What would be the firms new receivables balance

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Fargo Memorial Hospital has annual patient service revenue of $14,400,000. It has two major third party payers, and some if its patients are self-payers. The hospital's patient accounts managers estimates that 10 percent of the hospital's paying patients (its self-payers) pay on Day 30, 60 percent pay on Day 60 (Payer A), and 30 percent pay on Day 90 (Payer B). (Five percent of total billings ends up as bad-debt losses, but that is not relevant to this problem) What would be the firm's new receivables balance if a newly proposed electronic claims system resulted in collecting from third-party payers in 45 and 75 days, instead of in 60 and 90 days?

Reference no: EM13335442

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