Description
This assignment is a project to create the financial projection portion of a business plan that is based on a hypothetical situation at John Muir Medical Center. It is to include pro forma financial statements, including income statement, cash projection schedule, and balance sheet. Uses appropriate accounting method for industry and form of business. It provides realistic potential sales and earnings figures.
Ambulatory Surgery Center (ASC)
Background:
You are a project manager for a 300-bed community hospital with a 100-physician medical group consisting of primary care and specialty physicians including 20 surgeons of various specialties. Included in this are four well known and respected orthopedic surgeons who contribute significantly to the hospital’s surgery volumes. Senior leadership of the hospital has asked you to put together a proposal for the addition of an outpatient surgery center to be constructed in a new space attached to the hospital.
Important factors for consideration in your proposal include:
Patient flow
Number of rooms needed
Operating room (OR) equipment
Sterilization equipment
Office equipment
Construction factors: contractor selection, timelines, permitting, licensing, architecture and interior design, etc.
Volumes lost in main OR versus volume gain from outpatient environment and increased capacity
Staffing
oMake the following assumptions per operating room:
§One RN
§One scrub tech
§Four pre-op RNs
§Four post-op RNs
§Two registration clerks
§One custodian
§Two sterilization clerks
Registration process
Pre-op process
Post-op process
Coding/billing process
Physician space (Changing rooms, workspace for paper work)
Staff space (Changing rooms, break room)
Effects of political aspects of meeting physician needs on both the surgery center’s performance and that of the main OR in the hospital. Also, any that may occur between surgical specialists.
Financial impacts of an ASC
Trend analysis: are ambulatory surgery centers a growing or diminishing trend?
Typical competition of an ASC
Should it be attached to the hospital, etc?
Marketing – who are major audiences?
Training
Certification
**This is what has been created so far, but feel free to edit and explain as you see fit:
The profit and loss spreadsheet is based upon an average cost of approximately $5,500, and a cost of services estimated at approximately $4,125. Financial projections will be based upon a typical Ambulatory Surgery Center Schedule of Mondays through Fridays, with an average of 5.5 surgeries per day. A projected growth in revenue is estimated at approximately 5% a year over the next three years, assuming a growth in operations conducted and range of operations serviced.
For staffing assumptions, eight registered nurses are expected to work full-time at the facility, with the possibility of hiring more staff as needed for potential growth. Registered nurses average at approximately $35 for the surrounding area. Assumptions for other staff (surgeons, clerks, custodians, scrub techs, etc), will be based upon the average hourly rate for the position and area.
Year 1 | Year 2 | Year 3 | |
Sales | $7,260,000 | $7,623,000 | $8,004,150 |
Costs/Goods Sold | $5,445,000 | $5,717,250 | $6,003,113 |
GROSS PROFIT | $1,815,000 | $1,905,750 | $2,001,037 |
Salary (Office & Overhead) | $1,079,656 | $1,079,656 | $1,079,656 |
Payroll (taxes, etc.) | $43,186 | $43,186 | $43,186 |
Repairs & Maintenance | $3,125 | $3,125 | $3,125 |
Advertising | $1,200 | $1,000 | $1,000 |
Rent | $24,750 | $24,750 | $24,750 |
Other expenses | $12,000 | $5,200 | $5,200 |
TOTAL EXPENSES | $1,163,917 | $1,156,917 | $1,156,917 |
NET PROFIT (before taxes) | $651,083 | $748,833 | $844,120 |
NET PROFIT (after tax) | $651,083 | $748,833 | $844,120 |
