Review the budget below and answer the questions following the budget.

Financial accounting—statement of revenue and expenses statement of revenue and expenses for group practice for year ending June 30, 2006

REVENUE

Patient service revenue ..........................$9,345,600

Less: Contractual ...................................$3,364,200

Total Net Service Revenue ....................$5,981,400

EXPENSES

Salaries ...................................................$2,628,500

Fringe benefits ...........................................$670,268

Temporary labor ........................................$150,000

Office supplies ............................................$78,000

Mortgage payments ...................................$195,000

Maintenance ................................................$32,900

Minor equipment .........................................$47,500

Insurance .....................................................$36,200

Interest ........................................................$23,200

Depreciation ..............................................$178,000

Miscellaneous ..............................................$15,000

Total Expenses .......................................$4,054,568

Net Income (profit/loss)

Over Expenses .........................................$1,926,83332.21%

UNIT 8 PROJECT

1. Another name for the statement of revenue and expenses financial accounting report is the statement of cash flows.

a. True

b. False

2. Assess the information presented in the medical group statement of revenues and expenses and calculate the operating margin for fiscal year 2006.

3. Although not included in the medical group practice statement of revenues and expenses, other forms of operating revenue might include interest from investments, research grants, or gifts and donations.

a. True

b. False

4. Describe two different types of accounting, the various activities that makes each unique, and the primary users of each accounting type.

5. You have just started a new job and will be leading organization-wide revenue cycle operations for a 300-bed hospital that employs 60 physicians in a multispecialty group practice. List and describe at least six individual revenue cycle processes you will evaluate, how each affects organizational financial performance, and what information you will use in your evaluation.