Ratio analysis, unknown bed size. Compare Spring Hill Community Hospital’s liquidity;

revenue, expense, and profitability; activity; and capital structure ratios with its national industry benchmarks, using the data from Exhibits 4.16a and 4.23.

Transcribed Image Text:

EXHIBIT 4.23 SELECTED FINANCIAL RATIOS FOR SPRING HILL COMMUNITY HOSPITAL Ratio Liquidity ratios Current ratio Quick ratio Acid test ratio Days in accounts receivable Days cash on hand 20X1 20X0 1.78 2.15 1.29 1.55 0.18 0.35 82 60 60 100 40 50 Average payment period (days) Revenue, expense, and profitability ratios Operating revenue per adjusted discharge $7,900 $7,800 Operating expense per adjusted discharge $8,200 $7,400 Salary and benefit expense as a percentage of total operating 55% 45% expense Operating margin (0.04) 0.05 Nonoperating revenue 0.06 0.01 Return on total assets 0.02 0.03 Return on net assets 0.08 0.05 Activity ratios Total asset turnover ratio 1.07 0.84 Fixed asset turnover ratio 2.70 1.46 Age of plant 9.26 11.08 Capital structure ratios Long-term debt to net assets 0.65 0.25 Net assets to total assets 0.35 0.52 Times interest earned 2.00 3.20 Debt service coverage ratio 2.50 3.70