficit Account," will represent the amount of surplus, which
the hospital may have to its credit, not including the equity the
hospital may have in its working plant or Hospital Properties
and Equipment.

If a mortgage payable on Hospital Property is fully or partly
paid ofiF the money paid should be entered on the credit side of the
Treasurer's Cash Book and should be debited to "Mortgages Pay-
able Account."

The equity of the Hospital in its Properties and Equipment is
increased by the amount of such payment and reduction in "Mort-
gages Payable Account" and in order that Capital Account may
represent this equity Journal Entry No. 23 should be made and
"Surplus and Deficit Account" should be debited and "Capital
Account" should be credited accordingly.

Conversely, if a mortgage payable on Hospital Property is
created the money received should be entered on the debit side of
the Treasurer's Cash Book and should be credited to "Mortgages
Payable Account." In order that Capital Account may then



TREASURER'S GENERAL LEDGER ACCOUNTS 81

represent the decreased equity of the Hospital in its Properties and
Equipment, a Journal Entry, the reverse of No. 23, should be
made, whereby "Capital Account" may be debited and "Surplus
and Deficit Account" may be credited accordingly.

RESERVE FOR DEPRECIATION OF HOSPITAL PROP-
ERTIES AND EQUIPMENT

In case it is desired to establish a "Reserve for Depreciation of
Hospital Properties and Equipment" (without disturbing the cost
values and without reducing book values below the values at
which such properties may be insured) to show the estimated
amount of depreciation or deferred up-keep on "Buildings,"
"Furniture and Fixtures," "Machinery and Tools," or on other
Hospital Properties and Equipment, Schedule 4, the amounts of
this estimated depreciation ma!y at the end of each fiscal year be
debited to "Capital Account" and credited to "Reserve for
Depreciation of Hospital Properties and Equipment " by a journal
entry similar to No. 20.

This "Reserve for Depreciation" would practically be a sub-
division of "Surplus and Deficit Account" and the balance on
the credit side of this account would represent a part of the surplus
of the hospital.

In case there is actual net loss or damage caused by sale,
fire, or by demolition, etc., not covered by insurance, to any
of the subdivisions of Hospital Properties and Equipment,
Schedule 4, and if it is desired to charge such part of this net
loss or damage as may be covered by the "Reserve for Depre-
ciation" to such Depreciation Account this may be done by
Journal Entry 22.

In case extraordinary repairs or renewals are made to any
of the subdivisions of Hospital Properties and Equipment,
Schedule 4, and if it is desired to charge such part of such
expenditures as may be covered by the Reserve for Depre-
ciation, to such Depreciation Account this may be done by
Journal Entry 21.

If a Fund for Depreciation of Hospital Properties and
Equipment, as outlined above, is established, one-twelfth of the
estimated amount of yearly depreciation of Hospital Properties
and Equipment might very properly be added to the actual
monthly Operating Expenses, Schedule 2, in order to ascertain



82



TREASURER'S GENERAL LEDGER ACCOUNTS



the full cost of running the Hospital and to figure the full cost
per patient per day (not including Corporation Expenses or Special
Fund Expenses).



15. RESERVE FOR DEPRECIATION OF HOSPITAL PROPERTIES AND

EQUIPMENT
Dh.



For actual net loss or dam-
age by sale, fire or demoli-
tion, etc., charged off
Hospital Properties and
Equipment referred to
during month, as per Jour-
nal Entry 22

Buildings

Furniture and Fixtures

Machinery and Tools

Apparatus and Instruments

Ambulances, Live Stock, etc.
Total



For extraordinary repairs or
renewals made during
month charged to Depwre-
ciation Account, as per
Journal Entry No. 21. . . .

Buildings

Furniture' and Fixtures ....

Machinery and Tools

Apparatus and Instruments

Ambulances, Live Stock, etc.
Total



Total.



Balance Estimated Depre-
ciation from previous year

Buildings Account

Furniture and Fixtures Ac-
count

Machinery and Tools Ac-
count

Apparatus aod Instruments
Account

Ambulances, Live Stock,
etc.. Account



Total.



Estimated depreciation ac-
crued during year ending
, as per Journal En-
try No. 20

Buildings Account

FiuTiiture and Fixtures Ac-
count

Machinery and Tools Ac-
count

Apparatus and^Instruments
Account

Ambulances, Live Stock,

etc.. Account

Total

Total



Cb.



