A. Re-order the data in proper Income Statement format. B. Calculate the Net Inc
ID: 2591190 • Letter: A
Question
A. Re-order the data in proper Income Statement format. B. Calculate the Net Income, Profit Margin. C. How can NI&PM results be interpreted?
Investment Income $40,000
Total expenses $420000
Provision for bad debts $40,000
Salaries and benefits $150,000
Patient Services revenues $440,000
Interest Expense $20,000
Depreciation Expense $90,000
General/administrative expenses $70,000
Purchased Clinic Services $90,000
Other Revenue $10,000
Net Operating Revenues $410,000
Explanation / Answer
Answer:
1
Income statement
Particulars
Amount $
Amount $
Patient Services revenues
440,000
Other Revenue
10,000
Less:
Provision for bad debts
40,000
Net Operating Revenue
410,000
Add: Investment revenue
40,000
Total Revenue
450,000
Less: expanses
Salaries and benefits
150,000
General/administrative expenses
70,000
Purchased Clinic Services
90,000
Interest Expense
20,000
Depreciation Expense
90,000
Total expanse
420,000
Net income
30,000
2
Net Income,=$30,0000
Net Profit Margin as % of total revenue is
=,000/450,000
=0.067
=6.67%
Net Profit Margin as % of operating revenue is
=30,000/410,000
=0.073171
=7.32%
3
We can say that Net Profit Margin as % of total revenue is is 6.67%
Net Profit Margin as % of net revenue is is 7.32%
Major income of form is earned by Patient Services revenues
Income statement
Particulars
Amount $
Amount $
Patient Services revenues
440,000
Other Revenue
10,000
Less:
Provision for bad debts
40,000
Net Operating Revenue
410,000
Add: Investment revenue
40,000
Total Revenue
450,000
Less: expanses
Salaries and benefits
150,000
General/administrative expenses
70,000
Purchased Clinic Services
90,000
Interest Expense
20,000
Depreciation Expense
90,000
Total expanse
420,000
Net income
30,000
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