Pacific Healthcare is an investor-owned hospital chain that owns and operates nine hospitals in Washington, Oregon, and Northern California. Marcia Long, a recent graduate of a prominent health administration program, has just been hired by Washington Medical Center, Pacific’s largest hospital. Like all new management personnel, Marcia must undergo three months of intensive indoctrination at the system level before joining the hospital. Marcia began her indoctrination in January 2018. Her first assignment at Pacific was to review its latest annual report. This was a stroke of luck for Marcia because her father owned several bonds issued by Pacific, and she was especially interested in whether her father had made a good invest- ment. To glean more information about the bonds, she examined Note E to Pacific’s consolidated financial statements, which lists the company’s long-term debt obligations, including its first mortgage bonds, installment contracts, and term loans. Exhibit 13.1 contains information on four of the first-mortgage bonds listed in Pacific’s annual report. All four bonds pay interest semiannually. (For more information on bond ratings, see Standard & Poor’s website at www.standardandpoors.com or the Moody’s Investors Service website at www.moodys.com.) Pacific’s chief financial officer, Hugo Welsh, found out about Marcia’s interest in the firm’s debt financing. “Because you are so interested in our financial structure,” he said, “I want you to do the bond valuation and make a presentation to our executive committee.” Hugo then asked Marcia to perform the calculations required to complete exhibit 13.2 and to think about some of the questions that members of the committee might ask her about the numbers APA 7th Edition (American Psychological Assoc.) George Pink. (2018). Gapenski’s Cases in Healthcare Finance, Sixth Edition: Vol. Sixth edition. Health Administration Press. 
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