Developing Financial Statements:

All organizations, including those in the healthcare industry, need to make money to be
profitable and survive. Financial statements, such as balance sheets, profit and loss
statements, and cash flow statements, summarize an organization’s profitability and
overall financial status. For this Assignment, you practice developing three key financial
statements using data from the Johnson Hospital

Johnson Hospital is a large Midwestern acute care and ambulatory facility serving
an urban city population.

Givens (in '000s):
Inventory $7,000
Patient revenues (net of contractual allowance) $220,000
Gross plant, property, and equipment $161,900
Net accounts receivable $65,000
Ending balance, temporarily restricted net assets $9,300
Wages payable $18,000
Long-term debt $104,000
Supply expense $18,000
Net assets released from temporary restriction $3,500
Depreciation expense $20,000
General expense $40,000
Provision for bad debt expense $12,000
Cash and cash equivalents $7,500
Transfer to parent corporation ($3,300)
Beginning balance, unrestricted net assets $70,000
Accounts payable $12,000
Beginning balance, temporarily restricted net assets $12,800
Interest expense $6,500
Labor expense $77,600
Accumulated depreciation $90,000
Long-term investments $108,000
Ending balance, unrestricted net assets $116,100

Examine the data from Johnson Hospital. Reflect on how you will use this data to
develop a Balance Sheet, Profit and Loss Statement, and Cash Flow Statement.

Complete a Balance Sheet, Profit and Loss Statement (Statement of Operations), and
Cash Flow Statement (Statement of Changes in Net Assets)

Answer Sheets:

Balance Sheet

Johnson Hospital
Balance Sheet (in '000s)
For the Year Ended September 30, 2016

Current assets
Cash and cash equivalents ______
Net accounts receivable ______
Inventory _____
Total current assets: ______

Gross plant, property, and equipment _______
(less accumulated depreciation) ________
Net plant, property & equipment _______
Long-term investments ________
Total assets: _________

Current liabilities
Accounts payable _____
Wages payable ______
Total current liabilities _______

Long-term debt _____
Total liabilities ______

Net assets
Ending balance, unrestricted net assets ______
Ending balance, temporarily restricted net assets _______
Total net assets ______

Total liabilities and net assets: ________

Statement of Operations

Johnson Hospital
Statement of Operations (in '000s)
For the Year Ended September 30, 2016

Unrestricted revenues:
Patient revenues (net of contractual) ______
Provision for bad debt expense ______
Net patient revenues ______
Net assets released from temporary restriction ______
Total revenues: _____

Operating expenses:
Labor expense _____
General expense _____
Supply expense ______

Depreciation expense:
Interest expense ____
Total operating expenses ______

Excess of revenues over expenses _____
Transfer to parent corporation ______
Increase in unrestricted net assets: ______

Changes in Net Assets

Johnson Hospital
Statement of Changes in Net Assets (in '000s)
For the Year Ended September 30, 2016

Unrestricted net assets:
Excess of revenues over expenses _______
Unrestricted contributions ________
Transfer to parent corporation ______
Change in unrestricted net assets _______

Temporarily restricted net assets:
Net assets released from temporary restriction _______
Change in temporarily restricted net assets _______

Permanently restricted net assets:
Change in permanently restricted net assets ______
Increase in net assets ______
Beginning balance, net assets ______
Ending balance, total net assets: ______