Mathematical Formula for Amortization - Excel - Excel

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```					N287E                                                                                                    Ratios for Financial Analysis                                                                             Description of ratios

Formulae ignoring depreciation               Formulae with depreciation
Ratio                          What it tells us                      Formula                                                           This year   Last year   Favorable?   Trend?   Benchmark    This year       Favorable?
How able is the firm to meet its
a   Current ratio                  liabilities                          = total current assets/total current liabilities                       1.875       0.782      no        good       1.88
= (accounts receivable - uncollectible receivables + receivable
Days in patient accounts       Number of days to collect receivable from 3rd party payers - payable to 3rd party payers)/(net
b   receivable                     income                               patient revenue/days in a year)                                       92.679     115.503      no        good       74.3
Length of time it takes to pay its    =current liabilities/((total operating expense -
c   Average payment period         bills                                 depreciation)/days)                                                  51.319     147.336                good                      54.357
How much cash is available -          =(cash+marketable securities)/((total operating expense -
d   Days’ cash on hand             measures safety                       depreciation)/days)                                                   7.695      21.702      bad        bad       99.6            8.150           no
Percent of assets that are financed
e   Equity financing ratio         with things other than debt           =total equity/total assets                                            0.357       0.210      bad       good       52%

Can indicate age of plant, because
f   Long-term debt to equity ratio debt often finances construction      =net long term debt/total equity                                      1.361       1.910      bad       good       0.312
Source of funds/need for future
funds. Predicts financial failure     =(net income + depreciation)/(current liabilities+net long term
g   Cash flow to debt ratio        well.                                 debt)                                                                -0.099      -0.125      no        good       0.155          -0.010           no
Efficiency of use of investment -     =(total operating revenue+total nonoperating revenue)/total
h   Total asset turnover ratio     high is good.                         assets                                                                0.946       0.831      bad       good       0.85
Assesses the efficiency of the largest =(total operating revenue+total nonoperating
I   Fixed asset turnover ratio     asset in hospitals                     revenue)/property, plant, and equipment (PPE)                        2.257       1.880     good       good       2.21
Efficiency of investment in current   =(total operating revenue+total nonoperating revenue)/total
j   Current asset turnover ratio   assets in generation of revenue.      current assets                                                        3.593       2.867     good       good       2.84
Ability to provide services with      =(total operating revenue+total nonoperating revenue)/(total
k   Other asset turnover ratio     minimal investment                    assets - total current assets - PPE)                                  2.976       3.102                 bad
=net income/(total operating revenue+total nooperating
l   Total margin ratio             Profitability                         revenue)                                                             -0.066      -0.116      no        good       0.32
Profitability from operations (not    =net operating income/(total operating rev+total nooperating
m Operating margin ratio           non-operating revenue & expense)      rev)                                                                 -0.081      -0.161                good
Profitability from nonoperating
categories, which can buffer          =net nonoperating gain/(total operating rev+total nooperating
n   Nonoperating gain ratio        operating net                         rev)                                                                  0.015       0.045                 bad

Amount of net income earned per
o   Return on equity ratio         dollar of equity investment           =net income/total equity                                             -0.174      -0.460                good
This will differ from ROE if firms
has equity source other than net
p   Growth rate in equity          income (endowment, etc.)              =change in equity/equity                                              0.463
Question 5
Using the Summit Medical Center balance sheets, compute the following:
a.     Return on capital employed
There are several ways you can compute this - I'm giving you the way I used.
Original formula       My approximation                                       Original formula      My approximation
overhead               No approx needed - you can go                          accounts receivable   go straight to the sum
+ materials            straight to the next sum!                              + inventory           go straight to the sum
=cost of goods sold Total operating expense                \$220,910,883       - accounts payable    go straight to the sum
+other expenses        Total nonoperating expense             \$2,112,510      =working capital      current assets - current liabilities    \$27,180,834
=total expenses                                            \$223,023,393       + fixed assets        property, plant, and equipment          \$92,692,682
=capital employed                                            \$119,873,516
revenue                operating rev + nonop revenue** \$209,252,992
- total expenses                                           \$223,023,393
=net income                                                 (\$13,770,401)

return on capital employed
=net income/capital employed                                     -0.1149

