MHA 706 Module 3 Questions and Answers 100% Correct

MHA 706 Module 3 Questions and

Answers 100% Correct


Ratio Analysis - ANSWER-technique used in financial condition analysis




Financial ratio analysis - ANSWER-combines values from the financial

statements to create single numbers that facilitate comparisons




Profitability ratio - ANSWER-answers the question- is the business generating

sufficient profits




Liquidity ratio - ANSWER-can the business meet its cash obligations or debts




Debt management ratio - ANSWER-answers whether the business is using

the right mix of debt and equity




Return on equity - ANSWER-for every dollar invested by the owners or the

community in this case, the hospital is generating about $__ in net profit.

, With the debt ratio - ANSWER-the higher the number it's worse. So you want

lower values. While in the times interest earned, higher are better.




FA turnover - ANSWER-total revenue (net operating + nonoperating)/ net

fixed assests




Asset Management - ANSWER-looks at whether the business has the right

amount of assets for the patient volume that it has.




Total margin - ANSWER-net income /total revenue




Operating margin - ANSWER-operating income/operating revenue




ROA - ANSWER-net income/ total assets




ROE - ANSWER-net income/ total equity




Return on assets - ANSWER-for every dollar that we invested in assets, the

hospital generated about $__ in net profit.