Analytical Assignment $1$

Sugar Land Nursing Home has just acquired a home health firm for $$850,000$ in cash. The balance sheet of the home health firm looked as follows just before the acquisition:

Sugar Land Balance Sheet

Current assets

$$200,000$

Net fixed assets

$$100,000$

Total

$$300,000$

Current liabilities

$$100,000$

Shareholder's equity

$$200,000$

Total

$$300,000$

Assume that the fair market value of the net fixed assets is $$300,000$ and fair market value of current assets is $$200,000.$ Describe how this acquisition might be reflected on the balance sheet of Sugar Land Nursing Home.

Analytical Assignment $2$

Below is a list of accounts for Tyler Physical Therapy for December $2021($annual amounts$).$ Prepare an income statement for $2021$ and analyze it using appropriate financial ratios.

Tyler Physical Therapy List of Accounts December $2021($annual amounts$)$

Account

Amount

Administrative expenses

$$80,000$

Net assets released from temporarily restricted accounts for operations

$120,000$

Labor expense

$260,000$

Interest expense

$12,000$

Net patient service revenue

$840,000$

Supply expense

$88,000$

Transfer to parent corporation

$10,000$

Bad debt expense

$40,000$

Depreciation expense

$50,000$