** you can use the sum of operating rev and nonop rev or only operating rev for these
b.    Return on investment
Original formula      My approximation                                    Original formula        My approximation
labor                 go straight to the sum                              inventories             go straight to the sum
+ materials           go straight to the sum                              + accounts receiv.      go straight to the sum
+ overhead            go straight to the sum                              + cash                  go straight to the sum
= cost of goods sold Total operating expenses             \$220,910,883    = current assets                                          \$58,241,197
+ fixed assets          property, plant, and equipment    \$92,692,682
sales                 operating revenue**                 \$203,941,744    = total assets                                           \$150,933,879
- (cost of goods sold                                     \$220,910,883
+ other costs)        Total nonoperating expense            \$2,112,510    sales/                                                   \$203,941,744
= net income/                                             (\$19,081,649)   total assets                                             \$150,933,879
sales                                                     \$203,941,744    = asset turnover rate                                             1.35
= profit margin                                                 -9.36%

profit margin/                                  -9.36%
asset turnover rate                                1.35
= return on investment                          -6.92%
Question 6
In the “current year”, Summit Medical Center had a negative net income (i.e., they lost money).
Discuss strategies they could use to reach a profit margin of 1%. Use mathematical examples to
demonstrate how some strategies might be more or less feasible.

The strategies discussed include:
* reducing material prices
* increasing sales
One also can consider:
* reducing labor costs
* reducing overhead costs

There is a lot of room to make assumptions when answering this question. Thus, please consider
my notes a single example and not the "only" way to answer the question!
To limit the scope of my answer, I'm going to look only at operating revenues and expenses

Actual balance sheet                       dollar value   share of sales
Sales                                    \$203,941,744                Total operating revenue
Costs                                    \$220,910,883    108.3%      Total operating expenses

Sales - costs = net income               (\$16,969,139)      -8.3%      This is not good!

To get to a 1% positive margin, I'm going to tweak the numbers in the balance sheet…
We need to make an assumption about fixed costs vs. variable costs. For an example, I'm going
to assume that fixed costs are about 20% of the total costs.

Assumption:
Sales                                    \$203,941,744
Costs - assumed fixed                     \$44,182,177       21.7%
Costs - assumed variable                 \$176,728,706       86.7%       As sales increase, variable
costs must increase!!!
Sales - costs = net income               (\$16,969,139)      -8.3%

Case 1: reducing variable costs            dollar value    share of sales
Sales                                   \$203,941,744
Costs - assumed fixed                     \$44,182,177     21.7%
Costs - assumed variable                \$157,700,000     77.3%       I played with the variable costs
until I got the 1% net income
Sales - costs = net income                 \$2,059,567      1.0%

I would have to reduce variable costs from \$176,728,706 to \$157,700,000 to get a 1% net income.
This requires an 11% cut in costs, through reductions in labor, supplies, and other variable items.
Case 2: increasing sales                 dollar value     share of sales
Sales                                  \$360,000,000                 I adjusted sales until my
Costs - assumed fixed                    \$44,182,177     12.3%      bottom line was one percent.
Costs - assumed variable               \$312,120,000     86.7%       Note that variable costs
rise to stay at 86.7% of sales.
Sales - costs = net income               \$3,697,823       1.0%

I would have to raise sales from \$203,941,744 to \$360,000,000 to obtain the 1% profit!
Perhaps now you understand why nursing gets hit whenever a hospital needs to improve its
operating margin…
Question 7

