HSMB 306 – Assignment #3- Summer, 2020
Refer to Sunset Hospital’s financial statements below for calculating the ratios in problems 1-6.

Sunset Hospital

Statement of Operations

For the Year Ended December 31, 2018

Sunset Hospital

Balance Sheet

As of December 31, 2018 (2017 omitted)

Revenues, Gains, Other Support

Assets

Current Assets

Cash and cash equivalents $

Net patient receivables

Total Current Assets

Properties and Equipment

Gross properties and equipment $ Less accumulated depreciation

Net Properties and Equipment 425,000

Total Assets $

Liabilities and Net Assets

Current Liabilities

Accounts Payable Salaries Payable

Total Current Liabilities

Notes Payable Unrestricted Net Assets

Total Liabilities and Net Assets $

Net patient service revenue

Other revenue

Total Revenue

Expenses

$

1,500,000

200,000

1,700,000

Nursing Services
Administrative Services
Depreciation 100,000

50,000

350,000

400,000

900,000 475,000

825,000

200,000 50,000 250,000

200,000 375,000 825,000

1,200,000 200,000

Other Expenses

Total Expenses

Operating Income

Investment Income

Excess of revenues over expenses 200,000

Increase in Unrestricted Net Assets $

50,000

1,550,000 150,000 50,000

200,000

1

1. What is Sunset Hospital’s operating margin?
2. What is Sunset Hospital’s days in accounts receivable?
3. What is Sunset Hospital’s long-term debt to net assets ratio?
4. What is Sunset Hospital’s age of plant?
5. What is Sunset Hospital’s fixed asset turnover ratio?
6. What is Sunset Hospital’s days cash on hand?

Qualcomm company

The purpose of the third part of the comprehensive project is to use resources available to obtain industry averages for commonly used ratios. Additionally, you will compare company ratio results to industry averages.

1. Obtain the four-digit primary SIC (Standard Industrial Classification) Code and industry title for your company. Record the primary SIC code and industry title at the top of the Ratio Analysis Worksheet.
2. Obtain industry averages for commonly used ratios in the current period. Industry average information is reported by industry title or SIC code.
3. Look up the following industry-average ratios:
   1. Current ratio
   2. Debt ratio
   3. Gross profit margin
   4. Times interest earned
   5. Accounts receivable turnover
   6. Inventory turnover
   7. Return on Sales
   8. Asset Turnover
   9. Return on Assets
   10. Financial Leverage
   11. Return on Equity

Note that some industry averages may not apply to your company.

Alternative to Industry Averages:

If you are not able to find the industry average for part 3 of your project, please consider the following:

Unfortunately, some of the websites where you can find industry averages will require you to pay for them. Instead of using industry average, calculate the same ratios for one of the competitors to the company you used in your project. That will give you the comparative information you need for Part 3 of the project. I believe this will help.

1. Write a 3-5 page report comparing the above ratios to industry averages. Discuss whether your company’s profitability, efficiency, liquidity, and solvency are better than, or worse than, its peers. The report should be well written with cover page, introduction, body of paper (with appropriate subheadings), conclusion, and reference page. References must be appropriately cited. Format: Double-spaced, one-inch margins, using a 12-point Times New Roman font.

Adding research to your memo is not difficult. Even though our HAPPY BUNNY ENERGY JUICE is mythical, the REAL research you add can be very helpful.

Up to this point of our class and your writing, I have wanted to hear only your opinion, your thoughts, your analysis. I have asked you to stay far away from research. (Many modern writers are too quick to add outside sources because research is now so easy to find.) This eagerness to add research has lead to a lack of personal opinion and a lack of analytical skills.

However, there are times in the business world when research WILL help you.

If you are going to start your own business in San Bernardino, think of all the helpful information you could find by doing some research: what specific areas are fastest growing, what is the local demographic, how have other businesses fared in this area, what expenses can you predict, what might the interest rates be in the future, what have the rates been in the past? There are hundreds of research options to help prepare you to open a business.

If you plan on getting financing for your business, many banks will require you to create a business plan. Inside this business plan, you might be expected to project costs and revenue. Your research will help you calculate this information. And, you will be expected to have added this research to the business report, which the bank will use to determine your loan.

Here is how you might add research to a business report:

According to the City of San Bernardino’s official website, “San Bernardino is offering significant tax incentives to small business owners. As a result, small businesses have seen a healthy increase in profit over the past 5 years – averaging a 23% increase in sales from 2014- 2019.”(ci.san-bernardino.ca.us)

Additionally, in a recent survey of businesses located in downtown and northern San Bernardino, 85% of business owners have noticed an “significant” increase in walk in customers during the past calender year. (thesun.newspaper.org)

In a recent interview, the Mayor of San Bernardino, Bradley Cooper, had this to say about the improving conditions for small businesses, “The negativity surrounding San Bernardino is gone. People are beginning to see the benefit of living, shopping, and going to school in San Bernardino. This new found optimism is creating a financial benefit felt throughout the city.” (smallbusinessnews.net)

This is how I want you to approach the research aspect of this assignment. Find three or four sources that help you make your case to the reader.

So, if you plan on selling Happy Bunny Energy Juice, you need to use research to convince the reader (your boss – the CEO) your plan is sound. The research you add is of course up to you, but I want it to be legitimate. Find actual sources that support your ideas that selling an energy drink/juice to kids is a good business decision.

Like this:

We know the demand for fruit juices is very high. The website Super Market Shelves claims the juice aisle at most local supermarket stock on average of 40-50 options for parents who want their kids to have the health benefits a fruit juice provides. I say we make Happy Bunny Energy Juice a more advanced option for parents who want all the health benefits of a fruit juice and the added benefit of Happy Bunny’s natural energy boost.

