$1.)$ How can ratios be used in determining the financial condition of a medical facility?

$2.)$ The year$-$end balance sheet of a hospital shows total liabilities of $$5,500,000,$ including a bank note to expand the facility. Net worth of the hospital is $$3,000,000.$ What is the debt$-$to$-$net$-$worth ratio?

$3.)$ Using the following data, calculate the medical facilities$$ current ratios.

Based on the current ratios, which of the following medical facilities is the healthiest financially?

In Millions

Delphy Medical Facility

Johnson Medical Facility

Aztric Medical Facility

Current Assets

$$18,000$

$$29,000$

$$18,000$

Current Liabilities

$$24,000$

$$30,000$

$$28,000$

Quick Ratio

$4.)$ Mrs$.$ Foster meets with her family physician complaining of flu$-$like symptoms that have continued for almost a week. She has group health insurance through her employer, with the contract requiring a $$30\mathrm{.}00$ office visit copayment from the patient. The facility$$s standard billing rate for a routine office visit is $$150\mathrm{.}00.$ Complete the following journal entry to record the cash received from Mrs$.$ Foster, the amount due from the insurance company, and the medical services revenue:

The format titled accounting entry has columns for the account number and description on the left, and columns for debit and credit on the right. The description column lists cash, accounts receivable, and medical services revenue. The other three columns have been left blank.

$5.)$ Based on the facts in question $5,$ Mrs$.$ Foster$$s insurance company pays the contract rate of $$55\mathrm{.}00$ for the medical service. This is in addition to the patient$$s required copayment. Complete the following journal entry to record cash received, adjust medical services revenue, and clear the accounts receivable:

The format titled accounting entry has columns for the account number and description on the left, and columns for debit and credit on the right. The description column lists cash, accounts receivable, and medical services revenue. The other three columns have been left blank.

$6.)$ Dr$.$ Foster$$s primary care practice had net medical service revenue of $$500,000$ for the year. Salaries and benefits for the year, including draws for Dr$.$ Foster, were $$350,000.$ Other operating expenses, excluding payments on a bank loan, were $$100,000.$ Payments on the bank loan for the year were $$50,000$ on principal and $$20,000$ for interest. What was the net income for the practice for the year?

$7.)$ A home healthcare agency has a physician as the executive director and six employees providing direct care services to patients. The accounting records of the agency show the following items:

Salaries and overtime pay

$$425,000$

Social Security$/$Medicare paid by agency

$ $30,000$

Social Security$/$Medicare paid by employees

$ $30,000$

Employer deposits$$retirement savings

$ $15,000$

Employer contribution$$health insurance

$ $42,000$

$**$Calculate the total payroll expenses for this agency.$**$

$8.)$ Debt Service Coverage Ratio:

An equation for debt service coverage ratio shows net income plus interest, depreciation & amortization divided by maximum annual debt service or MADS, equals $168,500$ dollars divided by $50,000$ dollars equals $3\mathrm{.}37.$

Figure $7-5$

In Figure $7-5,$ the debt service coverage ratio for Lakeview Medical Clinic was calculated at $3\mathrm{.}37.$ Assume in the following year that Lakeview Medical$$s coverage ratio calculated at $1\mathrm{.}50.$ What factors would you review to analyze the change in the debt service coverage ratio?

$9.)$ In the $2020$ financial statements of Northport Regional Hospital, the hospital reported $$7,500,000$ in total revenues and $$285,000$ in net income. The balance sheet at December $31,2020,$ showed net assets of $$4,200,000.$ Calculate both the operating margin ratio and the return on equity ratio for Northport.

$10.)$ Dr$.$ Zinn is employed at Saunders Medical Practice. Dr$.$ Zinn is involved in teaching surgical technicians surgical skills so they are prepared to enter the workplace. Dr$.$ Zinn has to maintain a professional license along with a surgical certificate to meet the medical facility$$s educational requirement. This is an example of which type of exemption?