Healthcare Accounting Paper

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Accounting There are many types of accounting that are used in the financial world of healthcare everyday, in this paper I will be pointing out the comparison and contrast of each type of accounting known as namely accrual, cash flow, and fund accounting and I will also be delivering a brief detail paragraph on what type of entries they use, whether they use depreciation, or if inventory is accounted for, and also their differences, strengths and weaknesses. 7/12/2009 University of Phoenix Amanda Vick There are many types of accounting that are used in the financial world of healthcare everyday, in this paper I will be pointing out the comparison and contrast of each type of accounting known as namely accrual, cash flow, and…show more content…
And as far as depreciation, there really is no depreciation for cash accounting, but for accrual accounting there is depreciation, because in accrual accounting you are able to choose which method you would like to use, and with fund accounting it really pretty much depends on the type of fund whether it be debit or credit that you are operating in before you can consider depreciation as valid or not. Inventory is accounted for n all of the three types of accounting, accrual because it mainly relies on when the customer orders the inventory item from you even though the person did not pay for the item, they are still obligated by law to send you money so that you are able to recognize the purchase of the item, and in fund accounting, although some of the funds used in this method only recognize current assets and ignore long-term assets most of these funds will not have inventory, but a lot of them will. I believe that there is a difference between two of these organizations that adopted a particular accounting method this is that Accrual is a relatively complex method used, and it makes it more expensive to implement, which is the absolute complete opposite of cash flow, because cash flow is when transactions are recognized, that is only when there is an exchange of cash being made. The strengths and weaknesses of these various types of accounting methods are that the strengths are that all business that have these methods are able to keep track of all of the transactions, the products sold in their stores and the cash flow in and out of their businesses on a daily basis, and I really do not think that there are any weaknesses that come from any of these types of accounting, because to me by using each of these methods still puts money on the paycheck the only thing that could be a weakness is that if you work within a small business organization that does not

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