1. Financial Ratio Analysis

Using the data from the attached financial statements for West Texas Regional Hospital (WTRH), calculate the following ratios, then, interpret and briefly explain a trend analysis (compare current to prior year) and a comparative analysis (compare to industry averages) for each ratio. Be sure to show how you obtained your calculations.

RATIOS	WTRH 2016	WTRH 2015	Industry Averages
Total Margin			5.3
Operating Margin			3.6
Return on Assets (ROA)			4.9
Return on Equity (ROE)			8.3
Current Ratio			2.0
Days Cash on Hand			31.5
Debt Ratio			41.8
Times Interest Earned			4.0
Fixed Asset Turnover			2.1
Total Asset Turnover			0.98
Days in Patient A/R			68.0
Average Age of Plant			9.1

2. Operating Indicator Analysis

Using the following data, calculate the following ratios for West Texas Regional Hospital (WTRH), then, interpret and briefly explain a comparative analysis of each ratio.

DATA:

Net inpatient revenue	$43,150,750
Net outpatient revenue	$79,825,000
Net patient service revenue	$122,975,750
Inpatient operating expenses	$37,975,000
Total salaries	$38,250,000
Total discharges	7,250
Inpatient days	41,500
# licensed and staffed beds	250
Average daily census	166
Total FTE's	1,500
Inpatient FTEs	525

RATIOS:

RATIOS	WTRH 2016	Industry Average
Profit per Discharge		$785
Net Price per Discharge		$5,750
Outpatient Revenue %		58.5%
Occupancy Rate		49.2%
Average Length of Stay		4.7
Inpatient FTEs per Occupied Bed		5.6
Salary per FTE		$32,987