John Hopkins Hospital Case Study

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The Johns Hopkins Hospital long history has likewise possessed the capacity to give broad budgetary data that has been given consistently in monetary reports. These reports have given significant data to speculators investigating the organization of its current and past financial responsibility to its community and internal stakeholders.

Balance Sheet Case Study of John Hopkins Hospital
The Johns Hopkins Hospital officially opened May 7, 1889. It was the first teaching hospital, designed to unite functions of patient care with education and research. Today the hospital has evolved into one of the largest teaching hospitals in the country (The Alan Mason Chesney, 2015). The Johns Hopkins Hospital long history has also been able to provide …show more content…

Since companies are often unable to sell their fixed assets within any reasonable amount of time they are carried on the balance sheet at cost regardless of their actual value. As a result, it is possible for companies to grossly inflate this number, leaving investors with questionable and hard-to-compare asset figures (Investopedia.com, 2003). The total asset for Johns Hopkins Hospital is $ 2,769,848 for the reporting date of June 30, 2012. Since the balance sheet has to balance this amount will also appear in the liabilities section of the balance sheet.

Liabilities are debts owed that are grouped into two different categories, current and noncurrent. Current liabilities are to be paid within the business cycle such as accounts payable, while long-term liabilities have more time to be paid off that surpasses the twelve-month cycle. These accounts are most often paid after current assets have liquidated to cash to pay outstanding liabilities that are coming due. The balance sheet for Johns Hopkins Hospital does balance since both assets and liabilities total …show more content…

The current ratio measures the hospitals ability to meet short-term obligations with short-term assets. A social enterprise needs to ensure that it can pay its salaries, bills and expenses on time. A ratio less that 1 may indicate liquidity issues (Demonstrating Value, 2015).
Current Ratio (Current Assets/ Current Liabilities)
0.81 = 407,053/499,783
Ratio 0.81:1
According to National Healthcare Historical Current Ratio Data, on June 30, 2012 the national average was 1.812. Based on the national average Johns Hopkins was barely meeting their financial responsibilities in 2012. The health of this company needs further investing; the next step will be to analyze the operating statement also known as the income statement.

The information provided in the Operating Statement of Johns Hopkins Hospital shows the operating revenue (the daily business that generates income) was 1,791,899 and total-operating expenses including such items as salaries, supplies, provision for bad debt etc. was 1,706,672. By subtracting operating revenue from operating expenses the gross profit can be calculated, which totaled

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