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Business, 20.08.2019 22:30 luludawn2455

Consider the following financial statements for green valley nursing home, inc., a for-profit, long-term care facility: green valley nursing home, inc. statement of income and retained earnings year ended december 31, 2xxxrevenue: net patient service revenue$3,163,258other revenue$106,146 total revenues$3,269,404expenses: salaries and benefits$1,515,438medical supplies and drugs$966,781insurance and other$296,357rent$110,000depreciati on$85,000interest$206,780 total expenses$3,180,356operating income$89,048provision for income taxes$31,167net income$57,881retained earnings, beginning of year$199,961retained earnings, end of year$257,842green valley nursing home, inc. balance sheet year ended december 31, 2xxxassetscurrent assets: cash$105,737marketable securities$200,000net patient accounts receivable$215,600supplies$87,655 total current assets$608,992property and equipment$2,250,000less accumulated depreciation$356,000net property and equipment$1,894,000total assets$2,502,992liabilities and shareholders' equitycurrent liabilities: accounts payable$72,250accrued expenses$192,900notes payable$100,000current portion of long-term debt$80,000 total current liabilities$445,150long-term debt$1,700,000shareholders' equity: common stock, $10 par value$100,000retained earnings$257,842 total shareholders' equity$357,842total liabilities and shareholders' equity$2,502,992a. perform a du pont analysis on green valley. assume that the industry average ratios are as follows: total margin3.5%total asset turnover1.5equity multiplier2.5return on equity (roe)13.1%b. calculate and interpret the following ratios: industry averagereturn on assets (roa)5.2%current ratio2.0days cash on hand22 daysaverage collection period19 daysdebt ratio71%debt-to-equity ratio2.5times interest earned (tie) ratio2.6fixed asset turnover ratio1.4c. assume that there are 10,000 shares of green valley's stock outstanding and that some recently sold for $45 per share. - what is the firm's price / earnings ratio? - what is its market / book ratio?

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