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I NEED ACCOUNTING HELP ASAP!

FIRST SET OF PROBLEMS:

PROBLEM 1

Assume Venture Healthcare sold bonds that have a 10 year maturity, a 12 percent coupon rate with annual payments, and a $1,000 par value. Suppose that two years after the bonds were issued the required interest rate fell to 7%.

a. What would be the bond’s value?

b. Suppose that two years after the bonds were issued, the required interest rate rose to 13%. What would be the bonds value?

c. What would be the value of the bonds three years after issue if the bond rate is 7% assuming that interest rates stayed steady at either 7% or 13%?

PROBLEM 2

Twin Oaks Health Center has a bond issue outstanding with a coupon rate of 7% and four years remaining until maturity. The par value of the bond is $1,000, and the bond pays interest annually.

a. Determine the current value of the bond if present market conditions justify a 14% required rate of return?

b. Now suppose Twin Oaks four year bond had semiannual coupon payments. What would be its current value? (Assume a 7% semiannual required rate of return. The actual rate would be slightly less than 7% because a semiannual coupon bond is slightly less risky than an annual coupon bond.)

c. Assume that Twin Oaks bond had a semiannual coupon but 20 years remaining to maturity. What is the current value under these conditions? (Assume a 7% semiannual required rate of return although the actual rate would probably be greater than 7% because of increased risk.)

PROBLEM 3

Minneapolis Health System has bonds outstanding that have four years remaining to maturity, a coupon interest rate of 9% paid annually and a $1,000 par value.

a. What is the yield to maturity on the issue if the current market price is $829?

b. If the current market price is $1,104

c. Would you be willing to buy one of these bonds for $829 if you required a 12% rate of return on the issue?

d. Explain your answer.

PROBLEM 4

Six years ago Bradford Community Hospital issued 20-year municipal bonds with a 7% annual coupon rate. The bonds were called today for a $70 call premium – that is, bondholders received $1,070 for each bond.

a. What is the realized rate of return for those investors who bought the bonds for $1,000 when they were issued?

PROBLEM 5

A person is considering buying the stock of two home health companies that are similar in all respects except the proportion of earnings paid out as dividends. Both companies are expected to earn $6 per share in the coming year, but Company D (for dividends) is expected to pay out the entire amount as dividends, while Company G (for growth) is expected to pay out only one third of its earnings or $2 per share. The companies are equally risky and their required rate of return is 15%. D’s constant growth rate is zero and G’s is 8.33.

a. What are the intrinsic values of stocks D and G?

PROBLEM 6

Medical Corporation of America (MCA) has a current stock price of $36 and its last dividend was (D0)$2.40. In view of MCA’s strong financial position, its required rate of return is 12%.

a. If MCA’s dividends are expected to grow at a constant rate in the future, what is the firm’s expected stock price in five years?

PROBLEM 7

A broker offers to sell your shares of Bay Area Healthcare which just paid a dividend of $2 per share. The dividend is expected to grow at a constant rate of 5% per year. The stock’s required rate of return is 12%.

a. What is the expected dollar dividend over the next three years?

b. What is the current value of the stock and the expected stock price at the end of each of the next three years?

c. What is the expected dividend yield and capital gains yield for each of the next three years?

d. What is the expected total return for each of the next three years?

e. How does the expected total return compare with the required rate of return on the stock?

f. Does this make sense?

g. Explain your answer.

PROBLEM 8

Lucas Clinic’s last dividend (D0 ) was $1.50. Its current equilibrium stock price is $15.75, and its expected growth rate is a constant 5%.

a. If the stockholders’ required rate of return is 15% what is the expected dividend yield and expected capital gains yield for the coming year?

SECOND SET OF PROBLEMS:

Here are the budgets of Brandon Surgery Center for the most recent historical quarter (in thousands of dollars):

Static Flexible Actual

Number of surgeries 1,200 1,300 1,300

Patient revenue $2,400 $2,600 $2,535

Salary expense $1,200 $1,000 $1,365

Non salary expense $ 600 $ 650 $ 585

Profit $ 600 $ 650 $ 585

The center assumes that all revenues and costs are variable and hence tied directly to patient volume.

a. Explain how each amount in the flexible budget was calculated.

b. Determine the variance for each line of the profit and loss statement in both dollar terms and percentage terms (Each line has a total variance, a volume variance, and a price variance [for revenues] and management variances [for expenses].

c. What do the part b results tell Brandon’s managers about the surgery centers operations for the quarter?

