General Hospital, a not-for-profit acute care facility, has the following cost structure for its inpatient services: Fixed costs $1,093,754 Variable cost per inpatient day $19 Charge (revenue) per inpatient day $105
Q: What is the journal entry to record the bond interest payment if you do not have to neither a…
A: The objective of the question is to identify the correct journal entry to record the bond interest…
Q: Required: 1. For each listed transaction and related adjusting entry, indicate the accounts,…
A: Accounting Equation is a summary in which the effect of each transaction on the balance sheet is…
Q: Landry State University, a public university located in Louisiana, has a June 30 fiscal year. On…
A: Journal entry records the accounting transactions of a business in a journal book. All the business…
Q: Exercise 13-4 (Algo) Special Order Decision [LO13-4] imperial Jewelers manufactures and sells a gold…
A: The special orders are normally not regular in nature. Special orders require different attention to…
Q: Acme Products, Inc. is interested in producing and selling an improved widget. Market research…
A: TOTAL COSTTotal Cost is the cost incurred to manufacturing a product.Total Cost Includes Cost of Raw…
Q: Bennette Corporation has provided the following data concerning its overhead costs for the coming…
A: Activity Rate :— It is the rate used to allocate manufacturing overhead cost to cost object under…
Q: What of the following is not a step in the general ledger and financial reporting cycle? a. Prepare…
A: The accounting cycle is a set of procedures or processes used by firms to record, categorize, and…
Q: Machinery was bought October 2,2021. Machinery costing $182 900 inclusive of $600 installation…
A: The sum-of-year-digit (SYD) method is an accelerated method for recording depreciation expense. It…
Q: Garrett Company has the following transactions during the months of April and May: Date April 1 17…
A: "Since you have posted multiple questions with multiple sub parts,we will provide the solution only…
Q: At December 31, the records of Kozmetsky Corporation provided the following selected and incomplete…
A: Shares or stocks are important in the financial markets because they allow corporations to obtain…
Q: At the beginning of April, Winslow Toy Company budgeted 14,000 toy action figures to be manufactured…
A: Direct costs are the expenses that are directly used for the production of goods and services for…
Q: lannon University, a private, nonprofit university, receives a letter from an alumnus who pledges…
A: A not-for-profit organization is an enterprise established with a service motive. The main purpose…
Q: Besides preparing annual financial statements, how do managers use accounting information
A: Financial statement is a formal record of the financial activities and position of a business,…
Q: Use the following information for the Exercises below. (Algo) [The following information applies to…
A: Depreciation -The depreciation expense is charged on the fixed assets as reduction in the value of…
Q: If the beginning inventory for 2025 is overstated, the effects of this error on cost of goods sold…
A: As the beginning inventory is Overstated results in total cost of goods sold of the company will get…
Q: The following are transactions between Crane Corp, the consignor, and Blossom Stores Ltd, the…
A: Under a consignment sales agreement, a consignee acts only as an agent for the consignor. The owner…
Q: SkyChefs, Inc., prepares in-flight meals for a number of major airlines. One of the company's…
A: Direct labor variance is the difference between standard direct labor cost for actual production and…
Q: Evans & Sons, Inc., disclosed the following information in a recent annual report: Previous Year…
A: Lets understand the basics.RETURN ON COMMON SHAREHOLDERS EQUITYReturn on Shareholders Equity is the…
Q: Direct materials (plastic) Direct labor Variable manufacturing overhead (based on direct labor…
A: Variance arises when the actual costs is different from the standard costs. The results are…
Q: Giorgio Italian Market bought $10,600 worth of merchandise from Food Suppliers and signed a 90- day,…
A: Journal Entry :— It is an act of recording transactions in books of account when transaction…
Q: Han Products manufactures 25,000 units of part S-6 each year for use on its production line. At this…
A: Information on cost per unit is required to set prices high enough to turn a profit. The cost per…
Q: The following are selected 2025 transactions of Sheridan Corporation. Sept. 1 Oct. 1 Oct. 1 (a)…
A: Journal entries consist of all the business financial transactions. They are recorded in…
Q: Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as…
A: A Segmented Contribution Margin Income Statement provides a breakdown of the contribution margin for…
Q: SkyChefs, Inc., prepares in-flight meals for a number of major airlines. One of the company's…
A: Standard hours are the estimated number of hours expected to be spent in the making of the units. It…
Q: The annual budget for Vasconcellos Manufactures for 2023 is the following: Direct…
A: Predetermined Overhead Rate is the rate used to allocate manufacturing overhead cost to cost object…
Q: The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a…
A: Lost contribution margin -$101,000Fixed costs that can be avoided: Advertising, traceable…
