INPUT DATA:			Contractual
		Average	allowances,
	Payer	charge	discounts,
Payer	mix	per test	bad debts
Medicare	41%	$900	40%
Medicaid	17%	$700	35%
Blue Cross / Private insurance	17%	$1,000	50%
Managed care	14%	$800	45%
Self-pay	5%	$500	90%
Other	6%	$800	30%
Total	100%
Equipment cost	$300,000
Equipment installation	$30,000
Year 1 number of tests per year	600
Years 2-5 test volume growth rate	10%
Net patient revenue inflation rate	10%
Tests per 1.0 nurse FTE	750
Annual nurse salary & benefits	$100,000
Nurse salary & ben inflation rate	5%
Smith MOB Year 1-5 rent per year	$39,000
Omega REIT Year 1-2 rent per year	$36,000
Omega REIT Year 3-5 rent per year	$42,000
Annual maintenance costs	$50,000
Supplies cost per test	$20
Maint & sup cost inflation rate	3%
Salvage value	$100,000
Tax rate	21%
Pre-tax cost of capital	8%
	Yr 1	Yr 2	Yr 3	Yr 4	Yr 5	Yr 6
MACRS recovery allowances	20%	32%	19%	12%	11%	6%
MODEL-GENERATED DATA:
Test volume:
	0	1	2	3	4	5
Total number of tests per year		600	660	726	799	878
Net patient revenue:
			Contractual	Year 1
	Year 1		allowances,	net
	number		discounts	patient
Payer	of tests	Charges	bad debts	revenue
Medicare	$246	$221,400	$88,560	$132,840
Medicaid	102	$71,400	$24,990	$46,410
Blue Cross / Private insurance	102	$102,000	$51,000	$51,000
Managed care	84	$67,200	$30,240	$36,960
Self-pay	30	$15,000	$13,500.0	$1,500
Other	36	$28,800	$8,640	$20,160
Total	600	$505,800	$216,930	$288,870
	0	1	2	3	4	5
Average net patient revenue per test		$481	$491	$501	$511	$521
Net patient revenue		$288,870	$294,647	$300,540	$306,551	$312,682
Nursing cost:
	0	1	2	3	4	5
Nursing FTEs		1.0	1.0	1.0	2.0	2.0
Annual nurse salary & benefits		$100,000	$105,000	$110,250	$115,763	$121,551
Nurse cost		$100,000	$105,000	$110,250	$115,763	$121,551
Rent:
	0	1	2	3	4	5
Smith MOB		$39,000	$39,000	$39,000	$39,000	$39,000
Omega REIT		$36,000	$36,000	$42,000	$42,000	$42,000
After-tax cost of capital	6.32%
PV cost of rent (Smith MOB)	$162,862
PV cost of rent (Omega REIT)	$164,438
Maintenance and supplies:
	0	1	2	3	4	5
Maintenance		$50,000	$51,500	$53,045	$54,545	$56,181
Supplies
Cost per test		$20.00	$20.60	$21.22	$21.85	$22.51
Annual cost		$12,000	$13,596	$15,404	$17,453	$19,774
Total maintenance and supplies		$62,000	$65,096	$68,449	$71,998	$75,956
Net cash flows:
	0	1	2	3	4	5
Equipment cost	$300,000
Equipment installation	30,000
Net patient revenues		$288,870	$294,647	$300,540	$306,551	$312,682
Nursing cost		$100,000	$105,000	$110,250	$115,763	$121,551
Rent		$39,000	$39,000	$39,000	$39,000	$39,000
		$36,000	$36,000	$42,000	$42,000	$42,000
Maintenance and supplies		62,000	65,096	68,449	71,998	75,956
MACRS Depreciation		60,000	96,000	57,000	36,000	33,000
Operating income		($8,130)	($46,449)	($16,159)	$1,791	$1,176
Taxes		(1,707)	(9,754)	(3,393)	376	247
Net operating income		($6,423)	($36,694)	($12,766)	$1,415	$929
MACRS Depreciation		60,000	96,000	57,000	36,000	33,000
Salvage value						100,000
Tax on salvage value (calculated below)						0
Net cash flow	$330,000	$53,577	$59,306	$44,234	$37,415	$133,929

with information how to calculate the following:

Depreciable basis		$0
Years 1-5 MACRS depreciation		$0
Tax book value at end of year 5		$18,000
Salvage value at end of year 5		$0
Capital gain / (loss)		$0
Tax on salvage value		$0
Return on investment analysis:
After-tax cost of capital	6.32%
NPV	$0
IRR	0.0%
MIRR	0.0%
Breakeven analysis:
Volume
	NPV
Growth rate = 0%	$0
Growth rate = 5%	$0
Growth rate = 10%	$0
Time (payback)
	0	1	2	3	4	5
Annual cash flow	$0	$0	$0	$0	$0	$0
Cumulative cash flow	$0	$0	$0	$0	$0	$0
Payback	0.0	years
Abandonment value:
	0	1	2	3	4	5
Net cash flow	$0	$0	$0	$0	$0	$0
Net abandonment value		$0	$0	$0	$0
NPV if abandoned		$0	$0	$0	$0
After-tax cost of capital	0.00%