a. Calculate Riverside's financial ratios for 2014. Assume that Riverside had $1,000,000 in lease payments and...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
a. Calculate Riverside's financial ratios for 2014. Assume that Riverside had $1,000,000 in lease payments and $1,400,000 in debt principal repayments in 2014. (Hint: Use the book discussion to identify the applicable ratios.) b. Interpret the ratios. Use both trend and comparative analyses. For the comparative analysis, assume that the industry average data presented in the book are valid for both 2014 and 2015. A B C D E F G H J K L 1 Particulars 2015 2014 Benchmark Particulars 2015 2014 Particulars 2015 2014 2 Total Margin 7.5% 2.3% Current Assets Gross Patient Service Revenue 1,06,502 95,398 3 Operating Margin 5.8% 0.4% 3.4% Cash and Cash Equivalents 2,263 3,095 Less Provision for Bad Debt -3,328 -3,469 4 Return on Assets 6% 2% 5% Short Investments 4,000 2,000 1,03,174 91,929 5 Return on Equity 8% 2% Net Patients Receivables 21,840 20,738 Premium Revenue 5,232 4,622 6 Days Cash on Hand 8.14 11.51 212.00 Inventories 3,177 2,982 Other Revenue 3,644 6,014 7 Debt Ratio 29% 34% 150% 31,280 28,815 1,12,050 1,02,565 8 Debt to Equity 28% 33% 200% Non Current Assets Expenses 9 Debt to Capitalisation 41% 50% 34% PPE 1,45,158 1,40,865 Nursing Services 58,285 56,752 10 Fixed Asset Turnover 93% 86% 150% Accumulated Depreciation -25,160 -21,030 Dietary Services 5,424 4,718 11 Total Asset Turnover 74% 69% 100% Net PPE 1,19,998 1,19,835 General Services 13,198 11,655 12 Days in Receivables 77 82 48 1,51,278 1,48,650 Admin 11,427 11,585 13 Average age of Plant 6.09 11.00 Current Liabilities Employee Health and Welfare 10,250 10,705 14 Accounts Payable 4,707 5,145 Malpractice 1,320 1,204 15 Particulars 2015 Accrued Expense 5,650 5,421 Depreciation 4,130 4,025 16 Operating Income 6,474 Notes Payable 2,975 6,237 Interest 1,542 1,521 17 Depreciation 4,130 13,332 16,803 1,05,576 1,02,165 18 WC Changes -1,506 Long Term Liabilities Operating Income 6,474 400 19 Operating Cash Flow 9,098 Long Term Debt 28,750 30,900 Non Operating Income 2,098 1,995 20 Capital Lease Obligations 1,832 2,155 Net Income 8,572 2,395 21 PPE -4,293 Net Assets 1,07,364 98,792 22 Short Investments -2,000 1,51,278 1,48,650 23 Investing Cash Flow -6,293 24 25 Non Operating Income 2,098 26 Repayment of Debt -2,150 27 Repayment of Notes -3,262 28 Repayment of Capital Lease -323 29 Financing Cash Flow -3,637 30 31 Net Change 32 Opening 33 Closing 34 -832 3,095 2,263 a. Calculate Riverside's financial ratios for 2014. Assume that Riverside had $1,000,000 in lease payments and $1,400,000 in debt principal repayments in 2014. (Hint: Use the book discussion to identify the applicable ratios.) b. Interpret the ratios. Use both trend and comparative analyses. For the comparative analysis, assume that the industry average data presented in the book are valid for both 2014 and 2015. A B C D E F G H J K L 1 Particulars 2015 2014 Benchmark Particulars 2015 2014 Particulars 2015 2014 2 Total Margin 7.5% 2.3% Current Assets Gross Patient Service Revenue 1,06,502 95,398 3 Operating Margin 5.8% 0.4% 3.4% Cash and Cash Equivalents 2,263 3,095 Less Provision for Bad Debt -3,328 -3,469 4 Return on Assets 6% 2% 5% Short Investments 4,000 2,000 1,03,174 91,929 5 Return on Equity 8% 2% Net Patients Receivables 21,840 20,738 Premium Revenue 5,232 4,622 6 Days Cash on Hand 8.14 11.51 212.00 Inventories 3,177 2,982 Other Revenue 3,644 6,014 7 Debt Ratio 29% 34% 150% 31,280 28,815 1,12,050 1,02,565 8 Debt to Equity 28% 33% 200% Non Current Assets Expenses 9 Debt to Capitalisation 41% 50% 34% PPE 1,45,158 1,40,865 Nursing Services 58,285 56,752 10 Fixed Asset Turnover 93% 86% 150% Accumulated Depreciation -25,160 -21,030 Dietary Services 5,424 4,718 11 Total Asset Turnover 74% 69% 100% Net PPE 1,19,998 1,19,835 General Services 13,198 11,655 12 Days in Receivables 77 82 48 1,51,278 1,48,650 Admin 11,427 11,585 13 Average age of Plant 6.09 11.00 Current Liabilities Employee Health and Welfare 10,250 10,705 14 Accounts Payable 4,707 5,145 Malpractice 1,320 1,204 15 Particulars 2015 Accrued Expense 5,650 5,421 Depreciation 4,130 4,025 16 Operating Income 6,474 Notes Payable 2,975 6,237 Interest 1,542 1,521 17 Depreciation 4,130 13,332 16,803 1,05,576 1,02,165 18 WC Changes -1,506 Long Term Liabilities Operating Income 6,474 400 19 Operating Cash Flow 9,098 Long Term Debt 28,750 30,900 Non Operating Income 2,098 1,995 20 Capital Lease Obligations 1,832 2,155 Net Income 8,572 2,395 21 PPE -4,293 Net Assets 1,07,364 98,792 22 Short Investments -2,000 1,51,278 1,48,650 23 Investing Cash Flow -6,293 24 25 Non Operating Income 2,098 26 Repayment of Debt -2,150 27 Repayment of Notes -3,262 28 Repayment of Capital Lease -323 29 Financing Cash Flow -3,637 30 31 Net Change 32 Opening 33 Closing 34 -832 3,095 2,263
