Financial management course- mmha6160 week-2 assignment -finance 3.5

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Financial management course- mmha6160 week-2 assignment -finance 3.5

FINANCIAL MANAGEMENT COURSE- MMHA6160week-2 assignment -finance
3.5 Brandywine Homecare Homecare, a not-for-profit business, had revenues of $12 million in 2011. Expenses other than depreciation totaled 75 percent of revenues, and depreciation expense was $1.5 million. All revenues were collected in cash during the year and all expenses other than depreciation were paid in cash.     a. Construct Brandywine’s 2011 income statement.    b. What were Brandywine’s net income, total profit margin, and cash flow?    c. Now, suppose the company changed its depreciation calculation procedures (still within GAP) such that its depreciation expense doubled. How would this change affect Brandywine’s netincome, total profit margin, and cash flow?
    d. Suppose the change had halved, rather than doubled, the firm’s depreciation expense. Now,     what would be the impact on net income, total profit margin, and cash flow?
4.5 Consider the following balance sheet:_____________________________________________________________________________________                    Best Care HMO                Balance Sheet                June 30, 2011                (in thousands)_____________________________________________________________________________________AssetsCurrent Assets:Cash                        $2,737Net premiums receivable                                          821Supplies                    387      Total current assets                                               $3,945Net property and equipment            $5,924Total assets                                                                    $9,869
Liabilities and Net AssetsAccounts payable-medical services                         $2,145Accured expenses                                                             929Notes payable                                                                    382    Total current liabilities             $3,456Long-term debt                    $4,295     Total liabilities                $7,751Net assets-unrestricted(equity)                                                                          $2,118
Total liabilities and net assets                                   $9,869
a.    What is BestCare’s net working capital for 2011?b.    What is BestCare’s debt ratio?
4.6 Consider this balance sheet_____________________________________________________________________________________Green Valley Nursing Home, Inc.Balance SheetDecember 31, 2011_____________________________________________________________________________________AssetsCurrent Assets:   Cash                                $   105,737   Investments                                  200,000   Net patient accounts receivable                      215,600   Supplies                            87,655Total current assets                                                                       $   608,992   Property and equipment                    $2,250,000   Less accumulated depreciation                     356,000       Net property and equipment                                                         $1,894,000   Total assets                                                                                            $2,502,992
Liabilities and Shareholders’ EquityCurrent Liabilities:   Accounts payable                                                                               $       72,250   Accrued expenses                                                                                      192,900Notes payable                                                                                             180,000            Total current liabilities                                 $      445,150   Long-term debt                    $   1,700,000Shareholder’s Equity:Common stock, $10 par value                                                            $      100,000Retained earnings                                                                                          257,842       Total shareholders’ equity                                                            $      357,842
Total liabilities and shareholders’ equity                                         $  2,502,992
a.    How does this balance sheet differ from the one’s presented in Problem 4.5?b.    What is Green Valley’s net working capital for 2011?c.    What is Green Valley’s debt ratio? How does it compare with the debt ratios for Sunnyvale and BestCare?

 

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