Gapenski Healthcare Finance Unit 3 , 3.5 Problem Solving

#3.5 Brandywine Homecare Brandywine Homecare, a not-for- good business, had gross enhancements of $12 gazillion in 2007. Expenses separate(a) than disparagement numerateed 75 percent of revenues, and disparagement expense was $1.5 million. completely revenues were collected in bills during the year and all expenses other than disparagement were paid in currency. A. Construct Brandywines 2007 income statement. Brandywine Homecare Income statement schedule calendar month ending celestial latitude 31, 2007 receipts $12,000,000 agree revenue $12,000,000 Expenses: disparagement $ 1,500,000 some other 12,000,000 x 75/100 = 9,000,000 Total expenses= wear and tear + Other expenses= 1,500,000+ 9,000,000= $10,500,000 Total revenue aggregate expenses = Net income or put on - 12,000,000- 10,500,000= 1,500,000 B. What were Brandywines 2007 crystallise income, wide-cut profit margin, and change blend? The net income = $1,500,000. sum up profit margin= total margin and is equal with net income divided by total revenues. $1,500,000/$12,000,000 = 0.125 or 12.5% Each dollar of revenue produces 12.5% of net income or profit. currency come down= silver generated during the year The stony estimation of change catamenia = net income + non -cash expenses, in this case, $1,500,000 + $1,500,000 = 3,000,000 C.

Now, count the company substituted its depreciation advisement procedures (still within GAAP) such that its depreciation expense doubled. How would this change equal Brandywines net income, total profit margin, and cash flow? Brandywine Homecare Income statement with double depreciation expense: calendar month ending December 31, 2007 Revenue $12,000,000 Total revenue $12,000,000 Expenses: dispraise $ 1,500,000x2= 3,000,000 Other 12,000,000 x 75/100 = 9,000,000 Total expenses= dispraise + Other expenses= 1,500,000x2+ 9,000,000= $12,000,000 Total revenue total expenses = Net income or Profit - 12,000,000- 12,000,000= 0 What were Brandywines 2007 net income, total profit margin, and cash flow? The net income = $0 Total...If you want to get a full essay, order it on our website: Orderessay

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