. Consider the following financial statement for BestCare HMO, a non-profit managed care plan:

best care HMO income statement year ended june 30, 2012 (in thousands) revenue Premiums earned $26,682 Coinsurance 1,689 Interest and other income 242 Total Revenue $28,613 Expences Salaries and benefits $15,154 Medical Supplies and drugs 7,507 Insurance 3,963 Provision for bad debts 19 Depreciation 367 Interest 385 Total Expenses $27,395 Net Income $1,218 Net Assets, beginning of year $900

BestCare HMO

Balance Sheet

June 30, 2012

( in thousands)

Assets

Cash and cash equivalents $2,737

Net premiums receivable 821

Supplies 387

Total Current Asset $3,945

Net property and equipment $5,924

Total Assets $9,869

Liabilities and Net Assets

Account payable-medical services $2,145

Accrued expenses 929

Notes payable 141

Current portion of long-term debt 241

Total current liabilities $3,456

Long-term debt $4,295

Total liabilities $7,751

Net assets (equity) $2,118

Total liabilities and net assets $9,869

Calculate and interpret the following ratios for Bestcare ( 15 points)

	Industry Average
Total margin	3.8%
Total Asset turnover	2.1
Return on equity	25.5%
Return on assets	8.0%
Current ratio	1.3
Days cash on hand	41 days
Average collection period	7days
Debt ratio	69%
Times interest earned ratio	2.8
Fixed asset turnover ratio	5.2