Assignment Exercise 10–1: Components of Balance Sheet and Statement of Net Income
Refer to the Metropolis Health System (MHS) Supplemental Information at the back of the Examples and Exercises section. Use the MHS comparative Balance Sheet, Statement of Revenue and Expenses, and Statement of Fund Balance for this assignment (above). I’ve attached the chart for you to use. Fill it in completely.
Identify the following MHS Balance Sheet components. List the name of each component and its amount(s) from the appropriate MHS financial statement.
• Current Liabilities
• Total Assets
• Income from Operations
• Accumulated Depreciation
• Total Operating Revenue
• Current Portion of Long-Term Debt
• Interest Income
CHAPTER 12 Questions
Assignment Exercise 12–1: Unadjusted Rate of Return
Metropolis Health Systems’ Laboratory Director expects to purchase a new piece of equipment. The assumptions for the transaction are as follows:
• Average annual net income = $70,000
• Original investment amount = $410,000
• Unrecovered asset cost at the end of useful life (salvage value) = $41,000
1. Compute the Unadjusted Rate of Return using the original investment amount.
2. Compute the Unadjusted Rate of Return using the average investment method.