Horizontal vertical and ratio analyses exhibits 429a and

Question

Horizontal, vertical, and ratio analyses. Exhibits 4.29a and 4.29b show the statement of operations and balance sheet for Resort Hospital for 20X1 and 20X0. The debt principal payment each year for Resort is $1,300,000, and its adjusted discharges are 6,500 for 20X0 and 5,500 for 20X1.

a.Perform horizontal and vertical analyses on the balance sheet using the statement of operations.

b. Perform horizontal and vertical analyses using the balance sheet.

c. Compute all the selected ratios listed in Exhibit 4.16a.

Evaluate the financial state of Resort Hospital, a 60-bed facility, using all of the above measures. Make the basis for the vertical analysis the year 20X0.

Resort Hospital

Statement of Operations for the Years Ended December 31, 20X1 and 20X0 (in thousands)

Particulars	20x1	20x0
Revenues
Net patient service revenue	$33,500	$30,500
Other operating revenue	2,600	2,500
Total operating revenues	36,100	33,000
Expenses
Salaries and benefits	23,500	19,600
Supplies and other expenses	11,400	10,500
Depreciation	700	700
Interest	710	710
Total operating expenses	36,310	31,510
Operating income	(210)	1,490
Nonoperating revenue	6,500	1,200
Excess of revenue over expenses	$6,290	$2,690

Exhibit 4.27b Balance Sheet for Resort Hospital

Particulars	20x1	20x0
Current assets
Cash and cash equivalents	$1,500	$2,500
Net patient A/R	6,500	4,800
Inventories	400	350
Prepaid expense	350	250
Total current assets	8,750	7,900
Plant, property, and equipment
Gross plant, property, and equipment	22,000	19,500
Less Accumulated depreciation)	(12,700)	(12,000)
Net property, plant, and equipment	9,300	7,500
Long-term investments	16,500	10,500
Total assets	$34,550	$25,900
Current liabilities
Account Payable	$5,300	$3,800
Salaries payable	1,000	900
Total current liabilities	6,300	4,700
Long-term liabilities
Bonds payable	1,200	2,500
Total long-term liabilities	1,200	2,500
Net assets	27,050	18,700
Total liabilities and assets	$34,550	$25,900