Review the Week 8 Assignment 1 document provided to you by the Instructor. Examine the financial statements from the community hospital. Reflect on how you will use this financial data to calculate and analyze the organization’s financial ratios. Refer to Chapter 4 of Financial Management of Health Care Organizations: An Introduction to Fundamental Tools, Concepts and Applications for additional guidance.
The Assignment:
Using the statement of operations and balance sheet for the community hospital, complete the “Week 8 Ratio Excel Template”.
Healthcare Financial Management and Economics Week 8 Assignment 1 — Springfield Community Hospital
Assignment 1: Ratio Analysis
It is important to understand that when interpreting financial statements, the numbers alone may not provide the whole financial picture of an organization. Instead, you must analyze the statements using ratios, which are then compared to benchmarks across the healthcare industry. For this Assignment, you examine the financial documents for Springfield Community Hospital and analyze the organization’s financial health.
Springfield Community Hospital
Springfield Community Hospital is a small community hospital serving a rural population. The adjusted discharges are 3.30 for the 1st year and 3.10 for the 2nd.

Springfield Community Hospital
Statement of Operations (in thousands) for the Years Ended December 31, 2016 and 2017

2016
$21,000 1,000 22,000
Expenses
Salaries and benefits
Supplies and other expenses
Depreciation 2,300
2017
$17,000 800 17,800
8,000 5,000 1,900
100 15,000
2,800 2,200
5,000 $5,000
Revenues
Net patient service revenue
Net assets released from restriction
Total operating revenues
General services
Total operating expenses
Operating income Non-operating income
Excess of revenues over expenses Increase (decrease) in net assets
200 20,500
1,500 3,500
5,000 $5,000
12,000 6,000

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Springfield Community Hospital
Balance Sheet (in thousands) for the Years Ended December 31, 2016 and 2017
Current assets Cash and cash

equivalents
Net patient receivables
Inventory 900
Total current assets
Non-current assets Plant, property, and equipment
Gross plant, property, and equipment
(less accumulated depreciation)
Net plant, property, and equipment
Board-designated funds
Total assets
Current liabilities Accounts payable Accrued expenses
Total current liabilities
Long-term liabilities Bonds payable
Total long-term liabilities Net assets
Total liabilities and net assets
To prepare for this Assignment:
4,000 5,500
2016
$600
25,000 (18,000) 7,000
18,000 30,500
2,500 850 3,350
5,500 5,500
21,650 $30,500
2017
$400
3,500 800 4,700
23,000 (17,000) 6,000
9,000 20,250
2,000 900 2,900
7,500 7,500
9,850 $20,250

Examine the financial statements from Springfield Community Hospital. Reflect on howyou will use this financial data to calculate and analyze the organization’s financialratios. Refer to Chapter 4 of Financial Management of Health Care Organizations: An Introduction to Fundamental Tools, Concepts and Applications for additional guidance.
Week 8 Assignment 2 Ratio Template
A
B
12/31/20X1
[D/E]
12/31/20X0
[F/G]
(in ‘000)
Ratio
[a]
Current Ratio
Quick Ratio
Acid Test Ratio
Days in Accounts Receivable
Days Cash on Hand
Average Payment Period (Days)
Operating Revenue per Adjusted Discharge
Operating Expense per Adjusted Discharge
Salary & Benefit Exp. as % of Operating Exp.
Operating Margin
Non-Operating Revenue
Return on Total Assets
Return on Net Assets
Total Asset Turnover Ratio
Fixed Asset Turnover Ratio
Age of Plant Ratio
Long-Term Debt to Net Assets
Net Assets to Total Assets
Numerator
D
E
20X1
20X1
Numerator Denominator
F
G
20X0
20X0
Numerator Denominator