HCA 312 Ashford University Financial and Operating Ratios Template

Description

 

 

Financial and Operating Ratios

[WLOs: 1, 2, 3, 4] [CLOs: 1, 2, 3, 4, 5]

, review the Comprehensive Assessment of Firm Financial Performance Using Financial Ratios and Linguistics Analysis of Annual Reports article and the Financial Ratios web page. You will also utilize Appendices 13A, 13B, 13C, and 33A as well as Dr. Smith and Dr. Brown’s financial statements. As the Practice Manager, you will be utilizing Dr. Smith and Dr. Brown’s Physician Practice financial statements for completing the financial ratio calculations below to determine the feasibility of a capital expenditure.

After reviewing, download the Financial and Operating Ratios  template. You will be responsible for entering your responses directly into the template provided. You will need to ensure that your responses are thorough, examples are given where indicated, and references are listed in APA format in the space provided within the template. In the assignment template provided, complete Parts 1 through 5.

Part 1: Calculations of Financial Ratios

Calculate the financial ratios for Dr. Smith and Brown’s physician practice to analyze the financial viability of the organization.

Identify the type of ratio for each of the following:

Current ratio

Quick ratio

Debt Service Coverage ratio (DSCR)

Operating Margin

Return on Total Assets (ROTA)

Part 2: Type of Ratios

Define the type of ratios used in determining the financial viability of an organization.

Liquidity

Solvency

Profitability

Part 3: Operating Ratios

Define the financial ratios utilized to determine the financial status of Dr. Smith and Brown’s physician practice.

Compare the results in Part 1 with the median to determine the value associated with the financial ratio.

Analyze the results calculated in Part 1 and explain what the calculated result tells you about the financial health of Dr. Smith and Dr. Brown’s physician practice

Part 4: Capital Budgeting Expenditures – Time Value of Money Calculations

Calculate each of the operational ratios for Dr. Smith and Dr. Brown’s physician practice.

Present Value

Internal Rate of Return

Part 5: Evaluation of Capital Expenditures

Define the time value of money.

Provide a real-world example for the time value of money.

Explain why time is an important factor when considering a capital expenditure.

After review of the Dr. Smith and Dr. Brown’s financial statements and ratios, analyze the feasibility that the Capital Expenditure listed above would benefit Dr. Smith and Dr. Brown’s practice. Explain your rationale on whether you would recommend the purchase of the capital expenditures identified. Include any positive or negative aspects of regulatory or government mandates that were considered in making the decision to purchase the capital expenditures.