Machine A   Machine B
Price of machine                  \$900,000    \$1,350,000
Delivery and training cost         \$30,000      \$55,000
Straight-line depreciation life    5 years      5 years
Cash flow                         \$160,000     \$235,000

a. What is the initial cost of each
Initial cost =                   \$930,000     \$1,405,000
Price of machine +               \$900,000     \$1,350,000
Delivery and training cost        \$30,000       \$55,000

b. Calculate the Net Present Value for each machine at a 10% discount rate, over 10 years.
c. Calculate the Net Present Value for each machine at a 12% discount rate, over 10 years.
NPV machine A                    income        PVIF 10%      PV 10% PVIF 12%             PV 12%
Year 1                          \$160,000         0.9091     \$145,456     0.8929         \$142,864
Year 2                          \$160,000         0.8264     \$132,224     0.7972         \$127,552
Year 3                          \$160,000         0.7513     \$120,208     0.7118         \$113,888
Year 4                          \$160,000          0.683     \$109,280     0.6355         \$101,680
Year 5                          \$160,000         0.6209      \$99,344     0.5674          \$90,784
Year 6                          \$160,000         0.5645      \$90,320     0.5066          \$81,056
Year 7                          \$160,000         0.5132      \$82,112     0.4523          \$72,368
Year 8                          \$160,000         0.4665      \$74,640     0.4039          \$64,624
Year 9                          \$160,000         0.4241      \$67,856     0.3606          \$57,696
Year 10                         \$160,000         0.3855      \$61,680      0.322          \$51,520
\$983,120                    \$904,032
-investment   \$930,000                   \$930,000
NPV        \$53,120                    -\$25,968

NPV machine B                      income     PVIF 10%          PV     PVIF 12%           PV
Year 1                            \$235,000     0.9091        \$213,639   0.8929         \$209,832
Year 2                            \$235,000     0.8264        \$194,204   0.7972         \$187,342
Year 3                            \$235,000     0.7513        \$176,556   0.7118         \$167,273
Year 4                            \$235,000      0.683        \$160,505   0.6355         \$149,343
Year 5                            \$235,000     0.6209        \$145,912   0.5674         \$133,339
Year 6                            \$235,000     0.5645        \$132,658   0.5066         \$119,051
Year 7                            \$235,000     0.5132        \$120,602   0.4523         \$106,291
Year 8                            \$235,000     0.4665        \$109,628   0.4039          \$94,917
Year 9                            \$235,000     0.4241         \$99,664   0.3606          \$84,741
Year 10                           \$235,000     0.3855         \$90,593    0.322          \$75,670
\$1,443,958                \$1,327,797
-investment   \$1,405,000                \$1,405,000
NPV         \$38,958                  -\$77,203

Initial investment                \$930,000    \$1,405,000
Profitability index value:          1.057        1.028
e. You decide to purchase Machine A, and after 3 years you want to replace it with Machine B.
What are the incremental cash flows associated with the purchase of the new machine?

EBIT: Estimated earnings before interest and taxes
EBIT Values
Year                Machine B         Machine A       Additional
1                  \$235,000         \$160,000        \$75,000
2                  \$235,000         \$160,000        \$75,000
3                  \$235,000         \$160,000        \$75,000
4                  \$235,000         \$160,000        \$75,000
5                  \$235,000         \$160,000        \$75,000

Additional tax benefit
Additional Additional
Year               B depreciation   A depreciation depreciation tax benefit
1                   \$270,000         \$180,000       \$90,000     \$30,600
2                   \$270,000         \$180,000       \$90,000     \$30,600
3                   \$270,000         \$180,000       \$90,000     \$30,600
4                   \$270,000                       \$270,000     \$91,800
5                   \$270,000                       \$270,000     \$91,800

Machine A is sold for \$400,000. It has depreciated for 3 years at \$180,000 per year.
The current book value is thus \$360,000. The proceeds from the sale are thus \$40,000.
Capital gains taxes on the sale are 34% of \$40,000 (\$13,600).
However, this additional expense (part of intial expenses) are NOT part of the incremental cash flows!
Also note that the installation/training cost is not depreciated and thus not part of the cash flows.

incremental cash flows = Incremental EBIT + Incremental tax benefit of depreciation
Incremental      Incremental Incremental
Year                   EBIT          tax benefit  cash flows
1                   \$75,000          \$30,600      \$105,600
2                   \$75,000          \$30,600      \$105,600
3                   \$75,000          \$30,600      \$105,600
4                   \$75,000          \$91,800      \$166,800
5                   \$75,000          \$91,800      \$166,800
5.                                 BALANCE SHEET - UNRESTRICTED FUND
Hospital DBA Name _______SUMMIT MEDICAL CENTER_________________                                            Report Period End _____12/31/00______