Q: The company issues 9%, 10-year bonds with a total face amount of $100,000. The market interest rate…
A: When the market rate of interest is higher than the stated rate of interest, the bond will be issued…
Q: Mary and Scott formed a partnership that maintains its records on a calendar-year basis. The balance…
A: In case of capital interest receipt it will be the gain or Loss will be recognized But where as for…
Q: Adger Corporation is a service company that measures its output based on the number of customers…
A: Activity variance is the difference between values as per the static budget and the flexible budget.…
Q: Davis Corporation manufactures a single product. The selling price is $340 per unit, and variable…
A: Margin of safety is the point after which profit will be happen in multiple of contribution margin…
Q: Presented below are two independent situations: a) On December 31, 2021, Legault Corporation had…
A: Bond refers to a debt instrument issued by a company or government entity to raise capital. It…
Q: Computing Depreciation with a Change in Depreciation Method Whitney Company purchased equipment on…
A: The depreciation expense is charged on the fixed assets as reduction in the value of the fixed…
Q: TB MC Qu. 09-92 (Algo) Marks Corporation has two operating... Marks Corporation has two operating…
A: Depreciation is the decrement in the value of tangible assets by the wear and tear during the…
Q: Presented below is information for Skysong, Inc. for the month of January 2022. Cost of goods sold…
A: Income statement is a financial statement that shows profitability, total revenue and total…
Q: Employers are responsible for paying FICA taxes, but are not responsible for paying state and…
A: FICA taxes fund Social Security and Medicare, with employers and employees each contributing a…
Q: Cash Sales Sales on account Total sales January February March 5,000 6,000 10,000 12,000 4,000…
A: CASH BUDGET Cash Budget is a detailed budget of cash income and cash expenditure incorporating both…
Q: The DuPont framework for financial statement analysis of a business focuses on the areas of…
A: The DuPont framework is a financial analysis method that deconstructs a company's return on equity…
Q: Sohr Corporation processes sugar beets that it purchases from farmers. Sugar beets are processed in…
A: Lets understand the basics.When more than one product gets produced from a single process then all…
Q: Lightning Electronics is a midsize manufacturer of lithium batteries. The company’s payroll records…
A: Payroll expenses refer to the costs associated with compensating employees for their work. These…
Q: Winthrop Company has an opportunity to manufacture and sell a new product To pursue this…
A: The question is related to Capital Budgeting. The Net Present value is calculated with the help of…
Q: Flint, Inc. provided the following information: Projected merchandise purchases . . March $67,000…
A: Budgeting is the process of estimating future operations based on past performance. % are estimated…
Q: Sedona Company set the following standard costs for one unit of its product for this year. Direct…
A: Variable overhead Variance :— It is the difference between standard variable overhead applied and…
Q: At May 31, 2019, Acai Associates reported the following amounts (in millions) in its financial…
A: Debt to Asset Ratio: It refers to a leverage ratio that shows or reflects the proportion of debt a…
Q: Delta Company produces a single product. The cost of producing and selling a single unit of this…
A: The objective of the question is to determine the financial advantage or disadvantage of accepting a…
Q: Required information [The following information applies to the questions displayed below] On…
A: Depreciation: Generally speaking, the word "depreciation" refers to an accounting process that is…
Q: The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a…
A: Decision-making relating to discontinuance or continuance of a division is based on the costs and…
Q: On December 31, 2023, Berclair Incorporated had 200 million shares of common stock and 3 million…
A: Answer:- Earnings per share:- EPS is basically the ratio between the net profit earning by the…
Q: On April 1, 2023, Carla Vista Inc. entered into a cost plus fixed fee non-cancellable contract to…
A: The contract account is different from normal accounting as the completion of a contract goes beyond…
Q: From the following information complete an Income Statement for the year ended 30 June 2023 Accounts…
A: Income Statement :The income statement is an important financial statement of a company. It is also…
Q: Sheridan, Inc. buys 800 video game CDs from a distributor who is discontinuing those games. The…
A: Companies that produce goods use tools to calculate the costs of their production processes and the…
General Hospital, a not-for-profit acute care facility, has the following cost structure for its inpatient services:
| Fixed costs | $1,093,754 |
| Variable cost per inpatient day | $19 |
| Charge (revenue) per inpatient day | $105 |
The hospital expects to have a patient load of 1,599 inpatient days next year. Assume that 18 percent of the hospital's inpatient days come from a managed care plan that wants a 27 percent discount from charges. What is the change in profit if the hospital accepts the proposal?
