Horizontal, vertical, and ratio analyses. Exhibits 4.28a and 4.28b show the statement of operations and balance sheet for the 375-bed Island Regional Medical Center for 20X0 and 20X1.

a. Perform a horizontal analysis on both statements.

b. Perform a vertical analysis on both statements relative to 20X0.

c. Compute all the selected ratios listed in Exhibit 4.16a, and compare them with the benchmarks.

Using these financial performance measures, evaluate the financial state of Island. The debt principal payments each year are $4,500,000, and adjusted discharges are 13,500 for 20X0 and 14,000 for 20X1.

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EXHIBIT 4.28a STATEMENT OF OPERATIONS FOR ISLAND REGIONAL MEDICAL CENTER Island Regional Medical Center Statement of Operations for the Years Ended December 31, 20X1 and 20X0 (In thousands) Revenues Net patient service revenue Other operating revenue Total operating revenues 20X1 20X0 $116,500 $105,600 2,100 2,300 118,600 107,900 Expenses Salaries and benefits 74,800 65,300 Supplies and other expenses 34,500 32,300 Depreciation 5,500 4,500 Interest 1,200 1,300 Total operating expenses 116,000 103,400 Operating income 2,600 4,500 Nonoperating revenue 1,500 2,500 Excess of revenues over expenses 4,100 7,000 Increase (decrease) In net assets $4,100 $7,000