Answer these questions briefly - Essay Example

BRIEF ANSWERS TO THE QUESTIONS What is the difference between gross revenues and net revenues? The difference between gross revenue and net revenue is that gross revenue it the total amount of money that is made by a business or a person from the sales of services and products without considering any deductions or expenditures while net revenue represents the amount of money that a business or a person remains with after taking away all the deductions or costs from the gross revenue.2) What is the difference between patient service revenue and other revenue?

Patient service revenue is that revenue that the health center generates or receives from treating patients while other revenue is defined as that revenue that an entity generates from carrying out their normal business activities particularly from the sale of services and goods. Other revenue is also known as turnover.3) What is the difference between charity care and bad debt losses? How is each handled on income statement? Charity care represents healthcare that is provided freely or at a reduced charges to patients with low income while bad debt losses represent those accounts receivables that cannot be collected and is therefore treated as a loss to the entity.

Charity care is charges one doesn’t expect to get paid while bad debts are charges one expects to get paid.In the income statements, bad debts are deducted from the revenue as operating expenses whereas charity care is not tallied as an expense but is usually considered a foot note at the bottom of the income statement.4) What are assets? Name three categories of assets? Assets are things purchased or acquired by an entity to be used in their operations and they have money value. They are basically used in generating revenue for the entity.

Assets can be:i) a claim that can be enforced against others for instance, accounts receivableii) a right, for instance, patent, copyright, trademarkiii) Something physical, for instance, inventory, cash, property, plant and equipment and land.iv) An assumption, for instance, goodwill.Assets can be categorized as i) Current assets such as cash and other liquid assetsii) fixed (long term assets)assets such as property plant and equipmentiii) Intangible assets such as goodwill, patent, copyrightiv) Prepaid and deferred assets; these are future costs expenditures such as rent, insurance, interestReferenceKapil, S. (2011). Financial management.

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