Transaction. Center collects $2,000,000 in cash from outstanding accounts receivable. Analysis. Center collects cash, thus cash will go up by 2,000,000. Accounts receivable balance will go down because receivables in the amount of 2,000,000 have been paid out by patients/third parties. (Answer each transaction)
Transaction 1. The center purchased $2,000,000 on credit.
Transaction 2. The center provided $9,100,000 of patient services on credit.
Transaction 3. The center made a $200,000 cash principal payment toward its long-term debt.
Transaction 4. The center purchased new equipment using short-term notes payable. The purchase price is $1,000,000.
Transaction 5. The center incurred $51,000 in interest expense, which is paid in cash.