Analysis and Critical Thinking #4 You are the manager of the Blood Drawing (Phlebotomy) Department for Outpatients at the Mercer County Hospital. Mercer County Hospital is a 400-bed hospital that serves a small town in Ohio and the surrounding rural areas. It is the time of the year when the Hospital Administrator has asked all the Departmental Managers to prepare a Revenue and Expense Budget for 2025. You schedule a meeting with your two assistant managers. In preparation for the meeting, you review the final data presented below, from the previous three years. Revenues Chart A-This chart reflects the Revenues for three years for the whole hospital, both from inpatient services and outpatient services. In other words, the amount of money that was billed and received by the hospital. Patient Services 2022 2021 2023 Revenue $$ Inpatient Net of 52,240,653 53,286,192 54,125,200 Allowances Outpatient Net of 22,742,147 22,147,554 22,679,421 Allowances Total 74,982,800 75,433,746 76,804,621 NET INCOME FROM OPERATIONS Chart B-This chart reflects the net income of the whole hospital for the three years, in other words, the net "profit" after the expenses were paid. Net Income 2021 2,385,272 2022 1,249,230 2023 1,101,921 Expenses Chart C-This chart reflects the expense incurred in your department for the three years. Expenses in $$ 2021 2022 2023 Salaries and Wages 452,320 456,675 460,905 Fringe Benefits* 135,696 141,569 146,541 Supplies 6,579 6,700 8,200 Equipment 1,039 2,546 2.956 Depreciation* 3,000 2,798 2,234 Amortization* 9,000 7,879 7,500 Other 10,102 10,974 11,943 Total 617,736 629,141 640,279 *Fringe Benefits are the benefits that you provide for your staff e.g. health insurance, vacation days etc. *Depreciation-cost of tangible property over the life of the property Amortization ---The amount of money paid in payments over a period of time, (similar to paying for your car over time) When you meet with the managers, you will need to present your thoughts to them so that you all can discuss the issues and come up with a budget. In consideration of the meeting: Describe the pattern that you see in the Revenues that the hospital has received over the past three years (Chart A). In other words, what have the revenue numbers been and where are they trending? Describe the pattern in the Net Income from Operation for the hospital over the past three years (Chart B). In other words, what has it been and where it is trending? Describe the pattern in the Expenses for your department over the past three years (Chart C). In other words what have they been and where are they trending? Describe the items of your departmental expenses over the last three years for which you can identify significant changes in expenditure over the last three years. Describe the items that you believe will, based on the last three years, need to be considered for a change in your projected budget for your department. In other words, based on what you see of the past three years which area would you need to budget more or decrease the amount budgeted. Describe the reasons for your conclusions.
Analysis and Critical Thinking #4 You are the manager of the Blood Drawing (Phlebotomy) Department for Outpatients at the Mercer County Hospital. Mercer County Hospital is a 400-bed hospital that serves a small town in Ohio and the surrounding rural areas. It is the time of the year when the Hospital Administrator has asked all the Departmental Managers to prepare a Revenue and Expense Budget for 2025. You schedule a meeting with your two assistant managers. In preparation for the meeting, you review the final data presented below, from the previous three years. Revenues Chart A-This chart reflects the Revenues for three years for the whole hospital, both from inpatient services and outpatient services. In other words, the amount of money that was billed and received by the hospital. Patient Services 2022 2021 2023 Revenue $$ Inpatient Net of 52,240,653 53,286,192 54,125,200 Allowances Outpatient Net of 22,742,147 22,147,554 22,679,421 Allowances Total 74,982,800 75,433,746 76,804,621 NET INCOME FROM OPERATIONS Chart B-This chart reflects the net income of the whole hospital for the three years, in other words, the net "profit" after the expenses were paid. Net Income 2021 2,385,272 2022 1,249,230 2023 1,101,921 Expenses Chart C-This chart reflects the expense incurred in your department for the three years. Expenses in $$ 2021 2022 2023 Salaries and Wages 452,320 456,675 460,905 Fringe Benefits* 135,696 141,569 146,541 Supplies 6,579 6,700 8,200 Equipment 1,039 2,546 2.956 Depreciation* 3,000 2,798 2,234 Amortization* 9,000 7,879 7,500 Other 10,102 10,974 11,943 Total 617,736 629,141 640,279 *Fringe Benefits