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Healthcare Finance
The Role of Financial Statements
As a healthcare manager, daily management tasks include financial management. Financial management includes items such as labor cost, equipment cost, and a budget that controls the operations. Proper operations require planning and control. The budget is created using the basic financial information and accounting principles that an organization uses in its monthly, quarterly, and annual financial reports.
After learning the basics of financial statements, it is very important for a healthcare manager to understand the basic five areas of performance that set the financial plan for the organization. Define and provide an example of what the following mean:
- Short-term solvency
- Activity
- Financial leverage
- Profitability
- Value
Define the following terms, and explain why they are important in a healthcare organization:
- Current ratio
- Total asset turnover
- Debt ratio
- Profit margins
Give a detail explanation of the three types of opportunities for sharing a sound basis for diversification (think in terms of ways companies diversify)
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Calculate the break-even point, use additional, publicly available information to come to a decision with respect to market potential
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