Question # 1
a. How does this balance sheet differ from the one presented in Table 1 for Sunnyvale?
b. What is BestCare's net working capital for 2007?
c. What is BestCare's debt ratio? How does it compare with the debt ratio for Sunnyvale?
Question # 2
a. In the last decade, has the role of finance become more important or less important? Why? Is this good or bad?
b. Comment on the role of finance in the Healthcare industry. What do you see as its role?
TABLE 1: Sunnyvale Clinic: Balance Sheet-
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Sunnyvale Clinic: Balance Sheet
December 31, 2007 and 2006 (in thousands)
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ASSETS
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2007
|
2006
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Current Assets:
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|
|
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Cash
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$12,102
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$6,486
|
|
Short-term investments
|
io,000
|
5=o
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Net patient accounts receivable
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28,509
|
25.927
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Inventories
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3.695
|
2,302
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Total current assets
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$54.31
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$39.72
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Long-term investments
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$48.06
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$25.84
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|
Property and Equipment (Fixed Assets):
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|
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Land
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$2,954
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$2.04
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Buildings and equipment
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85.595
|
77.208
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Gross fixed assets
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$88,549
|
$79.24
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Less: Accumulated depreciation
|
36,099
|
29,694
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Net fixed assets
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$52.45
|
$49.55
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Total assets
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$154,815
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$115,101
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LIABILITIES AND EQUITY
|
2007
|
2006
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Current Liabilities:
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|
|
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Notes payable
|
4.334
|
3.345
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Accounts payable
|
5.022
|
6.933
|
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Accrued expenses:
|
6,069
|
5,037
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Total current liabilities
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$15,425
|
$15,315
|
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Long-term debt
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$85.32
|
$53.58
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Total liabilities
|
$100.75
|
$68,893
|
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Net assets (Equity)
|
$54.07
|
$46,208
|
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Total liabilities and equity
|
$154.82
|
$115,101
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Table 2: BestCare HMO Balance Sheet-
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BestCare HMO Balance Sheet
June 30, 2007 (in thousands)
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Assets
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|
Current Assets:
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Cash
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$2,737
|
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Net premiums receivable
|
821
|
|
Supplies
|
387
|
|
Total current assets
|
$3,945
|
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Net property and equipment
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$5,924
|
|
Total assets
|
$9,869
|
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Liabilities and Net Assets
|
|
Accounts payable-medical services
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$2,145
|
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Accrued expenses
|
929
|
|
Notes payable
|
382
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Total current liabilities
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$3,456
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Long-term debt
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$4,295
|
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Total liabilities
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$7,751
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Net assets-unrestricted (equity)
|
$2,118
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Total liabilities and net assets
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$9,869
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