are the benefits that you provide for your staff e.g. health insurance, vacation days etc. *Depreciation-cost of tangible property over the life of the property Amortization ---The amount of money paid in payments over a period of time, (similar to paying for your car over time) When you meet with the managers, you will need to present your thoughts to them so that you all can discuss the issues and come up with a budget. In consideration of the meeting: Describe the pattern that you see in the Revenues that the hospital has received over the past three years (Chart A). In other words, what have the revenue numbers been and where are they trending? Describe the pattern in the Net Income from Operation for the hospital over the past three years (Chart B). In other words, what has it been and where it is trending? Describe the pattern in the Expenses for your department over the past three years (Chart C). In other words what have they been and where are they trending? Describe the items of your departmental expenses over the last three years for which you can identify significant changes in expenditure over the last three years. Describe the items that you believe will, based on the last three years, need to be considered for a change in your projected budget for your department. In other words, based on what you see of the past three years which area would you need to budget more or decrease the amount budgeted. Describe the reasons for your conclusions.
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
Transcribed Image Text:Analysis and Critical Thinking #4
You are the manager of the Blood Drawing (Phlebotomy) Department for Outpatients at the Mercer
County Hospital. Mercer County Hospital is a 400-bed hospital that serves a small town in Ohio and the
surrounding rural areas.
It is the time of the year when the Hospital Administrator has asked all the Departmental Managers to
prepare a Revenue and Expense Budget for 2025. You schedule a meeting with your two assistant
managers. In preparation for the meeting, you review the final data presented below, from the previous
three years.
Revenues Chart A-This chart reflects the Revenues for three years for the whole hospital, both
from inpatient services and outpatient services. In other words, the amount of money that was billed
and received by the hospital.
Patient Services
2022
2021
2023
Revenue $$
Inpatient Net of
52,240,653
53,286,192
54,125,200
Allowances
Outpatient Net of
22,742,147
22,147,554
22,679,421
Allowances
Total
74,982,800
75,433,746
76,804,621
NET INCOME FROM OPERATIONS Chart B-This chart reflects the net income of the whole hospital
for the three years, in other words, the net "profit" after the expenses were paid.
Net Income
2021
2,385,272
2022
1,249,230
2023
1,101,921
Expenses Chart C-This chart reflects the expense incurred in your department for the three
years.
Expenses in $$
2021
2022
2023
Salaries and Wages
452,320
456,675
460,905
Fringe Benefits*
135,696
141,569
146,541
Supplies
6,579
6,700
8,200
Equipment
1,039
2,546
2.956
Depreciation*
3,000
2,798
2,234
Amortization*
9,000
7,879
7,500
Other
10,102
10,974
11,943
Total
617,736
629,141
640,279
*Fringe Benefits are the benefits that you provide for your staff e.g. health insurance, vacation
days etc.
*Depreciation-cost of tangible property over the life of the property
Amortization ---The amount of money paid in payments over a period of time, (similar to
paying for your car over time)

Transcribed Image Text:When you meet with the managers, you will need to present your thoughts to them so that you all can
discuss the issues and come up with a budget.
In consideration of the meeting:
Describe the pattern that you see in the Revenues that the hospital has received over the past
three years (Chart A). In other words, what have the revenue numbers been and where are they
trending?
Describe the pattern in the Net Income from Operation for the hospital over the past three years
(Chart B). In other words, what has it been and where it is trending?
Describe the pattern in the Expenses for your department over the past three years (Chart C). In
other words what have they been and where are they trending?
Describe the items of your departmental expenses over the last three years for which you can
identify significant changes in expenditure over the last three years.
Describe the items that you believe will, based on the last three years, need to be considered for
a change in your projected budget for your department. In other words, based on what you see
of the past three years which area would you need to budget more or decrease the amount
budgeted. Describe the reasons for your conclusions.
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