Compare and contrast the following items, pointing out their key elements: Gross revenue and
net revenue Patient service revenue and other revenue Charity care and bad debt losses on the
income sheet
Solution
Answer:
Patient Service Revenue should be expressed as gross revenue and net revenue.
Gross revenue represents the total gross charges for all services provided by the center.
Net revenue is the amount the health center expects to receive for services, and is equal to gross
charges less contractual allowances and sliding fee discounts.
Other sources of revenue may include interest, rent and donations and in-kind goods and
services.
Bad debt is considered an operating expense, whereas charity care is considered a foot note at the
bottom of the income statement and cannot be tallied as an expense.
Gross Revenue=Sales-COGS
Net Revenue=Revenue-Expenses
Net Revenue (also Revenue, Net Sales, or Sales) is the total revenue or gross revenue minus the
costs associated with returned or undelivered goods and commissions. So Net revenue is
calculated when gross revenue if first calculated. Both are interrelated to each other..
Compare and contrast the following items, pointing out their key ele.pdf
1. Compare and contrast the following items, pointing out their key elements: Gross revenue and
net revenue Patient service revenue and other revenue Charity care and bad debt losses on the
income sheet
Solution
Answer:
Patient Service Revenue should be expressed as gross revenue and net revenue.
Gross revenue represents the total gross charges for all services provided by the center.
Net revenue is the amount the health center expects to receive for services, and is equal to gross
charges less contractual allowances and sliding fee discounts.
Other sources of revenue may include interest, rent and donations and in-kind goods and
services.
Bad debt is considered an operating expense, whereas charity care is considered a foot note at the
bottom of the income statement and cannot be tallied as an expense.
Gross Revenue=Sales-COGS
Net Revenue=Revenue-Expenses
Net Revenue (also Revenue, Net Sales, or Sales) is the total revenue or gross revenue minus the
costs associated with returned or undelivered goods and commissions. So Net revenue is
calculated when gross revenue if first calculated. Both are interrelated to each other.