Line                                                                                       Account           (1)                   (2)          Line
No.                                             ASSETS                                       No.         Current Year          Prior Year       No.
CURRENT ASSETS
5     Cash                                                                              1000               4657189             11054431     5
10     Marketable securities                                                             1010                                               10
15     Accounts and notes receivable                                                     1020             127134819             97682182    15
20     Less allowance for uncollectible receivables and third-party contractual withholds1040             -79253444            -62170735    20
25     Receivables from third-party payors                                               1050                                    4570912    25
30     Pledges and other receivables                                                     1060               1094767              2554519    30
35     Due from restricted funds                                                         1070                                               35
40     Inventory                                                                         1080               2053339              1868079    40
45     Intercompany receivables                                                          1090               1554994              1818592    45
50     Prepaid expenses and other current assets                                         1100                999533              1298888    50
55         TOTAL CURRENT ASSETS (Sum of lines 5 through 50)                                                58241197             58676868    55

ASSETS WHOSE USE IS LIMITED
60      Board designated cash                                                           1110                                                60
65      Board designated investments                                                    1120               48037344             23041722    65
70      Board designated other assets                                                   1130                                                70
75         TOTAL ASSETS WHOSE USE IS LIMITED (Sum of lines 60 through 70)                                  48037344             23041722    75

PROPERTY, PLANT AND EQUIPMENT - AT COST
80        Land                                                            1200                                 4141545              4141545    80
85        Land improvements                                               1210                                 1552072              1537932    85
90        Buildings and improvements                                      1220                               235604376            233556402    90
95        Leasehold improvements                                          1230                                  168462               168462    95
100        Equipment                                                       1240                                75614199             62112768   100
105           TOTAL PROPERTY, PLANT AND EQUIPMENT (Sum of lines 80 through 100)                               317080654            301517109   105
195        Less accumulated depreciation and amortization                  1260                              -224387972           -212044680   195
200           NET TOTAL PROPERTY, PLANT AND EQUIPMENT (Sum of lines 105 & 195)                                 92692682             89472429   200
205        Construction in progress                                        1250                                16027555             25664723   205

INVESTMENTS AND OTHER ASSETS
210         Investments in property, plant and equipment                       1310                 .                     .                    210
215         Less accumulated depreciation - investments in plant and equipment 1320                 .                     .                    215
220         Other investments                                                  1330                 .                     .                    220
225         Intercompany receivables                                           1340                 .                     .                    225
230         Other assets                                                       1350                             6258429              5539429   230
235             TOTAL INVESTMENTS AND OTHER ASSETS (Sum of lines 210 through 230)                               6258429              5539429   235

INTANGIBLE ASSETS
245         Goodwill                                                                        1360    .                     .                    245
250         Unamortized loan costs                                                          1370    .                     .                    250
255         Preopening and other organization costs                                         1380    .                     .                    255
260         Other intangible assets                                                         1390    .                     .                    260
265            TOTAL INTANGIBLE ASSETS (Sum of lines 245 through 260)                               .                     .                    265

270                  TOTAL ASSETS (Sum of lines 55, 75, 200, 205, 235, and 265)                               221257207            202395171   270

Line                                                                                                         (1)                   (2)          Line
No.                                     OTHER INFORMATION                                                Current Year          Prior Year       No.
405          Current market value - current assets marketable securities (Line 10)                   .                     .                    405
410          Current market value - board designated investments (Line 65)                                      48037344            23041722 410
415          Current market value - other investments (Line 220)                                     .                     .                    415
420          Total cost to complete construction in progress (Line 205)                                          4006888             6416180 420
CHC 7041 a-1 (6-2000)

5(1)
5.                                BALANCE SHEET - UNRESTRICTED FUND

Hospital DBA Name _______SUMMIT MEDICAL CENTER_________________                                  Report Period End _____12/31/00______