Step by step
Solved in 4 steps
- The Two Cost Systems Sacred Heart Hospital (SHH) faces skyrocketing nursing costs, all of which relate to its two biggest nursing service linesthe Emergency Room (ER) and the Operating Room (OR). SHHs current cost system assigns total nursing costs to the ER and OR based on the number of patients serviced by each line. Total hospital annual nursing costs for these two lines are expected to equal 300,000. The table below shows expected patient volume for both lines. Calculate the amount of nursing costs that the current cost system assigns to the ER and to the OR.Jefferson Memorial Hospital is an investment center as a division of Hospitals United. During the past year, Jefferson reported an after-tax income of $7 million. Total interest expense was $3,200,000, and the hospital tax rate was 30%. Total assets totaled $70 million, and non-interest-bearing current liabilities were $22,800,000. The required rate of return established by Jefferson is equal to 18% of invested capital. What is the residual income of Jefferson Memorial Hospital?Sacred Heart Hospital (SHH) faces skyrocketing nursing costs, all of which relate to its two biggest nursing service linesthe Emergency Room (ER) and the Operating Room (OR). SHHs current cost system assigns total nursing costs to the ER and OR based on the number of patients serviced by each line. Total hospital annual nursing costs for these two lines are expected to equal 300,000. The table below shows expected patient volume for both lines. After discussion with several experienced nurses, Jack Bauer (SHHs accountant) decided that assigning nursing costs to the two service lines based on the number of times that nurses must check patients vital signs might more closely match the underlying use of costly hospital resources. Therefore, for comparative purposes, Jack decided to develop a second cost system that assigns total nursing costs to the ER and OR based on the number of times nurses check patients vital signs. This system is referred to as the vital-signs costing system. The earlier table also shows data for vital signs checks for lines. In an effort to better plan for and control OR costs, SHH management asked Jack to calculate the flexible budget variance (i.e., flexible budget costs - actual costs) for OR nursing costs, including the price variance and efficiency variance. Given that Jack is interested in comparing the reported costs of both systems, he decided to prepare the requested OR variance analysis for both the current cost system and the vital-signs costing system. In addition, Jack chose to use each cost systems estimate of the cost per OR nursing hour as the standard cost per OR nursing hour. Jack collected the following additional information for use in preparing the flexible budget variance for both systems: Actual number of surgeries performed = 950 Standard number of nursing hours allowed for each OR surgery = 5 Actual number of OR nursing hours used = 5,000 Actual OR nursing costs = 190,000 What does each of the calculated variances suggest to Jack regarding actions that he should or should not take with respect to investigating and improving each variance? Also, briefly explain why the variances differ between the two cost systems.
- Health-Temp Company is a placement agency for temporary nurses. It serves hospitals and clinics throughout the metropolitan area. Health-Temp Company believes it will place temporary nurses for a total of 23,500 hours next year. Health-Temp charges the hospitals and clinics 90 per hour and has variable costs of 75.60 per hour (this includes the payment to the nurse). Total fixed costs equal 321,000. Required: 1. Calculate the contribution margin per unit and the contribution margin ratio. 2. Calculate the sales revenue needed to break even. 3. Calculate the sales revenue needed to achieve a target profit of 100,000. 4. What if Health-Temp had target operating income (profit) of 110,000? Would sales revenue be larger or smaller than the one calculated in Requirement 3? Why? By how much?The Two Cost Systems Sacred Heart Hospital (SHH) faces skyrocketing nursing costs, all of which relate to its two biggest nursing service linesthe Emergency Room (ER) and the Operating Room (OR). SHHs current cost system assigns total nursing costs to the ER and OR based on the number of patients serviced by each line. Total hospital annual nursing costs for these two lines are expected to equal 300,000. The table below shows expected patient volume for both lines. After discussion with several experienced nurses, Jack Bauer (SHHs accountant) decided that assigning nursing costs to the two service lines based on the number of times that nurses must check patients vital signs might more closely match the underlying use of costly hospital resources. Therefore, for comparative purposes, Jack decided to develop a second cost system that assigns total nursing costs to the ER and OR based on the number of times nurses check patients vital signs. This system is referred to as the vital-signs costing system. The earlier table also shows data for vital signs checks for lines. Calculate the amount of nursing costs that the vital-signs costing system assigns to the ER and to the OR.General Hospital, a not-for-profit acute care facility, has the following cost structure for its inpatient services Fixed $10,000,000 Variable cost per inpatient day 200 Charge (revenue) per inpatient day 1000 The hospital expects to have a patient load of 15,000 inpatient days next year. a. Construct the hospital’s base case projected P&L statement. b. What is the hospital’s breakeven point? c. What volume is required to provide a profit of $1,000,000? A profit of $500,000? d. Now, assume that 20 percent of the hospital’s inpatient days come from a managed care plan that requests a 25 percent discount from charges. Should the hospital agree to the discount proposal?