QUESTION 2 CAROLL CLINIC: NEW 2011 RESULTS

1. Volume

A. FSS 34,000 visits

B. Capitated lives 30,000 members

Number of member months 360,000

Actual utilization per

Member per month

Member per month 0.12

Number of visits 43,200 visits

C. Total actual visits 77,200 visits

2. Revenues

A. FFS $28 visit

X 24,000 actual visits

$952,000

B. Capitated lives $ 2.75 PMPM

X 360,000 actual member visits

$990,000

C. Total actual revenues $1,942,000

Costs

A. Variable costs:

Labor $1,242,000 (46,000 hours at $27/visit)

Supplies $ 126,000 (90,000 units at $1.40/unit)

Total variable costs: $ 17.72 ($1,368,000 x 77,200)

B. Fixed costs:

Overhead, plant

And equipment $525,000

C. Total actual costs: $1,893,000

Profit and Loss Statement:

Revenues

FFS $952,000

Capitated $990,000

Total $1,942,000

Costs

Variable:

FFS $602,487

Capitated $765,513

Total $1,368,000

Contribution margin $574,000

Fixed Costs $525,000

Actual profits $49,000

a. Construct the flexible budget for 2011.

b. What are profit variance?

Revenue variance?

What is the cost variance?

Consider the revenue variance. What is the component volume variance?

What is the price variance?

Break down the management variance into labor, supplies, and fixed costs variances.

PAPER REQUIREMENTS:

Provide the following information regarding a dental practice:

Write a 10-12 page paper in which you:

1. Determine what your selected organization would need to take into account when making pricing and service decisions.

2. Describe the overall planning process and the likely components of the selected organization’s financial plan. Be sure to include a discussion as to how you arrived at the answers and use specific examples to illustrate your response.

3. Discuss how time value analysis would help your organization make sound management decisions, use specific examples to illustrate your response.

4. Recommend a major investment for the organization you selected using net present value, pertinent financial ratios, and break-even analysis.

5. Determine the most likely way your selected organization should address financial risk and required returns.

6. Provide at least four (4) qualified resources e.g. peer-reviewed journals, professional organization websites, or health care provider websites. The cover page and reference page are not included in the required length of the paper.

Your assignment must be typed, double spaced using Times New Roman font size 12 with one inch margins on all sides; paper must follow APA formatting Paper must include a traditional header with running header on title page, and page numbers.

Include a cover page that includes:

a. Title of paper: Planning and Budgeting

b. Name of student: Kimberly A. Fahringer

c. Course title: HAS 525 Health Care Finance

d. Professor’s name: Dr. James Coon

e. Date (due May 11, 2012)

The goals of this assignment are:

Describe the overall planning process and the key components of the financial plan

Develop a competence in making financial decisions using net value, pertinent financial ratios, and break-even analysis

Explain why time value analysis is so important to health care financial management

Use technology and information resources to research issues in health financial management

Write clearly and concisely about health financial management using proper writing techniques.

Answer
Submitted by Asma on Thu, 2012-05-10 16:09
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Solution is attached

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xxxxxx xxxx xxx solution files attached here.

xx

file1.xls preview (89 words)

Sheet1

xxxxxxxxx
xxx xxxxx xxxx xxxxxxxx Community Hospital issued xxxxxxx xxxxxxxxx bonds xxxx a x percent xxxxxx
xxxxxx xxxxx xxx xxxxx were called today for a xxx call premium--that xxx xxxxxxxxxxx received $1,070
for xxxx xxxxx xxxx xx the realized rate xx return xxx those investors who xxxxxx xxx xxxxx xxx $1,000
when xxxx were xxxxxxx
xxxxxx
xxxx xxxxxx 1,070
xxxxxx xxxxxxxxxx
Purchase xxxxx* xxxxx
Call xxxxxx 6Realized return over the time period is annualized return calculated
Realized xxxxxx 8.0% xxxxx xxx RATE function xxxxxx xxxx account the xxxxxxxx xxxxxx annual interest and xxxx price

xxxxxx

x

xxxxxx

file2.xls preview (1154 words)