Line                                                                            Account           (3)                    (4)          Line
No.                                 LIABILITIES AND EQUITY                        No.         Current Year           Prior Year       No.
CURRENT LIABILITIES
5     Notes and loans payable                                               2010 .                         .                       5
10     Accounts payable                                                      2020                 7306988              40751392    10
15     Accrued compensation and related liabilities                          2030                16485492              15835010    15
20     Other accrued expenses                                                2040                 2624823               5127086    20
25     Advances from third-party payors                                      2050                                                  25
30     Payable to third-party payors                                         2060                                       6008523    30
35     Due to restricted funds                                               2070                                                  35
40     Income taxes payable                                                  2080                                                  40
45     Intercompany payables                                                 2090                                       3022009    45
50     Current maturities of long-term debt (Must agree with line 125)                            4451348               4305659    50
55     Other current liabilities                                             2100                  191712                          55
60         TOTAL CURRENT LIABILITIES (Sum of lines 5 through 55)                                 31060363              75049679    60

DEFERRED CREDITS
65     Deferred income taxes                                                 2110 .                         .                      65
70     Deferred third-party income                                           2120                 3556801               3053663    70
75     Other deferred credits                                                2130 .                                      684007    75
80        TOTAL DEFERRED CREDITS (Sum of lines 65 through 75)                                     3556801               3737670    80

LONG-TERM DEBT Unpaid Principal (a)
85        Mortgages payable                                                     2210     .                     .                      85
90        Construction loans                                                    2220     .                     .                      90
95        Notes under revolving credit                                          2230                12887615              12887615    95
100        Capital lease obligations                                             2240                 1850791               2811828   100
105        Bonds payable                                                         2250                97292675              69740573   105
110        Intercompany payables                                                 2260     .                     .                     110
115        Other non-current liabilities                                         2270     .                     .                     115
120            TOTAL LONG-TERM DEBT (Sum of lines 85 through 115)                                   112031081              85440016   120
125        Less amount shown as current maturities (Must agree with line 50)                         -4451348              -4305659   125
130            NET TOTAL LONG-TERM DEBT (Sum of lines 120 and 125)                                  107579733              81134357   130
135              TOTAL LIABILITIES (Sum of lines 60, 80, and 130)                                   142196897             159921706   135

EQUITY (Non-Profit)
140        Unrestricted Fund Balance                                             2310                79060310              42473465   140

EQUITY (Investor-Owned - Corporation)
145        Preferred stock                                                       2310 \$                         \$                     145
150        Common stock                                                          2320                                                 150
155        Additional paid-in-capital                                            2330                                                 155
160        Retained earnings                                                     2340                                                 160
165        Less Treasury stock                                                   2350 (                         ()                    1
) 65

EQUITY (Investor-Owned - Partnership)
170        Capital - unrestricted                                                2310 \$                         \$                     170
175        Less Partners' draw                                                   2320 (                         ()                    1
) 75

EQUITY (Investor-Owned - Division of a Corporation)
180        Preferred stock                                                       2710 \$                         \$                     180
185        Common Stock                                                          2720                                                 185
190        Additional paid-in-capital                                            2730                                                 190
195        Division equity - unrestricted                                        2740                                                 195
200        Less Treasury stock                                                   2750 (                         ()                    2
) 00

205             TOTAL EQUITY (Sum of lines 140 through 200)                                          79060310              42473465   205

270                  TOTAL LIABILITIES AND EQUITY (Sum of lines 135 and 205)                        221257207             202395171   270

CHC 7041 a-1 (6-2000)
(a) Complete Report Page 5.1 to provide detailed long-term debt information.

5 (2)
8.                  STATEMENT OF INCOME - UNRESTRICTED FUND
Hospital DBA Name _____SUMMIT MEDICAL CENTER_______________                       Report Period End _____12/31/00______

Line                                                                              (1)                    (2)           Line
No. SECTION I                                                                 Current Year           Prior Year        No.

