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Goodfellow & Perkins LLP is a successful mid-tier accounting firm with a large range of clients across Texas. During 2025, Goodfellow & Perkins gained a new client, Brookwood Pines Hospital (BPH), a private, not-for-profit hospital. The fiscal year-end for BPH is June 30. Goodfellow & Perkins is performing the audit for the fiscal year-end June 30, 2026. The balance sheets as of June 30, 2026 and 2025 are presented here. Brookwood Pines Hospital Balance Sheet (in thousands) June 30 Assets Cash and cash equivalents 5 7 Short term investments 3 3 D 1 2 Inventory 3 4 5 Patient accounts receivable, net Current portion of pledges and grants receivable, net Current portion of insurance recoverable Other current assets Total current assets $ 2026 43,077 $ 22,725 119,380 9,208 2,364 10,740 25,792 233,286 2025 36,361 49,338 99,962 5,099 1,953 10,056 23, 193 225,962 Long-term investments Property and equipment, net Prepaid pension cost Insurance recoverable, less current portion Other assets, net Total assets Liabilities and net assets Accounts payable Accrued salaries and benefits Grants payable, current portion Accrued expenses and other current liabilities Due to third-party payors Current accrued liabilities under self- insurance programs Current maturities of long-term debt Short-term debt Long-term debt subject to short-term refinancing agreements Total current liabilities Long-term debt, net, less current liabilities Accrued liabilities under self-insurance programs, less current portion. Grants payable, less current portion Other liabilities Total liabilities Net assets Without donor restrictions With donor restrictions Total net assets Total liabilities and net assets 807,321 538,981 7,248 10,723 28,463 $1,787,720 $1,618,698 915,088 576,432 $ 19,760 11,619 31,535 38,431 $ 39,547 52,361 50,754 6,459 8,459 19,209 72,494 15,709 5,040 14,550 224,253 220,796 82,618 13,245 42,669 583,581 27,380 67,687 14,965 4,928 53,132 266,852 179,530 82,559 16,489 48,336 593,766 962,652 62,280 1,138,140 65,999 1,204,139 1,024,932 $ 1,787,720 $ 1,618,698 Calculate the debt to net assets ratio for 2026 and 2025 and the percentage change in the ratio over the two-year period. Debt to net assets ratio Percentage change 2026 Evaluate Brookwood Pines Hospital's debt to net assets ratio. 48.5 cents of each dollar of 2025 BPH's debt to net assets ratio for 2026 indicates that about A high ratio indicates a(an) is financed with Goodfellow & Perkins LLP is a successful mid-tier accounting firm with a large range of clients across Texas. During 2025, Goodfellow & Perkins gained a new client, Brookwood Pines Hospital (BPH), a private, not-for-profit hospital. The fiscal year-end for BPH is June 30. Goodfellow & Perkins is performing the audit for the fiscal year-end June 30, 2026. The balance sheets as of June 30, 2026 and 2025 are presented here. Brookwood Pines Hospital Balance Sheet (in thousands) June 30 Assets Cash and cash equivalents 5 7 Short term investments 3 3 D 1 2 Inventory 3 4 5 Patient accounts receivable, net Current portion of pledges and grants receivable, net Current portion of insurance recoverable Other current assets Total current assets $ 2026 43,077 $ 22,725 119,380 9,208 2,364 10,740 25,792 233,286 2025 36,361 49,338 99,962 5,099 1,953 10,056 23, 193 225,962 Long-term investments Property and equipment, net Prepaid pension cost Insurance recoverable, less current portion Other assets, net Total assets Liabilities and net assets Accounts payable Accrued salaries and benefits Grants payable, current portion Accrued expenses and other current liabilities Due to third-party payors Current accrued liabilities under self- insurance programs Current maturities of long-term debt Short-term debt Long-term debt subject to short-term refinancing agreements Total current liabilities Long-term debt, net, less current liabilities Accrued liabilities under self-insurance programs, less current portion. Grants payable, less current portion Other liabilities Total liabilities Net assets Without donor restrictions With donor restrictions Total net assets Total liabilities and net assets 807,321 538,981 7,248 10,723 28,463 $1,787,720 $1,618,698 915,088 576,432 $ 19,760 11,619 31,535 38,431 $ 39,547 52,361 50,754 6,459 8,459 19,209 72,494 15,709 5,040 14,550 224,253 220,796 82,618 13,245 42,669 583,581 27,380 67,687 14,965 4,928 53,132 266,852 179,530 82,559 16,489 48,336 593,766 962,652 62,280 1,138,140 65,999 1,204,139 1,024,932 $ 1,787,720 $ 1,618,698 Calculate the debt to net assets ratio for 2026 and 2025 and the percentage change in the ratio over the two-year period. Debt to net assets ratio Percentage change 2026 Evaluate Brookwood Pines Hospital's debt to net assets ratio. 48.5 cents of each dollar of 2025 BPH's debt to net assets ratio for 2026 indicates that about A high ratio indicates a(an) is financed with
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To calculate the debt to net assets ratio for 2026 and 2025 we need to divide the total liabilities ... View the full answer
Related Book For
Auditing A Practical Approach with Data Analytics
ISBN: 978-1119401742
1st edition
Authors: Raymond N. Johnson, Laura Davis Wiley, Robyn Moroney, Fiona Campbell, Jane Hamilton
Posted Date:
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