16 Apr Week 8 Assignment 1 Fordsville Community Hospital Assignment 1: Ratio Analysis
APA format, In-text citation
Read number 1 and number 2 as instruction, then for number 1 completed the excel attachment
Ratio Template
| Week 8 Assignment 1 Ratio Template | |||||||||||||
| A | B | D | E | F | G | ||||||||
| (in '000) | |||||||||||||
| 12/31/22 | 12/31/23 | 2022 | 2023 | 2022 | 2023 | ||||||||
| Ratio[a] | [D/E] | [F/G] | Numerator | Denominator | Numerator | Denominator | |||||||
| Current Ratio | |||||||||||||
| Quick Ratio | |||||||||||||
| Acid Test Ratio | |||||||||||||
| Days in Accounts Receivable | |||||||||||||
| Days Cash on Hand | |||||||||||||
| Average Payment Period (Days) | |||||||||||||
| Operating Revenue per Adjusted Discharge | |||||||||||||
| Operating Expense per Adjusted Discharge | |||||||||||||
| Salary & Benefit Exp. as % of Operating Exp. | |||||||||||||
| Operating Margin | |||||||||||||
| Non-Operating Revenue | |||||||||||||
| Return on Total Assets | |||||||||||||
| Return on Net Assets | |||||||||||||
| Total Asset Turnover Ratio | |||||||||||||
| Fixed Asset Turnover Ratio | |||||||||||||
| Age of Plant Ratio | |||||||||||||
| Long-Term Debt to Net Assets | |||||||||||||
| Net Assets to Total Assets |
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© 2020 Laureate Education, Inc. Page 1 of 3
Healthcare Financial Management and Economics
Week 8 Assignment 1 — Fordsville Community Hospital
Assignment 1: Ratio Analysis
It is important to understand that when interpreting financial statements, the numbers alone may not provide the whole financial picture of an organization. Instead, you must analyze the statements using ratios, which are then compared to benchmarks across the healthcare industry. For this Assignment, you examine the financial documents for Fordsville Community Hospital and analyze the organization’s financial health.
Fordsville Community Hospital
Fordsville Community Hospital is a small community hospital serving a rural population. The adjusted discharges are 3.30 for the 1st year and 3.10 for the 2nd.
Fordsville Community Hospital Statement of Operations (in thousands) for the Years Ended December 31, 2018 and 2019
2018 2019
Revenues Net patient service revenue $23,000 $19,000 Net assets released from restriction 1,000 800 Total operating revenues 24,000 19,800
Expenses Salaries and benefits 13,000 9,000 Supplies and other expenses 7,000 6,000 Depreciation 2,500 2,000 General services 200 100 Total operating expenses 22,700 17,100
Operating income 1,300 2,700 Non-operating income 4,000 2,500
Excess of revenues over expenses 5,300 5,200
Increase (decrease) in net assets $5,300 $5,200
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Fordsville Community Hospital Balance Sheet (in thousands) for the Years Ended December 31, 2018 and 2019
2018 2019 Current assets Cash and cash equivalents
$700 $500
Net patient receivables 4,000 3,500 Inventory 950 750 Total current assets 5,650 4,750
Non-current assets Plant, property, and equipment Gross plant, property, and equipment
26,500 24,000
(less accumulated depreciation)
(18,000) (17,000)
Net plant, property, and equipment
8,500 7,000
Board-designated funds 18,000 9,000
Total assets 32,150 20,750
Current liabilities Accounts payable 2,500 2,000 Accrued expenses 900 250 Total current liabilities 3,400 2,250
Long-term liabilities Bonds payable 6,500 8,000 Total long-term liabilities 6,500 8,000
Net assets 22,250 10,500
Total liabilities and net assets
$32,150 $20,750
To prepare for this Assignment:
Examine the financial statements from Fordsville Community Hospital. Reflect on how you will use this financial data to calculate and analyze the organization’s financial ratios. Refer to Chapter 13 of Gapinski's Understanding Healthcare Financial Management for additional guidance.
© 2020 Laureate Education, Inc. Page 3 of 3
The Assignment:
Using the statement of operations and balance sheet for Fordsville Community Hospital, complete the “Week 8 Assignment 1 Ratio Excel Template”.
Your Assignment is due by Day 7 of Week 8.
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Healthcare Financial Management and Economics
Week 8 Assignment 2 — Northern Plains Imaging Center
Assignment 2: Break-Even Point Formulas
Before making hiring or purchasing decisions, healthcare organizations must consider whether the decision is financially profitable. By calculating break-even points, organizations are able to examine actual costs and make more sound financial decisions. For this Assignment, you use data from the Northern Plains Imaging Center and calculate break-even points.
Scenario: Northern Plains Imaging Center is a small imaging center with two analogue film or screen units. As the director of the center, Juanita Hernandez has been asked to determine if the current staffing is correct for her place or should she add another aide. She currently uses 2 mammography units, 2 Certified Technologists, and 1 aide. She has analyzed the current costs and determined the following: Reimbursement per screen $85 Equipment lease per month ($800 per machine) $1600 Certified Technologists costs per mammography ($25 per Tech) $50 Technologist aide per mammography $5 Variable cost per mammography $10 Equipment maintenance per month ($700 per machine) $1400
To prepare for the Assignment:
Examine the Northern Plains Imaging Center scenario. Reflect on how you will use the provided financial data to calculate break-even points. Refer to Chapter 11 of Gapinski’s Understanding Healthcare Financial Management for additional guidance.
The Assignment:
Given the above information, use the “Week 8 Assignment 2 Break Even Excel Template” to answer these items as a Department:
A. Solve for monthly volume to break even. B. Solve for monthly volume needed to break even at desired $5,000 per month
profit level. C. Solve for volume needed to break even at new reimbursement of $55 per screen
and no profit. D. Solve for volume needed to break even with one(1) additional aide.
Your Assignment is due by Day 7 of Week 8.
- Healthcare Financial Management and Economics
- Week 8 Assignment 2 — Northern Plains Imaging Center