The above "Reserve for Depreciation" will cease to exist unless there remains
a balance on the credit side, which represents the amount of this "Reserve for
Depreciation of Hospital Properties and Equipment," as shown on the Books and
on the Balance Sheet.



16. ENDOWED BED FUND ACCOUNT
De.

Total from previous month § Total from previous month

Amount charged off En- Cash received to fully En-
dowed Bed Fund during dow Beds dm-ing month,
month and credited to as per Treasurer's Cash
Surplus and Deficit Ac- Book



Cb.



TREASURER'S GENERAL LEDGER ACCOUNTS 83

16. ENDOWED BED FUND ACCOUNT— Continued

Dr. Cb.

count, liability of Hospital Amounts transferred from

having ceased, as per "Partly Endowed Bed

Journal Entry 12 Fund" during month,

accoimt completion of
such endowments as per

Journal Entry 11

Total Total

Difference in totals equals "Endowed Bed Fund," as shown on Books and on
Balance Sheet.

Note — When beds are endowed at the Presbyterian Hospital it is the practice
to credit such endowments to "Endowed Bed Fund Account" and to keep the
amounts received invested ia income bearing seciuities, as long as any nominor
has the right to name patients to occupy such beds.

In case, however, the right to name patients to occupy a bed should lapse,
either by expiry of the term of the endowment or by death of the nominor without
having appointed in writing a successor, the liability of the hospital, as regards that
particular endowment, is considered to have ceased and the endowment is there-
after treated as imrestricted and is credited as per Journal Entry No. 12 to " Surplus
and Deficit Account," if such action is approved by the Board of Managers. A
Suitable entry is also made on the Treasurer's Endowed Bed Ledger Accounts as
described on pages 99 and 100.

17. PARTLY ENDOWED BED FUND ACCOUNT

De. Cr.

Total from previous month § Total from previous month

Amounts Transferred to Cash received account Part-

Endowed Bed Fund, dur- ly Endowed Bed Fund

ing month, account en- diu-ing month, as per

dowments completed, as Treasurer's Cash Book

per Journal Entry 11

Amounts charged off partly
Endowed Bed Fimd dur-
ing month, and credited
to Surplus and Deficit
Account account liability
of Hospital having ceased,

as per Journal Entry 12

Total Total

Difference in totals equals "Partly Endowed Bed Fxmd," as shown on Books

and on Balance Sheet.

Note — Instalments received to partly endow beds are subject at any time to
transfer to "Endowed Bed Fund Account" upon completion of such endowments.
There is usually no liability on the part of the Hospital to furnish free treatment
on such beds until they are fully endowed. No investments are therefore assigned
to offset amounts standing to credit of "Partly Endowed Bed Fund Account"
and no income from this Account is therefore shown in Schedule 1.



84



TREASURER'S GENERAL LEDGER ACCOUNTS



18. GENERAL ENDOWMENT FUND ACCOUNT

State in detail purposes and conditions of this Fund, as for instance, "Principal
to be invested and income only to be used for meeting Operating Expenses"
(Schedule 2).

Cb.



Db.

Total from previous month

Amount charged off this
account during month
and credited to Surplus
and Deficit Accoimt, lia-
bility of Hospital having
ceased, as per Journal En-
try 12

Total ."T"

Difference in totals equals "General Endowment Fund," as shown on Books

and on Balance Sheet.

19. X. Y. Z. \TSITING NURSING FUND ACCOUNT

State in detail purposes and conditions of this Fund, as for instance. Principal
to be used for all expenses in connection with work of Visiting Nurses.
Dh.



§ Total from previous month
Cash received during month
for this Accoimt, as per
Treasurer's Cash Book. . .
Value of Investments given
to Hospital during month,
for this Account as per

Journal Entry 9

Total



Cb.



Total from previous month
Appropriation during
month, for expenses
chargeable to this Fund, as
reported by Superintend-
ent, as per Journal Entry 4
Total



§ Total from previous month

Donations received during

month, for this Fund, as

per Treasurer's Cash Book



Total.



Difference in totals equals the amount of this Fund, as shown on Books and
on Balance Sheet.

