Patton-Fuller Community Hospital Ratio Computation 2009 and 2008 This paper will show the ratio computations to Patton-Fuller Community Hospital. From these computations, taken from the Unaudited and Audited Reports from 2009 and 2008, Team E will address significant changes, if any occurred, and address what Patton-Fuller Community Hospital plans are within the next year to five years regarding any changes. In closing this paper will address the reasons that our team agrees or disagrees with the CEO’s report presented to the Board. In addressing the ratio computations for 2009 and 2008, Unaudited and Audited reports, below, there were no significant changes between the two reports. From 2008 to 2009, the current assets
Day Receivables: Net Receivables/Net Credit Revenues divided by Number

of days in period. Net Receivables_________________ Net Credit Revenue Divided by # Days in Period (365)

3 Step Process

Step 1 Total Operating Revenue x Percent of Credit Revenues (Information Obtained Elsewhere)

Step 2 Total from Step 1 365

Step 3 Accounts Receivable (net) = days Total from Step 2

2009 462,982 x 90% = 416,683.8 / 365 = 1141.6
59,787 / 1,141.6 = 52.37 days
2008 421,314 x 90% = 379182.6 / 365 = 1,038.36
37, 666 / 1,038.36 = 36.3 days
Solvency Ratios
5). Debt Service Coverage Ratio (DSCR)

Change in Unrestricted Net Assets (net income) + interest, Depreciation,

Amortization/Maximum Annual Debt Service

(2009) 627 + 36,036 + 3,708/14,609 = 2.8:1

(2008) (15,846) + 24,955 + 3,597/4,195 = 3.0:1

6). Liabilities to Fund Balance

Total Liabilities/Unrestricted Fund Balances

(2009) 462,153/126,584 = 3.7:1 (2008) 213,450/335,035 = 0.64:1

Profitability Ratios

7). Operating Margin (%)

Non- Operating Income (Loss)/Total Operating Revenues

(2009) (62)/689 = 0.09:1 (2008) 264/ (16,110) = 0.02:1

8). Return of Total Assets (%)

EBIT (Earnings before Interest and Taxes/Total Assets)

(2009) 462,982/588,767 =