SEQ CHAPTER \H \R 1This Statement of Facts Is Presented

question 4

Multiple Choice

SEQ CHAPTER \h \r 1This statement of facts is presented for problems 22 and 23: The following data comes from Olde Towne Hospital's financial statements.Total revenues were $20 million.Total expenses were $18 million,consisting of patient care expenses - $13 million;administrative expenses - $2 million;depreciation - $2 million;and interest on long-term debt - $1 million.Principal payments on long-term debt were $1.5 million.
-What is Olde Towne's debt service coverage?

• A)0.8 times
• B)1.6 times
• C)2.0 times
• D)2.7 times

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Definitions:

Traditional Performance

The evaluation of an entity's performance based on historical financial metrics and objectives.

Short-term Financial

Refers to the aspect of finance that deals with assets and liabilities which are expected to be turned into cash or paid within a year.

Long-term Goal

An objective or aim that is planned to be achieved over an extended period, typically over a year, focusing on significant achievements for the future.

Integrated Performance

The comprehensive assessment of all aspects of performance, including financial, operational, and strategic dimensions, in an organization.