Expert Answer:
Answer rating: 100% (QA)
a To calculate Riversides financial ratios for 2014 we need to use the provided data Here are the calculations for the given ratios Total Margin Total Margin Net Income Gross Patient Service Revenue T... View the full answer
Related Book For
Corporate Finance A Focused Approach
ISBN: 978-1133947530
5th edition
Authors: Michael C. Ehrhardt, Eugene F. Brigham
Posted Date:
Students also viewed these finance questions
-
Riverside Memorials primary financial statements are presented in exhibits 17.1, 17.2, and 17.3. Calculate Riverside's financial ratios for 2019. Assume that Riverside had $1,000,000 in lease...
-
Park Ridge Homecare's financial statements are presented in Exhibits. we calculate selected ratios for 2008. a. Calculate the business's financial ratios for 2007. Assume that Park Ridge had $18,000...
-
Do you consider the Internet message boards that Anjali wishes to use to be public or private? How would you justify your answer? Anjali, was in her final year of study for an undergraduate business...
-
Explain relationships between common law and Romano-Germanic Civil Law.
-
Explain how a brand of a commonly purchased consumer packaged good, such as toilet tissue, could be skim-priced.
-
Defendant Monty J. Person began working for Garage Solutions, LLC, in March 2015. Three months into his employment, Person was sent by the owner of Garage Solutions, Mark Fontenot, to Rexburg, Idaho,...
-
Mammoth Corporation is considering a 3-for-2 stock split. It currently has the stockholders equity position shown. The current stock price is $120 per share. The most recent periods earnings...
-
Kevin made two investments over the past two years. His first investment wasabaseball card thatcost$50.00,whichhe sold three months later for$55.00.The second wasashare of stockinastart-upcompany....
-
The stock market is valuing AEL richly with high multiples. What evidence do you see in its strategy and financial performance to support such market optimism? 2. Why do you think Hindenburg picked...
-
Compare and Contrast-Which do you prefer and why(buttress your point with a mathematical calculation) RRSP VS TFSA
-
Problem 5. Find the matrix B of the linear transformation T() with respect to the basis B = (1, 2). 1. A = = = 2 = 10 3 4 2. A = = 4 3 = Ax
-
Q5 Question 5 Corporate Governance: Directors' duties (10 marks) What is a fiduciary duty and what specific fiduciary duties does the law impose on company directors generally and under the...
-
Q5- Show that the following matrix is not diagonalizable. (5 marks) 11-1 A = 2 0 3-3 2 5
-
A taxable capital gain is calculated as: capital gain x capital gains inclusion rate. The current capital gains inclusion rate is 50%. Samantha realized a capital gain of $50,000 when she sold her...
-
2.6 For the mechanical system shown in Fig.2.6, determine the transfer function between the input displacement x and the output displacement y. y K Fig. P2.6 C.
-
Prove the formula for (d/dx)(cos-1x) by the same method as for (d/dx)(sin-1x).
-
The use of Torrens certificates, never large in the U.S., has diminished in recent years. Explain how marketable title laws, recently adopted in many states, might have made Torrens certificates less...
-
Why might it be advisable to require a survey in purchasing a 20-year-old home in an urban subdivision?
-
If a grantee obtains title insurance, what value, if any, is there in the covenant of seizen in a warranty deed?
-
Show that for a gas of noninteracting bosons, or fermions, the pair correlation function \(g(r)\) is given by the expression \[g(r)=1 \pm \frac{g_{s}}{n^{2} h^{6}}\left|\int_{-\infty}^{\infty}...
-
Show that, in the case of a degenerate gas of fermions \(\left(T \ll T_{F} ight)\), the correlation function \(g(r)\), for \(r \gg \hbar / p_{F}\), reduces to the expression \[g(r)-1=-\frac{3(m k...
-
Show that the pressure and Helmholtz free energy of a fluid at temperature \(T\) can be determined by performing a thermodynamic integration of the inverse of the isothermal compressibility from the...
Study smarter with the SolutionInn App