Ration Analysis in Decision Making Assignment Example | Topics and Well Written Essays - 1000 words

proportionalityn Analysis in Decision qualification - Assignment ExampleThe healthcare phoner that is sacking to be evaluated in this report is Cameron monument fraternity hospital. The financial statements of Cameron Memorial friendship infirmary are illustrated in Appendix A and B. The tool that is going to be used to analyze the financial statements of the accompany is proportionality analysis. The Cameron Memorial hospital was founded in 1926 by Don F. Cameron. The hospital is a 25 bed Critical Access Community Hospital. CMCH is a oecumenical healthcare system that services the Tri-State Area of Northeast Indiana, South Central Michigan and Northwest Ohio (Cameronmch). many of the services offered at Cameron Memorial Community Hospital include radiology, sleep center, surgical services, occupational health, and hospice care. there are over 100 doctors working at Cameron Memorial Community Hospital. In order to acquiesce with its civic duties and social responsibili ty the hospital created the Cameron Hospital Foundation. The 2010 fiscal year of Cameron Memorial Community Hospital started September 30, 2009 and ended September 30, 2010. In 2010 Cameron Memorial Community Hospital generated get along revenues of $41.94 million (In). The companys revenues increase by 4.98% in comparison with fiscal year 2009. The total expenses of the hospital in 2010 were $41.10 million. The net margin of the company in 2010 was 4.51%. The net margin is an absolute measure of profitability. It is calculated by dividing net income by total revenues. In order to determine whether the net margin of Cameron Memorial Community Hospital is good or not we must compare it to the exertion standard. A good database that has learning regarding the attention standards across different industries is the Dun & Bradstreet database. The health care industry net margin industry standard is 4.2% (Dun & Bradstreet). The net margin of Cameron Memorial Community Hospital was abo ve the industry standard by 0.31%. The table below illustrated a ratio analysis of Cameron Memorial Community Hospital in 2010. Cameron Memorial Community Hospital 2010 Net Margin 4.52% Return on Equity 7.30% Return on Assets 4.12% Debt Ratio 2.29 Current Ratio 1.97 Working Capital $4380419 Debt to Equity 0.77 The come down on equity of Cameron Memorial Community Hospital in 2010 was 7.30%. The return on equity metric unit measures how effective a company was at generating winnings from its total equity. The formula to calculate return on equity is dividing net income by total equity. The industry standard return on equity is 9.2% (Dun & Bradstreet). The return on equity of Cameron Memorial Community Hospital in 2010 was 1.90% below the industry standard. The return on assets of the company in 2010 was 4.12%. The return on assets metric can be calculated by dividing net income by total assets. The industry standard return on assets is 4.30% (Dun & Bradstreet). The return on asset s ratio measures how effective a company was at generating profits from its total assets. The return on assets of Cameron Memorial Community Hospital was 0.18% below the industry standard. The debt ratio measures a companys ability to pay off its long term debt. The debt ratio is calculated dividing total assets by total liabilities. The debt ratio of Cameron Memorial Community Hospital in 2010 was 2.29. The general rule for a debt ratio is that a debt