OPERATING REVENUES:
5      Daily hospital services                                                     131765765             112846115    5
10      Ambulatory Services                                                          22437073              20294435   10
15      Ancillary Services                                                          334248202             277079008   15
30        GROSS PATIENT REVENUE (Sum of lines 5 through 15)                         488451040             410219558   30

105 DEDUCTIONS FROM REVENUE: (From Line 395 )                                        299878505             264568426 105
107 CAPITATION PREMIUM REVENUE: (From Line 450)                           .                      .                   107
110   NET PATIENT REVENUE (Line 30 minus line 105 plus line 107)                     188572535             145651132 110
135 TOTAL OTHER OPERATING REVENUE:                                                    15369209              13251424 135
140   TOTAL OPERATING REVENUE (Sum of lines 110 and 135)                             203941744             158902556 140

OPERATING EXPENSES:
146      Daily Hospital Services                                                      48964222              39073070 146
151      Ambulatory Services                                                          13974139              12068263 151
156      Ancillary Services                                                           67659811              55979752 156
161      Research Costs                                                   .                      .                   161
166      Education Costs                                                              13430339              10961286 166
171      General Services                                                             36283070              31218857 171
176      Fiscal Services                                                               5852081               4940671 176
181      Administrative Services                                                      21258992              21818491 181
186      Unassigned Costs                                                             13488229               9863040 186
190      Purchased Inpatient Services                                     .                      .                   190
195      Purchased Outpatient Services                                    .                      .                   195
200         TOTAL OPERATING EXPENSES (Sum of lines 146 through 195)                  220910883             185923430 200
205            NET FROM OPERATIONS (Line 140 minus line 200)                         -16969139             -27020874 205

210 NET NON-OPERATING REVENUE AND EXPENSE: (From Line 700) (c)                         3198738               7500830 210

NET INCOME BEFORE TAXES AND EXTRAORDINARY ITEMS: (Sum of lines
215     205 and 210)                                                                 -13770401             -19520044 215

PROVISION FOR INCOME TAXES:
220      Current                                                                                                       220
225      Deferred                                                                                                      225

230 NET INCOME BEFORE EXTRAORDINARY ITEMS: (Line 215 minus 220 and 225)              -13770401             -19520044 230

EXTRAORDINARY ITEMS: (Specify)
235                                                                                                                    235
240                                                                                                                    240

245           NET INCOME (Line 230 minus lines 235 and 240)                          -13770401             -19520044 245

CHC 7041 d-1 (6-2000)

8 (1)
8.         STATEMENT OF INCOME - UNRESTRICTED FUND
(DEDUCTIONS FROM REVENUE AND CAPITATION PREMIUM REVENUE)                                                                                           (NON
Hospital DBA Name _____SUMMIT MEDICAL CENTER_______________                                              Report Period End _____12/31/00______

Line                                                                                                       (1)                       (2)         Line
No. SECTION II                                                                                         Current Year              Prior Year      No.

DEDUCTIONS FROM REVENUE:
300     Provision for bad debts                                                                                 4088783                 6489374 300
305     Contractual adjustments - Medicare - traditional                                                      102066198                88223880 305
310     Contractual adjustments - Medicare - managed care                                                      35013970 .                       310
315     Contractual adjustments - Medi-Cal - traditional                                                       53908946                44964338 315
320     Contractual adjustments - Medi-Cal - managed care                                                      22166255 .                       320
325     Disproportionate share payments for Medi-Cal patient days (SB 855) (credit bal.) (a)     .                      .                       325
330     Contractual adjustments - County indigent programs - traditional                         .                      .                       330
335     Contractual adjustments - County indigent programs - managed care                        .                      .                       335
340     Contractual adjustments - Other third parties - traditional                                            11213618                 5909922 340
345     Contractual adjustments - Other third parties - managed care                                           68971872               117110227 345
350     Charity discounts - Hill Burton                                                          .                      .                       350
355     Charity discounts - other                                                                               2448863                 1870685 355
360     Restricted donations and subsidies for indigent care (credit balance)                    .                      .                       360
365     Teaching allowances (Teaching Hospitals only)                                            .                      .                       365
370     Support for clinical teaching (credit balance) (Teaching Hospitals only)                 .                      .                       370
375     Policy discounts                                                                         .                      .                       375
380     Administrative adjustments                                                               .                      .                       380
385     Other deductions from revenue                                                            .                      .                       385
395       TOTAL DEDUCTIONS FROM REVENUE (Sum of lines 300 thru 385)                                           299878505               264568426 395

