Consider the following financial statements for BestCare HMO
17.four Think about the next monetary statements for BestCare HMO, a not-for-profit managed care plan:BestCare HMOStatement of Operations and Change in Internet AssetsYear Ended June 30, 2011(in hundreds)Income:Premiums earned $26,682Coinsurance $1,689Curiosity and different earnings $242Complete income $28,613Bills:Salaries and advantages $15,154Medical provides and medicines $7,507Insurance coverage $three,963Provision for unhealthy money owed $19Depreciation $367Curiosity $385Complete bills $27,395Internet earnings $1,218Internet belongings, starting of 12 months $900Internet belongings, finish of 12 months $2,118BestCare HMOBalance SheetYear Ended June 30, 2011(in hundreds)AssetsCash and money equivalents $2,737Internet premiums receivable $821Provides $387Complete present belongings $three,945Internet property and tools $5,924Complete belongings $9,869Liabilities and Internet AssetsAccounts payable - medical companies $2,145Accrued bills $929Notes payable $141Present portion of long-term debt $241Complete present liabilities $three,456Lengthy-term debt $four,295Complete liabilities $7,751Internet belongings - unrestricted (fairness) $2,118Complete liabilities and web belongings $9,869a. Carry out a Du Pont evaluation on BestCare. Assume that the business common ratios are as follows:Complete margin three.8percentTotal asset turnover 2.1Equity multiplier three.2Return on fairness (ROE) 25.5percentb. Calculate and interpret the next ratios for BestCare:Business averageReturn on belongings (ROA) eight.0percentCurrent ratio 1.3Days money readily available 41 daysAverage assortment interval 7 daysDebt ratio 69%Debt-to-equity ratio 2.2Times curiosity earned (TIE) ratio 2.8Fixed asset turnover ratio 5.2