ADJUSTED TO RETAINED | $651,083 | $748,833 | $844,120 |
Explanation & Answer
Please let me know if there is anything needs to be changed or added. I will be also appreciated that you can let me know if there is any problem or you have not received the workGood luck in your study and if you need any further help in your assignments, please let me knowCan you please confirm if you have received the work? Once again, thanks for allowing me to help youRMESSAGE TO STUDYPOOLNO OUTLINE IS NEEDED
Schedule 1
Required Start-Up Funds
Estimated Monthly Expenses
Column 1
Column 2
Number of Months
Your Estimate of Monthly
of Cash Required
Expenses Based on Sales
to Cover Expenses*
of $_________ Per Year
Item
Salary of Owner-Manager
All Other Salaries and Wages
Rent
Advertising
Delivery Expense/Transportation
Goods
Telephone, Fax, Internet Service
Other Utilities
Insurance
Taxes Including Employment Insurance
Interest
Maintenance
Legal and Other Professional Fees
Miscellaneous
Column 3
Cash Required To Start
Business (Column 1 X
Column 2)*
$75,000
3.00
$225,000
$125,000
3.00
$375,000
$45,031
3.00
$135,092
$83
3.00
$250
$3,500
3.00
$10,500
$488,390
$0
$433
$0
3.00
3.00
3.00
3.00
$1,465,170
$0
$1,300
$0
$3,599
3.00
$10,797
$0
3.00
$0
$260
3.00
$781
$0
$0
3.00
3.00
$0
$0
Total Cash Requirements for Monthly Recurring Expenses: (A)
$2,223,890
Start-up Costs You Only Have
to Pay Once
Cash Required to
Start Business
Capital Costs
Fixtures and Equipment
Decorating and Remodelling
Installation of Fixtures and Equipment
Starting Inventory
$500,000
$15,000
$20,000
$234,600
Deposits with Public Utilities
Legal and Other Professional Fees
Licenses and Permits
Advertising and Promotion for Opening
Accounts Receivable
Cash
Miscellaneous
$0
$0
$0
$1,000
$0
$0
$23,000
Soft Costs
Total One-Time Cash Requirements: (B)
$793,600
Total Estimated Cash Required to Start Business: (A) + (B)
$3,017,490
* You Will Have to Decide For Your Particular Business How Many Months You Expect Your Expenses to
Exceed Your Revenue So That You Will Have a Shortfall of Cash. This Should Somewhat Overestimate
Your Overall Cash Requirements and Provide You With a Safety Cushion In Case Sales Don't Materialize
As Rapidly As You Expected.
Year 1
Year 2
Sales
7523000.00 $8,004,150
Costs/Goods Sold
5717250.00 $6,003,113
GROSS PROFIT
1905750.00 $2,001,037
Salary (Office &
Overhead)
Payroll (taxes,
etc.)
Repairs &
Maintenance
Advertising
Rent
Other expenses
TOTAL
EXPENSES
NET PROFIT
(before taxes)
NET PROFIT
(after tax)
ADJUSTED TO
RETAINED
1079656.00 $1,079,656
43186.00 $43,186
3125.00 $3,125
1000.00 $1,000
23750.00 $24,750
5200.00 $5,200
1156917.00 $1,156,917
748833.00 $844,120
748833.00 $844,120
748833.00 $844,120
Year 3
800150.00
4161575.00
346797.9167
28900
6004113
5860681.50
488390.125
40699
20001
962875.50
80239.625
6687
1079
540367.50
45030.625
3753
43186
43186.00
3598.833333
300
3125
3125.00
260.4166667
1000
1000.00
83.33333333
7
24750
24250.00
2020.833333
168
5200
5200.00
433.3333333
36
1146917
1151917.00
95993.08333
7999
844120
796476.50
66373.04167
5531
844120
796476.50
66373.04167
5531
844120
796476.50
66373.04167
5531
22
SCHEDULE 2
Pro Forma Income Statement for
(Company) for the Year Ending (Date)
Month
1
1. Gross Sales
2. Less: Cash Discounts
A. NET SALES
Cost of Goods Sold:
3. Beginning Inventory
4. Plus: Net Purchases
5. Total Available for Sale
6. Less: Ending Inventory
626,917
0
$626,917
476,438
476,438
0
Month
2
626,917
0
$626,917
0
476,438
476,438
0
Month
3
626,917
0
$626,917
0
476,438
476,438
0
Month
4
626,917
0
$626,917
0
476,438
476,438
0
Month
5
626,917
0
$626,917
0
476,438
476,438
0
Month
6
626,917
0
$626,917
0
476,438
476,438
0
Month
7
626,917
0
$626,917
0
476,438
476,438
0
Month
8
626,917
0
$626,917
0
476,438
476,438
0
Month
9
626,917
0
$626,917
0
476,438
476,438
0
Month
10
626,917
0
$62...