- The hospital’s fixed costs are $38 million: What is the hospital’s net income? Assume that half of the 100,000 covered lives in the commercial payer group will be moved into a capitated plan. All utilization and cost data remain the same. What PMPM rate will the hospital have to charge to retain their Part a net income? What overall net income would be produced if the admission rate of the capitated group were reduced from the commercial level by 10 percent? Assuming that the utilization reduction also occurs, what overall net income would be produced if the variable cost per admission for the capitated group were lowered to $2,200?Charity Hospital, a not-for-profit, has a maximum capacity of 15,000 discharges per year. Variable patient service costs are $495 per discharge. Variable general and administrative costs are $5 per discharge. Fixed hospital overhead costs are $4,000,000 per year. The current reimbursement rate is $1,000 per discharge. a. What is Charity’s breakeven volume in number of discharges? b. Now assume Charity’s total discharges for 2014 totaled 10,000. In late 2014, a specialty cardiac hospital opened near Charity, so that discharges in 2015 will reach only 8,500. Management is planning cut fixed costs so that the total for 2015 will be $1,000,000 less than in 2014. Management is also considering reducing variable staffing costs in order to earn a target profit that will be the same dollar amount as the profit earned in 2014. Charity has already had 4,000 discharges in 2015 at a reimbursement rate of $1,000 per discharge with variable costs unchanged. What contribution margin per unit is…Bluegrass Community Hospital (BCH) has the following payer groups: Number of Admissions Average Revenue per Admission Variable Cost per Admission Commercial 1,000 $5,000 $3,000 BCBS 4,000 $4,500 $4,000 Medicare 8,000 $7,000 $2,500 Given: BCH annual fixed costs are $38M What is BCH’s net income? If half of the 100,000 covered lives in the Commercial group moved to a capitated rate and utilization and cost data remained the same, what PMPM rate should be charged to maintain the Commercial group net income share? What would BCH net income be if the Commercial capitated group admissions decreased by 10%? What would BCH net income be if the Commercial capitated group admissions decreased by 10% and variable costs for the Commercial capitated group decreased to $2,200?
- Citizen Hines HMO uses primary care provider (PCP) contracts that set the PCP capitation rate at $15 per member per month (PMPM). Citizen Hines also contributes $45 PMPM to an institutional inpatient services risk pool and $30 PMPM to a specialist services risk pool. In addition, the contract includes a provision requiring a 20% withhold. Suppose the amount of Physician B's compensation withheld amount is 20% and their specialty services budget was $400,000 and incurred $412,000 in actual specialty expenses. If the distribution from the risk pool is based on individual behavior, what was her return from the risk pool at the end of the period?A not-for-profit hospital realizes a 3 percent return on its $200,000 investment in its home health unit. Its current revenue after discounts and allowances is $382,000. Administrative costs are $119,000, clinical personnel costs are $210,000, and supply costs are $47,000. Providing home health care is not a core goal of the hospital, and it will sell the home health unit if it cannot realize a return of at least 12 percent. A process improvement team has recommended changes to the home health unit's billing processes. The team has concluded that these changes could reduce costs by $20,000 and increase revenues by $5,000. Analyze the data that follow and assess whether the changes would make the home health unit profitable enough to keep. Old New Revenue 382,000 387,000 Cost 376,000 356,000 Profit…The NYU hospital has an arrangement with Queens College to provide hospital care to the QC’s members at a specific rate per member, per month. In April the QC paid the hospital $500,000 per agreement for patients treated in March. Based on pre-established billing rates, the hospital would have billed the QC $600,000. How much revenue should NYU recognized? $0 $500,000 $600, which is correct