CAPITATION PREMIUM REVENUE:
430     Capitation Premium Revenue - Medicare (credit balance)                                   .                         .                      430
435     Capitation Premium Revenue - Medi-Cal (credit balance)                                   .                         .                      435
440     Capitation Premium Revenue - County indigent programs (credit balance)                   .                         .                      440
445     Capitation Premium Revenue - Other third parties (credit balance)                        .                         .                      445
450        TOTAL CAPITATION PREMIUM REVENUE (Sum of lines 430 thru 445)                                                                           450

CHC 7041 d-3 (6-2000)

(a) Disproportionate share funds transferred back to a related public entity must be reported on page 7, column (1), line 105.

CHC 7041 d-1 (6-2000)

8 (2)
8                          STATEMENT OF INCOME - UNRESTRICTED FUND
PREMIUM REVENUE)                          (NON-OPERATING REVENUE AND EXPENSE)
Hospital DBA Name _____SUMMIT MEDICAL CENTER_______________                          Report Period End _____12/31/00______
Report Period End ________________________

Line                                                                 Account              (1)                  (2)          Line
No. SECTION III                                                        No.            Current Year         Prior Year       No.

NON-OPERATING REVENUES:
500     Gains on sale of hospital property                            9010                     4,619                 3,065 500
505     Maintenance of restricted funds revenue                       9030     .                       .                   505
510     Unrestricted contributions                                    9040     .                       .                   510
515     Donated services                                              9050     .                       .                   515
520     Income, gains and losses from unrestricted investments        9060              1,991,054            5,872,458 520
525     Unrestricted income from endowment funds                      9070     .                       .                   525
530     Unrestricted income from other restricted funds               9080     .                       .                   530
535     Term endowment funds becoming unrestricted                    9090     .                       .                   535
540     Transfers from restricted funds for non-operating expenses    9100     .                       .                   540
545     Assessment revenue (b)                                        9150     .                       .                   545
550     County allocation of taxes revenue (b)                        9160     .                       .                   550
555     Special district augmentation revenue (b)                     9170     .                       .                   555
560     Debt service taxes revenue (b)                                9180     .                       .                   560
565     State homeowner's property tax relief (b)                     9190     .                       .                   565
570     State appropriation                                           9200     .                       .                   570
575     County appropriation - Realignment funds                      9210     .                       .                   575
580     County appropriation - County general funds                   9220     .                       .                   580
585     County appropriation - Other county funds                     9230     .                       .                   585
590     Physicians' offices and other rentals - revenue               9250     .                       .                   590
595     Medical office building revenue                               9260              3,315,575            2,258,817 595
600     Child care services revenue (non-employees)                   9270     .                       .                   600
605     Family housing revenue                                        9280     .                       .                   605
610     Retail operations revenue                                     9290     .                       .                   610
615     Other non-operating revenue                                   9400     .                             1,210,066 615
625        TOTAL NON-OPERATING REVENUE (Sum of lines 500 thru 615)                         5,311,248             9,344,406 625

NON-OPERATING EXPENSES:
640     Losses on sale of hospital property                           9020     .                       .                    640
645     Maintenance of restricted funds expense                       9030     .                       .                    645
650     Physicians' offices and other rentals expense                 9510     .                       .                    650
655     Medical office building expense                               9520                 2,097,800            1,567,409 655
660     Child care services expense (non-employees)                   9530     .                       .                    660
665     Family housing expense                                        9540     .                       .                    665
670     Retail operations expense                                     9550     .                       .                    670
675     Other non-operating expense                                   9800                    14,710              276,167 675
685       TOTAL NON-OPERATING EXPENSE (Sum of lines 640 thru 675)                          2,112,510              1,843,576 685

NET NON-OPERATING REVENUE AND EXPENSE (Line 625
700              minus line 685)                                                           3,198,738            7,500,830   700

705 Interest on long-term debt (b)                                             \$                       \$                    705

CHC 7041 d-2 (6-2000)
(b) District hospitals only.

8 (3)

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Description: Mathematical Formula for Amortization document sample