Question

a.	Using the data below as of 12/31/17 and the format found in Exhibit 4.1, create a Balance Sheet for XYZ Hospital for 12/31/17
	Accounts payable	401,760
	Accrued expenses	485,520
	Cash	968,160
	Inventory	295,600
	Long-term debt	6,825,760
	Long-term investments	3,844,720
	Net patient accounts receivable	2,280,720
	Net property and equipment	4,196,000
	Notes payable	346,720
	Other long-term liabilities	420,000
	Short-term investments	800,000

	Based upon your Balance Sheet, answer the following in the space provided:
b.	How much does the hospital own?
c.	What % of the hospital's assets are current?
d.	How much does the hospital owe to others?
e.	What are current assets minus current liabilities?
f.	What is the hospital's net assets (equity)?
g.	If the hospital earned $250,000 in 2017, what was the net assets (equity) balance on 12/31/16?
h.	If the net assets (equity) balance was $375,000 on 12/31/16, what was the hospital's net income in 2017?

Answer 1

a). Preparing balance Sheet for XYZ Hospital for 12/31/17

Particular	Amount
ASSETS
Cash	968160
Inventory	295600
Net patients Accounts Receivables	2280720
Short Term Investments	800000
Total Current Assets	4344480
Long Term Investments	3844720
Net Property & Equipment	4196000
Total Assets	12,385,200
LIABILITIES & EQUITIES
Accounts Payable	401760
Accrued Expenses	485520
Notes Payable	346720
Total Current Liabilities	1234000
Long Term Liabilities	6825760
Other Long term liabilities	420000
Total Equity (balancing figure)	3905440
Total Liabilities & Equities	12,385,200

b). Total Amount the Hospital Own = Total Assets

= 3905,440

So, Hospital own amount is $ 3905,400

c).  % of the hospital's assets that are current = (Total Current Assets / Total Assets)*100

= (4344,480/12385,200)*100

= 35.08%

So, % of hospital's assets that are current is 35.08.

d). Total Amount Hospital owe's to others = Total Current liabilities + Long Term Liabilities + Other Long term liabilities

  = 1234,000 + 6825,760 + 420,000

= $ 8479,760

So, Hospital owe amount is $ 8479,760.

e). Current Assets less Current Liabilitiies = 4344,480 - 1234,000

=$ 3110,480

f). Hospital's net assets (equity) = Total Assets - Total Liabilities

= 12385,200 - (1234,000 + 6825,760 + 420,000)

  = $ 3905,440

g). If the hospital earned $250,000 in 2017, the net assets (equity) balance on 12/31/16 is :

= 3905,440 - 250000

= $ 3655,440

h). If the net assets (equity) balance was $375,000 on 12/31/16, the hospital's net income in 2017 is :

= 3905,440 - 375,000

= $ 3530,440

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