Williams Academic Medical Center Balance Sheet December 31, 20X0 and 20X1 (in thousands) 20X1 Current assets...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Williams Academic Medical Center Balance Sheet December 31, 20X0 and 20X1 (in thousands) 20X1 Current assets Cash and cash equivalents Patient accounts receivables, net Inventories Other current assets Total current assets Plant, property, and equipment Gross plant, property, and equipment (Less accumulated depreciation) Net property, plant, and equipment Long-term investments Total assets Current liabilities Accounts payable Salaries payable Notes payable Other current liabilities Total current liabilities Noncurrent liabilities Bonds payable Total noncurrent liabilities Owners' equity Total liabilities and equity $66,300 105,000 69,500 3,000 243,800 1,040,000 (254,000) 786,000 195,000 $1,224,800 $87,200 23,000 3,200 2,100 115,500 466,500 466,500 642,800 $1,224,800 20X0 $63,500 125,000 62,000 2,400 252,900 976,000 (326,000) 650,000 175,000 $1,077,900 $89,000 20,000 3,000 1,200 113,200 461,000 461,000 503,700 $1,077,900 EXHIBIT 4.30b INCOME STATEMENT FOR WILLIAMS ACADEMIC MEDICAL CENTER Williams Academic Medical Center Income Statement for the Years Ended December 31, 20X0 and 20X1 (in thousands) Revenues Net patient revenues Other operating revenues Total operating revenues Expenses Salaries and benefits Supply expenses Depreciation Purchased services Other expenses Interest Total operating expenses Income from operations Nonoperating income: Investment income and contributions Total Income before taxes (Less income taxes) Net income (loss) 20X1 $935,300 47,000 982,300 305,000 102,500 55,000 85,000 314,500 28,700 890,700 91,600 21,000 112,600 (45,040) $67,560 20X0 $735,200 35,600 770,800 325,000 105,000 32,800 84,000 172,000 12,500 731,300 39,500 19,000 58,500 (23,400) $35,100 CHAPTER 4 FINANCIAL STATEMENT ANALYSIS Key Equations EXHIBIT 4.16b FORMULAS FOR KEY FINANCIAL RATIOS Liquidity ratios Current ratio Quick rate Adid test ratio Days in accounts receivable Days cash on hand Average payment period, days Revenue, expense, and profitability ratios Return on total assets Return on net assets Formula Current Assets/Current Liabilities (Cash+Marketable Securities + Net Receivables)/Current Liabilities (Cash+Marketable Securities)/Current Liabilities Activity ratios Total asset turnover ratio Net fixed assets turnover ratio Age of plant ratio Net Patient Accounts Receivables/ (Net Patient Revenues/365) (Cash+Marketable Securities +Long-Term Investments) / [(Operating Expenses - Depreciation and Amortization Expenses)/365] Operating revenues per adjusted discharge" Operating expense per adjusted discharge Salary and benefit expense as percentage of operating expense Operating margin Nonoperating revenue ratio Capital structure ratios Long-term debt to net assets ratio" Net assets to total assets ratio Times interest earned ratio Debt service coverage ratio" Current Liabilities/ [(Operating Expenses- Depreciation and Amortization Expenses) / 365] Formula Total Operating Revenues / Adjusted Discharges Total Operating Expenses / Adjusted Discharges Total Salary and Benefit Expense / Total Operating Expenses Operating Income / Total Operating Revenues Nonoperating Revenues and Other Income / Total Operating Revenues Excess of Revenues over Expenses/Total Assets. Excess of Revenues over Expenses / Net Assets Formula Total Operating Revenues/Total Assets Total Operating Revenues / Net Plant and Equipment Accumulated Depreciation / Depreciation Expense Formula Long-Term Debt / Net Assets Net Assets/Total Assets (Excess of Revenues over Expenses + Interest Expense) / Interest Expense (Excess of Revenues over Expenses + Interest Expense + Depreciation and Amortization Expenses)/ (Interest Expense + Principal Payments) "Adjusted Discharges= (Total Gross Patient Revenue / Total Gross Inpatient Revenues) x Total Discharges. in for-profit health care organizations, calculated as Net Income / Total Assets. 'Called return on equity in for-profit health care organizations, and calculated as Net Income / Owners' Equity. "Called long-term debt to equity in for-profit health care organizations, and calculated as Long-Term Debt/Owners' Equity. "Called equity to total assets in for-profit health care organizations, and calculated as Owners' Equity / Total Assets. In for-profit health care organizations, calculated as (Net Income + Interest Expense) / Interest Expense. In for-profit health care organizations, calculated as (Net Income + Interest Expense + Depreciation and Amortizati Expenses)/(Interest Expense + Principal Payments). EXHIBIT 4.30b INCOME STATEMENT FOR WILLIAMS ACADEMIC MEDICAL CENTER Williams Academic Medical Center Income Statement for the Years Ended December 31, 20X0 and 20X1 (in thousands) Revenues Net patient revenues Other operating revenues Total operating revenues Expenses Salaries and benefits Supply expenses Depreciation Purchased services Other expenses Interest Total operating expenses Income from operations Nonoperating income: Investment income and contributions Total Income before taxes (Less income taxes) Net income (loss) 20X1 $935,300 47,000 982,300 305,000 102,500 55,000 85,000 314,500 28,700 890,700 91,600 21,000 112,600 (45,040) $67,560 20X0 $735,200 35,600 770,800 325,000 105,000 32,800 84,000 172,000 12,500 731,300 39,500 19,000 58,500 (23,400) $35,100 24. Horizontal, vertical, and ratio analyses. Exhibits 4.30a and 4.30b show the balance sheet and income statement for the 660-bed Williams Academic Medical Center for the years 20X0 and 20X1. Assume that principal payments each year come to $5,500,000 and that adjusted discharges are 120,000 for 20X0 and 125,000 for 20X1. a. Perform full horizontal and vertical analyses on the balance sheet. b. Perform full horizontal and vertical analyses on the income statement. c. Calculate every ratio described in the chapter for both years, and compare these ratios with the benchmarks (Exhibit 4.16a). Discuss Williams's current financial position and future outlook based on these results. Make the basis for the vertical analysis the year 20X0. Williams Academic Medical Center Balance Sheet December 31, 20X0 and 20X1 (in thousands) 20X1 Current assets Cash and cash equivalents Patient accounts receivables, net Inventories Other current assets Total current assets Plant, property, and equipment Gross plant, property, and equipment (Less accumulated depreciation) Net property, plant, and equipment Long-term investments Total assets Current liabilities Accounts payable Salaries payable Notes payable Other current liabilities Total current liabilities Noncurrent liabilities Bonds payable Total noncurrent liabilities Owners' equity Total liabilities and equity $66,300 105,000 69,500 3,000 243,800 1,040,000 (254,000) 786,000 195,000 $1,224,800 $87,200 23,000 3,200 2,100 115,500 466,500 466,500 642,800 $1,224,800 20X0 $63,500 125,000 62,000 2,400 252,900 976,000 (326,000) 650,000 175,000 $1,077,900 $89,000 20,000 3,000 1,200 113,200 461,000 461,000 503,700 $1,077,900 EXHIBIT 4.30b INCOME STATEMENT FOR WILLIAMS ACADEMIC MEDICAL CENTER Williams Academic Medical Center Income Statement for the Years Ended December 31, 20X0 and 20X1 (in thousands) Revenues Net patient revenues Other operating revenues Total operating revenues Expenses Salaries and benefits Supply expenses Depreciation Purchased services Other expenses Interest Total operating expenses Income from operations Nonoperating income: Investment income and contributions Total Income before taxes (Less income taxes) Net income (loss) 20X1 $935,300 47,000 982,300 305,000 102,500 55,000 85,000 314,500 28,700 890,700 91,600 21,000 112,600 (45,040) $67,560 20X0 $735,200 35,600 770,800 325,000 105,000 32,800 84,000 172,000 12,500 731,300 39,500 19,000 58,500 (23,400) $35,100 CHAPTER 4 FINANCIAL STATEMENT ANALYSIS Key Equations EXHIBIT 4.16b FORMULAS FOR KEY FINANCIAL RATIOS Liquidity ratios Current ratio Quick rate Adid test ratio Days in accounts receivable Days cash on hand Average payment period, days