Question

Miami Children's Hospital reported net income for 2018 0f $9,700,120 on total revenues of $121,251,500. Depreciation...

Miami Children's Hospital reported net income for 2018 0f $9,700,120 on total revenues of $121,251,500. Depreciation expense totaled $4,041,717. Assume that all expenses, except depreciation, were cash expenses.

a. Assume the hospital is a not-for-profit corporation for parts a - c. What were total operating expenses for 2018?

b. What were total cash expenses for 2018?

c. What was the hospital’s 2018 cash flow?

d. Now, suppose the company changed its depreciation method (still within GAAP) such that its depreciation expense double. How would this change affect cash flow? Please show your work.

e. Assume the hospital is a for-profit corporation who reported a pretax (operating) income of $9,700,120 on total revenue of $121,251,500 and that depreciation totaled $4,041,717, and that all expenses, except depreciation, were cash expenses. What was the hospital’s 2018 cash flow if the tax rate is 20% of pretax income?

f. Assume the hospital is a for-profit corporation as in Part e above. Suppose the company changed its depreciation method (still within GAAP) such that its depreciation expense double. How would this change affect cash flow? Please show your work.

0 0
Add a comment Improve this question Transcribed image text
Answer #1

A. Total operating expenses = Revenue - net income = 121,251,500-9,700,120 = 111,551,380

B. Total Cash expenses = operating expenses - depreciation = 111,551,380 - 4,041,717 = 107,509,663

C. Cash flow from operating = net income + non cash expenses + changes in working capital

CF = 9,700,120 + 4,041,717 = 13,741,837

D. New depreciation = 8,083,434

CF = 9700120+8083434= 17,783,554

E. Net income = 9700120*(1-0.2) = 7,760,096

Cash flow = 7760096+4041717=11,801,813

F. New depreciation = 8083434

CF = 7760096+8083434= 15,843,530

Add a comment
Know the answer?
Add Answer to:
Miami Children's Hospital reported net income for 2018 0f $9,700,120 on total revenues of $121,251,500. Depreciation...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Henson Pharmaceuticals reported net income for 2018 of $4.8 million on total revenues of $44 million....

    Henson Pharmaceuticals reported net income for 2018 of $4.8 million on total revenues of $44 million. Depreciation expense totaled $930,000.   What were total cash expenses for 2018? Assume that depreciation is a non-cash expense.

  • Show all work please. Not through Excel. 11.4 Great Forks Hospital reported net income for 2016...

    Show all work please. Not through Excel. 11.4 Great Forks Hospital reported net income for 2016 of $2.4 million on total revenues of $30 million. Depreciation expense totaled $1 million. a. What were total expenses for 2016? b. What were total cash expenses for 2016? (Hint: Assume that all expenses, except depreciation, were cash expenses.) c. What was the hospital's 2016 estimated cash flow?

  • XYZ Company, a 'for-profit' business, had revenues of $15 million in 2018. Expenses other than depreciation...

    XYZ Company, a 'for-profit' business, had revenues of $15 million in 2018. Expenses other than depreciation totaled 75 percent of revenues. XYZ Company, must pay taxes at a rate of 40 percent of pretax (operating) income. All revenues were collected in cash during the year, and all expenses other than depreciation were paid in cash.   Depreciation originally was $1.3 million; however, a change in the depreciation schedule (still within GAAP) has now made the depreciation expense DOUBLE.   Based on this...

  • Brookline Specialty Hospital, a not-for-profit provider, had revenues of $12 million in 2018. Expenses other than...

    Brookline Specialty Hospital, a not-for-profit provider, had revenues of $12 million in 2018. Expenses other than depreciation totaled 75% of revenues. Brookline purchased fixed assets for $50 million in 2010 and expects to sell these assets for $20 million at the end of their 20-year lifetime. a. Calculate Brookline’s annual depreciation expense. b. Construct Brookline’s income statement for Year Ended December 31, 2018. c. Calculate Brookline’s net income, total profit margin, and approximate cash flow. In one sentence, provide an...

  • show all work. not through excel please 11.5 Brandywine Clinic, a not-for-profit business, had revenues of...

    show all work. not through excel please 11.5 Brandywine Clinic, a not-for-profit business, had revenues of $12 million in 2016. 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. Construct Brandywine's 2016 income statement. b. What were Brandywine's net income, total profit margin, and cash flow? a. Now, suppose the company changed its depreciation calculation...

  • Henson Pharmaceuticals reported net income for 2018 of $4.8 million on total revenues of $44 million....

    Henson Pharmaceuticals reported net income for 2018 of $4.8 million on total revenues of $44 million. Depreciation expense totaled $930,000. What were total expenses for 2018?

  • XYZ Company, a 'for-profit' business, had revenues of $15 million in 2018. Expenses other than depreciation...

    XYZ Company, a 'for-profit' business, had revenues of $15 million in 2018. Expenses other than depreciation totaled 75 percent of revenues. XYZ Company, must pay taxes at a rate of 40 percent of pretax (operating) income. All revenues were collected in cash during the year, and all expenses other than depreciation were paid in cash.   Depreciation originally was $1.5 million; however, now the company has decided to be more conservative in its depreciation of its capital assets. XYZ now has...

  • XYZ Company, a 'for-profit' business, had revenues of $15 million in 2018. Expenses other than depreciation...

    XYZ Company, a 'for-profit' business, had revenues of $15 million in 2018. Expenses other than depreciation totaled 75 percent of revenues. XYZ Company, must pay taxes at a rate of 40 percent of pretax (operating) income. All revenues were collected in cash during the year, and all expenses other than depreciation were paid in cash.   Depreciation originally was $1.5 million; however, now the company has decided to be more conservative in its depreciation of its capital assets. XYZ now has...

  • XYZ Company, a 'for-profit' business, had revenues of $12 million in 2016. Expenses other than depreciation...

    XYZ Company, a 'for-profit' business, had revenues of $12 million in 2016. Expenses other than depreciation totaled 75 percent of revenues. XYZ Company, must pay taxes at a rate of 40 percent of pretax (operating) income. All revenues were collected in cash during the year, and all expenses other than depreciation were paid in cash. Depreciation originally was $1.5 million; however, now the company has decided to be more conservative in its depreciation of its capital assets. XYZ now has...

  • Question text XYZ Company, a 'for-profit' business, had revenues of $15 million in 2018. Expenses other...

    Question text XYZ Company, a 'for-profit' business, had revenues of $15 million in 2018. Expenses other than depreciation totaled 75 percent of revenues, and depreciation expense was $1.3 million. XYZ Company, must pay taxes at a rate of 40 percent of pretax (operating) income. All revenues were collected in cash during the year, and all expenses other than depreciation were paid in cash.   What was XYZ's total cash flow? Hint: Look at the PowerPoint, Homework Hint, especially as it relates...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT