Financial Ratios for Patton-Fuller Community Hospital Essay examples

1233 Words Jul 28th, 2012 5 Pages
Patton-Fuller Community Hospital Ratio Computation 2009 and 2008 This paper will show the ratio computations to Patton-Fuller Community Hospital. From these computations, taken from the Unaudited and Audited Reports from 2009 and 2008, Team E will address significant changes, if any occurred, and address what Patton-Fuller Community Hospital plans are within the next year to five years regarding any changes. In closing this paper will address the reasons that our team agrees or disagrees with the CEO’s report presented to the Board. In addressing the ratio computations for 2009 and 2008, Unaudited and Audited reports, below, there were no significant changes between the two reports. From 2008 to 2009, the current assets …show more content…
The hospital should become a major player in the community it serves. This will put the hospital in a positive light with the community, and ultimately increase services provided which will increase the revenue of the hospital. In our final analysis, Team E agrees with the CEO’s report to the Board. The indicators are as follows: The audited report shows that the previous years losses had been turned into a gain, and Net Patient Revenues had grown to over 9%. Furthermore, the hospital took the necessary steps to the overall economic recession by holding an emergency meeting that allowed them to pay out their annual debt early.

Unaudited Report: Ratio Computations 2009-2008

Liquidity Ratio

1). Current Ratio: Assets/Liabilities

(2009) 128,867/23,807 = 5.37 (2008) 130,026 / 8,380 = 15.51

2). Quick Ratio: Cash and Cash Equivalents + Net Receivables/Current Liabilities

(2009) 22,995 + 59,787 / 23,807 = 3.44

(2008) 41,851 +37,666 / 8,380 = 9.49

3). Days Cash on Hand (DCOH): Unrestricted Cash and Cash Equivalents/Cash

Operation Expenses divided by Number of Days in Period (365)

Step 1 Total Operating Expenses -Depreciation

Step 2 Total from Step 1 365 (days)

Step 3 Cash & Cash Equivalents = days Total from Step 2

(2009) 462,982 –