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Review the financial statement very carefully. Then, answer the following questions based on the financial statements and using the tools in the Financial Analysis Ratios file.
You will have 1 hour to answer the timed 7 questions.
1) Is this a for-profit or a not-for-profit hospital? How can you tell?
2) Calculate and interpret the total operating margin for the years presented? Please show all your work!
3) Calculate and interpret the return on assets for the years presented? Please show all your work!
4) Calculate and interpret the return on equity for the years presented? Please show all your work!
5) Calculate and interpret the average collection period for the years presented? Please show all your work!
6) Calculate and interpret the debt ratio for the years presented? Please show all your work!
7) The hospital provides charity care to eligible patients at reduced or no cost based upon the individual patient's financial resources. How do they calculate charity care eligibility? How much was charity care for 2012 and for 2011? Please reference your reply. [Hint: you must read the notes to financial statement]