Problem:
Hospitals often have many different customers, not all whom make their payments on a timely basis. Millbridge hospital segments its customers into four groups: Medicare, Medicaid, insurance, and self-pay. The self-pay customers owe Millbridge hospital $2 million. Insurers owe twice that amount. Medicare and Medicaid owe $5 million and $3 million respectively. Half of Medicare receivable is current, 20% was billed more than 30 days but less than 61 days ago, and the balance was billed more than 60 days ago but less than 91 days. Medicaid's obligation is 30% current, 30% more than 30 days but less than 61 days, 30% more than 60 but less than 91 days, and 10% more than 90 days. The insurance receivable is half current and half 31 to 60 days. The self-pay receivables are 25% current, 25% in the 31 to 60 day category, 25% in the 61-90 day and 25% over 90 days. Prepare an accounts receivable aging schedule by total dollars and by percent.