HCA 270 WEEK 4 CheckPoint Ratio Analysis
HCA 270 WEEK 4 CheckPoint Ratio Analysis fin571
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This 0 page Study Guide was uploaded by an elite notetaker on Tuesday November 10, 2015. The Study Guide belongs to fin571 at Kaplan University taught by in Fall 2015. Since its upload, it has received 25 views.
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Date Created: 11/10/15
Current ratio 69003200 22 Total asset 568 17900 003 Arcadia s current ration of 22 slightly above the median average of 207 was good because it meant they had a great deal of cash and marketable securities I m not really sure if I was correct on the total asset but it was quiet a bit smaller at 003 than the median average of 101 This would mean they do not have very effective revenue generation from the asset base Asset Equity 179007900 227 Long term debt Equity 100007900 126 Total Margin 32568 563 Asset Equity and Longterm Equity are both leverage ratios Asset Equity is a capital structure The choice of the mix of debt and equity financing determines the organization s capital structure Longterm debt Equity are coverage meaning it involves a choice of how much interest to pay The organization s earnings and cash ows determine which interest obligations are covered or met Total margin is a profitability ration It indicates the amount of profit earned per dollar but says nothing about the economic return in place or the organization s ability to pay the required return to its equity holders It says more about an organization s ability to keep its unit prices above cost than about its ability to generate economic return An asset equity ratio above 10 means the organization has gone into debt This means that every dollar of Arcadia s equity controlled 227 of its total assets The longterm debt equity were 040 or 40 This was higher than the median average of 31 I Wish I could tell you What this meant but I could not figure it out The total margin is in the amount of profit earned per dollar of revenue meaning Arcadia must not have earned any profit on its revenues
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