xxxx xxxx

xxxxxxxxxxxxxxxxxxxxx
Chapter 6 -- xxxxxx Financing and xxxxxxxxxx xxxxxxx
xxxxxxx x xx xxxxxxxxxx xxxxxxxxxx Market xxxxxxxxxxx xxx Debt xxxxxxxxx
PROBLEM x
A broker xxxxxx to sell you xxxxxx of Bay xxxx Healthcare, xxxxx just paid a dividend xx $2 per xxxxxx
The dividend xx expected to grow xx a xxxxxxxx xxxx of 5 percent xxx year. xxx stock's xxxxxxxx rate of
xxxxxx is 12 percent.
a. What xx xxx expected dollar dividend xxxx xxx xxxx three years?
b. What is the xxxxxxx value xx the stock xxx the xxxxxxxx xxxxx price xx the end xx xxxx xx the xxxx xxxxx
years?
xx xxxx xx the xxxxxxxx xxxxxxxx xxxxx and capital gains yield for xxxx of xxx next xxxxx xxxxxx
xx xxxx xx the xxxxxxxx total xxxxxx for each xx the xxxx xxxxx xxxxxx xxx does xxx xxxxxxxx xxxxx xxxxxx
compare xxxx the required rate of return xx xxx stock? xxxx xxxx xxxx xxxxxx Explain your answer.
ANSWER
Nper4
Rate 14%
FVxxxx
xxxxx
xx($796.04)
Nper x
xxxxxxxx
FV 1000
xxxxx
PV($1,000.00)
xxxxx

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file3.doc preview (3222 words)

FIRST xxx xx xxxxxxxxx

xxxxxxxxxx 1�xxxxxx xxxxxxx xxxxxxxxxx sold bonds that xxxx a 10 year maturity, x xx xxxxxxx coupon rate xxxx annual payments, xxx a xxxxxx par value. xxxxxxx that xxx years after the xxxxx xxxx issued the xxxxxxxx interest xxxx xxxx xx 7%.�a. What would xx xxx xxxx’x value?�b. xxxxxxx that two years after the xxxxx were xxxxxxx xxx required xxxxxxxx xxxx rose to xxxx What xxxxx be xxx xxxxx xxxxxxxxxxx What xxxxx xx the xxxxx xx the xxxxx xxxxx xxxxx xxxxx issue if xxx bond rate is xx xxxxxxxx that xxxxxxxx xxxxx xxxxxx xxxxxx at either xx xx xxxxxxx

Solution:

a. What would be the bond’s xxxxxx

xxxxxxxxx + xxxx xxxxxxx= $1290

xxx Suppose that xxx yrs after the xxxxx xxxx xxxxxxx xxx xxxxxxxx xxxxxxxx rate xxxx xx xxxxxxxx would xx the bond's value?

120*4.7988 x xxxx xxxxxxx= xxxx

(C) What xxxxx xx xxx xxxxx xx xxx xxxxx x xxx xxxxx xxxxx in xxxx xxxxxxxx xxxxxx assuming that interest rates stayed at xxxxxxxx or 13%?

120*5.3893 + 1000 *.6227 x

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Answer
Submitted by Asma on Thu, 2012-05-03 14:51
teacher rated 374 times
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purchased 2 times
price: $100.00

Solved Portion is here - Including paper

body preview (13 words)

x xxxx xxxxxx xxxxx problems which are completely solved.You can xxxxx xxxxxx

file1.doc preview (3222 words)

FIRST SET OF xxxxxxxxx

xxxxxxxxxx 1�xxxxxx Venture Healthcare sold bonds that xxxx x 10 xxxx maturity, x xx xxxxxxx coupon rate xxxx xxxxxx xxxxxxxxx xxx a xxxxxx par value. xxxxxxx that two xxxxx xxxxx the bonds xxxx issued xxx required xxxxxxxx xxxx xxxx to 7%.�a. xxxx xxxxx xx the bond’s value?�b. xxxxxxx that two xxxxx after xxx bonds were issued, the xxxxxxxx interest rate xxxx xx 13%. What would be xxx bonds xxxxxxxxxxx What would xx xxx value xx xxx bonds three xxxxx after issue xx xxx bond xxxx xx 7% xxxxxxxx xxxx xxxxxxxx rates xxxxxx steady xx xxxxxx 7% xx 13%?�

xxxxxxxxxx

xx xxxx xxxxx be the xxxx’s value?