Revenue, expense, and profitability ratios Return on total assets Return on net assets Formula Current Assets/Current Liabilities (Cash+Marketable Securities + Net Receivables)/Current Liabilities (Cash+Marketable Securities)/Current Liabilities Activity ratios Total asset turnover ratio Net fixed assets turnover ratio Age of plant ratio Net Patient Accounts Receivables/ (Net Patient Revenues/365) (Cash+Marketable Securities +Long-Term Investments) / [(Operating Expenses - Depreciation and Amortization Expenses)/365] Operating revenues per adjusted discharge" Operating expense per adjusted discharge Salary and benefit expense as percentage of operating expense Operating margin Nonoperating revenue ratio Capital structure ratios Long-term debt to net assets ratio" Net assets to total assets ratio Times interest earned ratio Debt service coverage ratio" Current Liabilities/ [(Operating Expenses- Depreciation and Amortization Expenses) / 365] Formula Total Operating Revenues / Adjusted Discharges Total Operating Expenses / Adjusted Discharges Total Salary and Benefit Expense / Total Operating Expenses Operating Income / Total Operating Revenues Nonoperating Revenues and Other Income / Total Operating Revenues Excess of Revenues over Expenses/Total Assets. Excess of Revenues over Expenses / Net Assets Formula Total Operating Revenues/Total Assets Total Operating Revenues / Net Plant and Equipment Accumulated Depreciation / Depreciation Expense Formula Long-Term Debt / Net Assets Net Assets/Total Assets (Excess of Revenues over Expenses + Interest Expense) / Interest Expense (Excess of Revenues over Expenses + Interest Expense + Depreciation and Amortization Expenses)/ (Interest Expense + Principal Payments) "Adjusted Discharges= (Total Gross Patient Revenue / Total Gross Inpatient Revenues) x Total Discharges. in for-profit health care organizations, calculated as Net Income / Total Assets. 'Called return on equity in for-profit health care organizations, and calculated as Net Income / Owners' Equity. "Called long-term debt to equity in for-profit health care organizations, and calculated as Long-Term Debt/Owners' Equity. "Called equity to total assets in for-profit health care organizations, and calculated as Owners' Equity / Total Assets. In for-profit health care organizations, calculated as (Net Income + Interest Expense) / Interest Expense. In for-profit health care organizations, calculated as (Net Income + Interest Expense + Depreciation and Amortizati Expenses)/(Interest Expense + Principal Payments). EXHIBIT 4.30b INCOME STATEMENT FOR WILLIAMS ACADEMIC MEDICAL CENTER Williams Academic Medical Center Income Statement for the Years Ended December 31, 20X0 and 20X1 (in thousands) Revenues Net patient revenues Other operating revenues Total operating revenues Expenses Salaries and benefits Supply expenses Depreciation Purchased services Other expenses Interest Total operating expenses Income from operations Nonoperating income: Investment income and contributions Total Income before taxes (Less income taxes) Net income (loss) 20X1 $935,300 47,000 982,300 305,000 102,500 55,000 85,000 314,500 28,700 890,700 91,600 21,000 112,600 (45,040) $67,560 20X0 $735,200 35,600 770,800 325,000 105,000 32,800 84,000 172,000 12,500 731,300 39,500 19,000 58,500 (23,400) $35,100 24. Horizontal, vertical, and ratio analyses. Exhibits 4.30a and 4.30b show the balance sheet and income statement for the 660-bed Williams Academic Medical Center for the years 20X0 and 20X1. Assume that principal payments each year come to $5,500,000 and that adjusted discharges are 120,000 for 20X0 and 125,000 for 20X1. a. Perform full horizontal and vertical analyses on the balance sheet. b. Perform full horizontal and vertical analyses on the income statement. c. Calculate every ratio described in the chapter for both years, and compare these ratios with the benchmarks (Exhibit 4.16a). Discuss Williams's current financial position and future outlook based on these results. Make the basis for the vertical analysis the year 20X0.