Yes, there are many options, but once we throw the Happy Bunny brand into the mix, our adult consumers who love our product, will be eager to share the benefits of our new energy juice with younger consumers. This will help us gain an edge over the competition and the Happy Bunny brand will become a major force in the lucrative fruit juice market.

(I made this up, but I would find this information and use it to help prove that the demand will lead to profit.)

Now, let’s say you are NOT going to sell Happy Bunny’s new product. You should use the same approach, but use the information to help YOUR argument:

We know the demand for fruit juices is very high. But, this demand has already flooded the market with so many choices, it is hard to distinguish one product from another. The website Super Market Shelves claims the juice aisle at most local supermarket stock on average of 40-50 options for parents who want their kids to have the health benefits a fruit juice provides.

Adding another option, even a great brand such as Happy Bunny, would be risky. We risk being swallowed by the huge number of options already available. Do we really want to do battle with established juice brands like Dole, Ocean Spray, Langers, and Del Monte? These brands have a foothold in this market that many companies have tried to break, and they have failed miserably, spending millions on the way.

I say we continue to make Happy Bunny Energy Drink a more advanced option for consenting adults who want all the benefits of a top-selling energy drink including Happy Bunny’s natural energy boost.

Now, what about sources?

How do I add the sources to my memo?

I want you to add the name of the website to your memo whenever you use source material. You can add it to the text: According to the website energydrinkinfo.org, “In 2016, 115 deaths have been linked to the consumption of energy drinks.”

– OR, you can add the website in parenthesis at the end of the information: “In 2016, 115 deaths have been linked to the consumption of energy drinks” (energydrinkinfo.org). The PERIOD goes outside the parenthesis and the name of the website is italicized.

Where do I find sources?

The library! Yeah, right. What decade is it? Yes, the library used to be the place that housed all research material. Now, your pocket has the material you need. Most research (not all) is found on-line. So, you can use your phone or other electronic resources to find research.

What kinds of sources should I use?

Well, what subject are you researching? If you are writing an academic paper about infectious viruses, you would NOT want to use The National Enquirer, right? But, if you are writing an academic paper about the impact the paparazzi has had on our opinions of celebrities, then the Enquirer might be a great place to find source material.

So, for this assignment, use legitimate, respected, reputable sources. Most newspapers, government sites, national magazines, and journals are fine. Consumer groups’ website are tricky, but most are effective. Use your own judgment and use quality sources. There is no shortage of sources, so you should have no trouble finding credible information.

How Many Sources Should I Use?

This is easy. The “rule of thumb” for most research assignments is: use, on average, one source per page. If you have a 10 page research paper, you should have approximately 10 sources. If you have a 25 page research paper, you should have about 25 sources. This is for future papers you will write.

What are we creating? A 2- 3 page memo. You should have a few sources, 3 or 4 is good. Obviously, 6-10 is way too many. But using 1 or 2 sources is probably too few.

FINALLY

Remember, I want YOUR IDEAS, YOUR OPINION, YOUR ANALYSIS. The quality of your writing is still the main focus of this assignment. The majority of your grade is based on the writing you create.

Research is designed to assist you as you make your points to the reader. So, do NOT begin this memo by doing research about the positives or negatives of selling energy drinks. Begin by writing down your ideas.

If you are in favor of selling Happy Bunny’s Energy Juice explain why this is a good business idea. If you are against selling this new product, explain why this is a good business idea.

Reflect on the assigned readings for the week. Identify what you thought was the most important concept(s), method(s), the term(s), and/or any other thing that you felt was worthy of your understanding.

Chapter 10: Environmental Regulation and Sustainability

Chapter 11: Contracts and Sales: Introduction, Formation, Consumer Protection, App. B and C.

Also, provide a graduate-level response to each of the following questions:

1. California passes regulations that address pesticides.  These regulations are much stricter on the use and production of pesticides than the federal regulations.  Is this permissible under current law?  What if California’s regulations are much less strict than the federal regulations?
2. Deceitful Dad promises to take Sammy Son to the store to purchase a video game over the weekend.  Deceitful Dad has promised to do this multiple times, and never follows through.  Sammy Son has had enough and writes contact between Deceitful Dad and Sammy Son.  Both parties sign the agreement and it is notarized.  Deceitful Dad, despite the contract, fails to follow through once again.  Can Sammy Son seek damages under the contract?  Why or why not?  Would the result be different if Sammy Son paid Deceitful Dad $15.00 to take him to the store?
3. Discuss the required elements of a valid contract analyzing when an agreement rises to the level of a legally enforceable contract and when it does not.

[Your initial post should be based upon the assigned reading for the week, so the textbook should be a source listed in your reference section and cited within the body of the text. Other sources are not required but feel free to use them if they aid in your discussion].

Explain some of the hurdles litigants have encountered when it comes to the Endangered Species Act and standing to bring a lawsuit.

Question I – Explain some of the hurdles litigants have encountered when it comes to the Endangered Species Act and standing to bring a lawsuit.

Question II – An illegal drug manufacturer and an illegal drug dealer enter into an oral contract in which the manufacturer will sell the drugs to the drug dealer for a set price.  The manufacturer changes his mind and sells his product to another dealer.  Could the dealer enforce the oral contract?  Why or why not?

Question III – A contract is made between two parties.  The terms of the contract are complete and unambiguous.  A dispute arises between the Parties.  Party A wants to pull out of the contract without penalty.  Party B argues that Party A’s proposed action is prohibited by the express terms of the contract.  Party A argues that the Parties verbally agreed to ignore that provision of the contract that would impose a penalty on Party A.  Which Party will prevail and why?