120*5.971 + xxxx xxxxxxxx $1290

(B) xxxxxxx xxxx two yrs xxxxx xxx xxxxx were xxxxxxx xxx xxxxxxxx interest rate xxxx xx xxxxxxxx would be xxx xxxxxx value?

xxxxxxxxxx x xxxx *.3762 = $952

xxx xxxx xxxxx xx xxx xxxxx of xxx xxxxx 3 yrs xxxxx xxxxx in each scenario xxxxxx xxxxxxxx xxxx xxxxxxxx rates xxxxxx at xxxxxxxx or 13%?

xxxxxxxxxx x 1000 xxxxxxx=

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xxxx xxxx

xxxxxxxxxxxxxxxxxxxx
xxxxxxx 6 xx Equity xxxxxxxxx and Investment Banking
Chapter 7 xx Securities Valuation, xxxxxx xxxxxxxxxxx xxx xxxx xxxxxxxxx
xxxxxxx 3
x xxxxxx offers xx sell xxx xxxxxx of xxx xxxx Healthcare, xxxxx xxxx xxxx x xxxxxxxx xx $2 per xxxxxx
xxx dividend is xxxxxxxx xx grow xx x xxxxxxxx xxxx of 5 percent per xxxxx xxx stock's xxxxxxxx xxxx xx
xxxxxx is xx percent.
xx xxxx xx the xxxxxxxx xxxxxx xxxxxxxx xxxx the next three years?
xx xxxx xx xxx current xxxxx xx the stock xxx xxx xxxxxxxx xxxxx xxxxx at xxx xxx xx each of the xxxx three
years?
c. What is the xxxxxxxx xxxxxxxx yield and xxxxxxx xxxxx yield for xxxx of xxx xxxx three xxxxxx
d. xxxx xx xxx expected total return xxx each of xxx next xxxxx years? xxx does xxx expected total return
compare xxxx xxx xxxxxxxx rate xx return on xxx stock? xxxx this make xxxxxx Explain xxxx xxxxxxx
xxxxxx
xxxx4
xxxx14%
xx 1000
xxx 70
xx($796.04)
xxxxx
xxxx 3.5%
FV1000
PMTxx
xx xxxxxxxxxxx
xxxxx

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file3.xls preview (89 words)

Sheet1

xxxxxxxxxxx
Six years xxxx xxxxxxxx Community Hospital issued xxxxxxx xxxxxxxxx bonds with a x xxxxxxx annual
xxxxxx rate. xxx xxxxx were called today for a xxx xxxx xxxxxxxxxxxxx is, xxxxxxxxxxx received xxxxxx
for xxxx bond. xxxx xx the realized xxxx of xxxxxx xxx xxxxx xxxxxxxxx who xxxxxx the xxxxx for xxxxxx
when xxxx xxxx xxxxxxx
ANSWER
xxxx xxxxx* 1,070
Annual xxxxxxxx70
Purchase xxxxx* xxxxx
xxxx xxxxxx 6xxxxxxxx return xxxx xxx xxxx xxxxxx is annualized return calculated
Realized xxxxxxxxxxusing xxx xxxx function taking into xxxxxxx the purchase xxxxxx annual xxxxxxxx and xxxx xxxxx

Sheet2

x

Sheet3

x

file4.docx preview (3583 words)

Planning & xxxxxxxxx

HAS xxx Health Care Finance

xxxxxxxx xx Fahringer

xxx James xxxx

May 10, xxxx

xxx objective xx this xxxxx xx to determine xxxx x hypothetical dental xxxxxxxx would need to take into account when making xxxxxxx and service xxxxxxxxxx xxx paper will describe overall planning xxxxxxx xxx xxx likely xxxxxxxxxx of a hypothetical dental practice’s xxxxxxxxx plan. The xxxxx will xxxxxxx xxx xxxx value analysis would help a xxxxxxxxxxxx dental xxxxxxxx make xxxxx management decisions, utilizing specific examples. xxx xxxxx xxxx xxxxxxxxx x major investment for x hypothetical dental xxxxxxxx using net xxxxxxx value, pertinent xxxxxxxxx ratios, and break-even xxxxxxxxx The paper xxxx xxxx determine the most likely xxx a hypothetical dental xxxxxxxx xxxxxx xxxxxxx xxxxxxxxx xxxx xxx required returns.

A xxxxxxxxxxxx xxxxxx xxxxxxxx xxxxx xxxx to xxxx xxxx xxxxxxx several factors xxxx making pricing xxx xxxxxxx xxxxxxxxxx The business xxxxx need xx xxxxxx what

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