The transactions listed in the following questions occurred in a private, not-for-profit hospital during 20X8. For each transaction, indicate its effect on the hospital's statement of operations for the year ended December 31, 20X8.
Transaction: The governing board designated assets for plant expansion.
Effect on Statement of Operations:
A) Increases operating income.
B) Decreases operating income.
C) The event is reported on the statement of operations, but there is no effect on operating income.
D) The event is not reported on the statement of operations.

Question

Quizplus · Accepted Answer

The designation of assets for plant expansion by the governing board is an internal decision and does not affect the statement of operations. It is not reported as it does not involve actual income or expenses.

The Transactions Listed in the Following Questions Occurred in a Private