Expert Answer:
Answer rating: 100% (QA)
To perform the requested analyses and calculations lets start with the full horizontal and vertical analyses of the balance sheet and income statement ... View the full answer
Related Book For
Financial Reporting And Analysis
ISBN: 9781260247848
8th Edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer
Posted Date:
Students also viewed these accounting questions
-
Gallinas Industries Balance Sheet December 31 Assets Liabilities and Stockholders' Equity Cash $40,000 Accounts payable $100,000 Marketable securities 60,000 Notes payable 30,000 Accounts receivable...
-
Current Assets 2000 2001 Cash 200 1 000 Accounts receivable 1 600 1 000 Inventory 2 200 2 600 TOTAL CURRENT ASSETS 4 000 4 600 Gross Fixed Assets 12 000 12 400 Less Accum Depreciation 6 000
-
Exhibit 6.18 presents the income statement and reorganized balance sheet for BrandCo, an $800 million consumer products company. Using the methodology outlined in Exhibit 6.5, determine NOPLAT for...
-
Graph each inequality or compound inequality. 5x - y > 6
-
Is Stern entitled to a discharge of his student loans on grounds of undue hardship? James Stern took out student loans to attend Bates College and Syracuse College of Law. Afterward, he had...
-
Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in 2017. In the process of setting up the business, Karane has acquired various types of assets. Below...
-
Discuss the role of culture in HRIS implementation. How might two different organizations with very different cultures approach the same HRIS implementation differently?
-
The following balance sheet for the Hubbard Corporation was prepared by the company: Additional information: 1. The buildings, land, and machinery are all stated at cost except for a parcel of land...
-
What novel insights can be gleaned from the burgeoning field of positive psychology regarding the cultivation of psychological strengths and virtues as a means of buffering against the detrimental...
-
Tracey White, the owner of the Buzz Coffee Shop chain, has decided to expand her operations. Her 2012 financial statements follow. Tracey can buy two additional coffeehouses for $3 million, and she...
-
Your firm is bidding on a contract to supply the federal government with aircraft parts for the next ten years. After all your costs are taken into account, the contract will yield $12,000 in profits...
-
If there is a surplus in the market for a product would this mean that the supply exceeds the demand for the product or that the quantity supplied exceeds the quantity demanded? Briefly explain your...
-
What measures have been taken to ensure the proper functioning of food commodity markets and their derivatives and facilitate timely access to market information, including on food reserves, to help...
-
Determine how your selected organization could address the ethical issue you have identified through leveraging corporate social responsibility.
-
If you Imagine yourself a senior analyst in the Office of Intelligence and Analysis within the Department of Homeland Security and your team has been tasked with compiling multiple sources of...
-
Suppose an economist estimates a demand equation. Quantity demanded is a function of the product's own price as well as prices of substitutes and complements. He finds that the own price reduces...
-
Assuming interest compounds annually at 3%, what is the present value of $12,000 to be received four years from now? 2. A company will receive a cash payment of $4,000 every six months for the next...
-
Borrowing costs should be recognised as an expense and charged to the profit and loss account of the period in which they are incurred : A. If the borrowing costs relate to qualifying asset B. If the...
-
Under Hart Companys accounting system, all insurance premiums paid are debited to Prepaid insurance. Hart then makes monthly charges to Insurance expense with credits to Prepaid insurance as the...
-
Dix Company reported operating income (loss) before income tax in its first three years of operations as follows: 20X1 .................... $ 100,000 20X2 ..................... (200,000) 20X3...
-
On January 1, 20X1, Mason Manufacturing borrows $500,000 and uses the money to purchase corporate bonds for investment purposes. Interest rates were quite volatile that year and so were the fair...
-
A blender does 5000 J of work on the food in its bowl. During the time the blender runs, 2000 J of heat is transferred from the warm food to the cooler environment. What is the change in the thermal...
-
Which system contains more atoms: 5 mol of helium (A = 4) or 1 mol of neon (A = 20)? A. Helium B. Neon C. They have the same number of atoms.
-
A sample of ideal gas is in a sealed container. The temperature of the gas and the volume of the container are both increased. What other properties of the gas necessarily change? (More than one...
Study smarter with the SolutionInn App