20. A. B. C. PATHOLOGICAL DEPARTMENT FUND ACCOUNT

State in detail purposes and conditions of this Fund, as for instance, " Principal
or Income may be used for subscriptions to Periodicals, or for Purchase of Apparatus
or Instruments for the Pathological Department."
Dh. Cb.



Total from previous month
Appropriation during
month for expenses
chargeable to this Fund,
as reported by Superin-
tendent, as per Journal
Entry 4



§Total from previous month

Donations received during
month for this Fund, as
per Treasurer's Cash Book

Cash received during month,
account Income from in-
vestments held in this
Fund, as per Treasurer's
Cash Book

Amount of Income from In-
vestments held in this



TREASURER'S GENERAL LEDGER ACCOUNTS 85

20. A. B. C. PATHOLOGICAL DEPT. FUND ACCOUNT— Contimied
Dr. Cr.

Account accrued and due
during month and unpaid
and transferred to "Ac-
counts Receivable," as

per Journal Entry 18

Value of Investments given
to Hospital during month,
for this Fund as per Jour-
nal Entry 9

Total Total

Difference in totals equals the amount of this Fund, as shown on Books and
on Balance Sheet.

Note — The general Ledger Accounts, "Endowed Bed Fund," "General En-
dowment Fund" or other similar Funds, the income from investments held in
which is to be used only to meet current expenses and is not to be added to the
principal, are intended to show only the increase or decrease of the principal of
Buch Capital Funds.

The investments assigned to each of such Funds and monthly income from
same is shown by an Income Ledger Account, as described on pages 95 and 96
and also in separate General Ledger Accounts referred to on page 74.

There are other General Ledger Accounts such as "X. Y. Z. Visiting Nursing
Fund," "A. B. C. Pathological Department Fund" or other similar Fund Accounts
in which the income from investments held in these funda as it falls due, is to be
added to and becomes a part of the principal.

Donations towards the principal of such Funds and income from investments
which may be held in such Funds, are therefore both credited to such General Led-
ger Fund Accounts and it is not necessary in such cases to keep additional General
Ledger Accounts to show the income only from such Funds. Income Ledger
Accounts, however, as described on pages 95 and 96 are kept where necessary to
show a list of investments assigned to such funds and the monthly income from same.

21. LOANS AND NOTES PAYABLE ACCOUNT
Db. Cb.

Total from previous month §Total from previous month

Loans paid during month, as Cash received during month

per Treasurer's Cash Book account Loans»incurred, as

Loans paid during month per Treasurer's Cash Book

by renewal, by signing of Loans renewed during

new notes, and cancella- month by signing of new

tion of old notes, as per notes and cancellation of

Journal Entry 13 old notes, as per Journal

Entry 13

Total Total

Difference in totals equals "Loans and Notes Payable," as shown on Books
and on Balance Sheet.

Note — "Mortgages Payable Account" may be treated in the same manner
as " Loans and Notes Payable Account."



86



TREASURER'S GENERAL LEDGER ACCOUNTS



22. SURPLUS AND
Db.

fTotal from previous month

Grand Total Current Ex-
penses, Schedule 2, during
month, as per Voucher
Register, as reported by
Superintendent, as per
Journal Entry 3

Total Capital Expenditures,
Schedule 3, during month,
as per Voucher Register,
as reported by Superin-
tendent, as per Journal
Entrj'3

Uncollectible Superintend-
ent's Accounts Receiv-
able charged oS during
month, as reported by
Superintendent, as per
Journal Entry 3

Uncollectible Treasurer's
Accounts Receivable
charged off during month,
as per Journal Entry 16

Loss or Depreciation of
General Material charged
off during month, as re-
ported by Superintendent,
as per Journal Entry 3

Loss or Depreciation
charged off Investment
Accounts or Current Asset
Accounts, Schedule 4,
during month, as per
Journal Entry 10

Amount to be credited to
" Capital Account " to rep-
resent increase of equity
of the Hospital in its Pro-
perties and Equipment
by reduction of Mortgages
Payable Account, as per
Journal Entry 23



Total.



DEFICIT ACCOUNT

jTotal from previous month

Grand Total Current Revenue,
Schedule 1, during month,
as per Journal Entry 4 . . .

