1.) Find current and quick ratio. Show work 2.) Find both operating and total ma

Question

1.) Find current and quick ratio. Show work
2.) Find both operating and total margin. Show work.
3.) Find debt ratio, equity ratio, and debt-to-equity ratio. Show work.

MedStar Health, Inc. Consolidated Statements of Operations and Changes in Net Assets For the Three and Six Months Ended December 31, 2017 and 2016 Dollars in millions) Three Months Ended 2017 2917 Actual Bedget Actval AteadBudget Aciaad Sis Montis Entiet December 31. 2816 December 31 Operating revenues: Net patient service revenue Provision for bad debts $1,242.4 SAM7 (40) Oa 1,187.3 1,1443 1,1154 234L9 1332 $1,200.6 (55.1) (563) S1,1695 $2.3%.6 $2. 013 Total net patient service revenue, net of provision for bad debts 142.7 20992027 52.6 1,394.2 1,406.8 13688 Other operating revenue 1447 1.3688 27782 24 2742 64.2 50.7 123 Net operating revenues Operating expenses: 774.3 7482 7378 1,5093 L887 142 2033 191.8 Purchased services Other operating Interest expense 188.9 207.9 245.2 2314 118.6 134.6 134.2 3927 447-489 4556 2424 263 558 11.1 49.1 1,368.1 1.3885 1,3525 115 12.5 52.5 22.8 104.9 2.719.6 243 224 ma 56.2 Total operating expenses Earnings from operations 26.1 18.3 16.3 43.5 , Non-operating gains (losses): Investment income Net realized gains on sale of investments Unrealized gains on derivative instruments Unrealized gains (losses) on investments Other 5.8 17.0 0.9 4.8 6.3 10.4 9S 73 7.1 3.4 24.6 125 1H 33.8 10.6 (13.2) 14 85.8 4.3 214 402 Total non-operating gains (losses) 115.6 Excess of revenue over expenses $80.4 $39.9 $18.4 $174.2 SsS S1133

Explanation / Answer

Current assets in this case = total liabilities-net assets

=3776.5-1854.2=1922.3

Current ratio = current asset/current liability

=1922.3/1164.5=1.651 for dec.17

Current assets for June 30 = 3838-1670.3 =

2167.7

Current ratio for June 30 = 2167.7/1217.6 = 1.780

Current assets for Dec 31:2016 = 3304-1423.3=1880.7

Current ratio for Dec 16 = 1880.7/1172.2 = 1.604

Quick ratio = quick asset/current liabilities

In the present case no no specific breakup of current aset is not given therefore quick ratio cannot be calculated.

2) operating margin = operating profit/total revenue

*Since it is not mentioned that for fhich period these ratio are required I am solving for three month ended 31 dec actual and in the similar manner others can also be done

Three months ended 31 dec 17 actual

Operating margin = (26.1/1394.2)x100=1.87%

Three months ended 31 Dec 2016

Operating margin = (16.3/1368.8)x100=1.19%

Total margin = net income/total revenue

Three months ended 31 Dec 2017 actual

Total margin = (80.4/1394.2)x100=5.767%

Three months ended 1 Dec 2016 actual

Total margin = (18.4/1368.8)x100=1.34%

3) Debt ratio = Total debt/total assets

Long term liability / total assets

For 31 Dec 2017 actual

Debt ratio = 2612/3776.5=69.165%

Equity ratio = common stock/total assets

In the present case net assets/total assets

Equity ratio for 31 Dec 2017 = 1854.2/3776.5=49.098%

Debt to equity ratio = total liability/total equity

3776.5/1854.2=2.037

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