Profit on Bonds, Stocks or
other Investments sold
during month, as per
Income Ledger, as per
Journal Entry 8

Profit on sale of "Sites and
Grounds," "Buildings" or
other Hospital Properties
and Equipment, as per
Journal Entry 6

Amount charged off En-
dowed Bed Fund, Partly
Endowed Bed Fund, or
Other Funds during
month, accoimt liability
of Hospital having ceased,
as per Journal Entry 12. .

Surplus amount of General
Material found to be on
hand during month as re-
ported by Superintendent,
as per Joiu'nal Entry 2. . .

Unclaimed Overpayments
by Patients, as per Jour-
nal Entry 2

Unclaimed TTages, as per
Journal Entry 2

Book Value of "Sites
and Grounds," "Buildings,"
"Furniture and Fixtures,"
"Machinery and Tools,"
"Apparatus and Instru-
ments," "Ambulances,
Live Stock, etc." or other
"Hospital Properties and
Equipment," Schedule 4,
sold during the month or for
amount collected during
month from Insurance Com-
panies for such properties
damaged or destroyed by
fire, as per Journal Entry 19
Total



Cb.



TREASURER'S INCOME LEDGER ACCOUNTS 87

Difference in totals equals "Surplus or Deficit" to date, as shown on Books and
on Balance Sheet.

"Deficit to date," if any, up to the amount of Reserve Fund Accounts will
represent the amoiint Reserve Fund Accounts, if any, have been encroached upon.

"Svirplus to date," if any, will represent the amount of surplus, which the
Hospital has to its credit, not including the value of any of its plant, which goes
to make up "Hospital Properties and Equipment."

*At the first of each fiscal year, under the headings in the Treasurer's General
Ledger of any of the accounts referred to on the debit side of the Balance Sheet
(Schedule 4), the balance sho-wn on the debit side of each account at the end of the
previous month should be sho'ft'n on the debit side only as "Balance at first of
year," instead of "Total from previous month."

§ At the first of each fiscal year under the headings in the Treasurer's General
Ledger of "Treasurer's Account with Superintendent," and any of the accounts
referred to on the credit side of the Balance Sheet (Schedule 4), the balance shown
on the credit side of each account at the end of the pre\-ious month should be shown
on the credit side only as " Balance at first of year " instead of " Total from previous
month."

t At the first of each fiscal year, under the heading in the Treasurer's General
Ledger "Surplus and Deficit Account," the amount of the "Surplus" or "Deficit
to date" at the end of the pre%aous month is the amount which should be shown
on the credit side of the accoimt, if a Surplus, or on the debit side of the account
if a Deficit, as "Balance at first of Year," instead of "Total from previous month."

TREASURER'S TRLAL BALANCE

The Treasurer's Trial Balance at the end of any month or year
is simply a transcript of the Balance Sheet (Schedule 4), in which,
opposite each of the headings shown is entered the balance as
shown by each account on the Treasurer's General Ledger at the
end of such month and in lieu of the balance shoT^ni by Treasurer's
Account with Superintendent such additional information from
the Superintendent's Trial Balance, as is needed to complete the
Balance Sheet. Opposite the word "Deficit" on the debit side,
or opposite the word "Surplus" on the credit side of the trial
balance must be entered "Deficit to date" or "Surplus to date,"
as the case may be, as shown by the "Surplus and Deficit" ledger
account. The final totals must then agree.

TREASURER'S INCOME LEDGER ACCOUNTS

In addition to the "General Ledger Accounts" referred to in
the preceding pages, the Treasurer should also keep separate
Income Ledger Accounts with each kind of Bonds, Stocks, other
Investments owned or Loan or Mortgage Receivable or Payable,



88 TREASURER'SINCOME LEDGER ACCOUNTS

SO as to show plainly the amount of the principal and income
or expenses on account of each.

In order to show what securities or other investments are
assigned to each Fund and the monthly income from same, sepa-
rate Income Ledger Accounts should be kept for each of these
Fund accounts. The income as it accrues is posted to such ac-
counts from the Treasurer's Cash Book, if paid, or by Journal
Entry, if not paid, as indicated in the sample of such an account
on pages 95 and 96.

These Income ledger Accounts do not form any part of the
Treasurer's Balance Sheet and should not be confused with the
General Ledger Accounts.

The following Ulustrations will show how entries are made to
such accounts:



TREASURER'S INCOME LEDGER ACCOUNTS



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Online LibraryWilliam Van Schoonhoven ThorneHospital accounting and statistics → online text (page 8 of 11)