great forks hospital reported net income for 2011 of $2.4 million on total revenue of $30 million. Depreciation expense totaled $1 million
a. what were total expenses for 2011?
b. what were total cash expenses for 2011? (Hint: assume that all expenses, except depreciation, were cash expenses.)
c. what was the hospital’s 2011 cash flow?
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To answer the questions, we need to understand and calculate the following:
a. Total expenses = Net income + Depreciation expense
b. Total cash expenses = Total expenses - Depreciation expense
c. Cash flow = Net income + Depreciation expense
Now let's calculate the answers step by step:
a. Total expenses for 2011:
Total expenses = Net income + Depreciation expense
Total expenses = $2.4 million + $1 million
Total expenses = $3.4 million
b. Total cash expenses for 2011:
Total cash expenses = Total expenses - Depreciation expense
Total cash expenses = $3.4 million - $1 million
Total cash expenses = $2.4 million
c. Cash flow for 2011:
Cash flow = Net income + Depreciation expense
Cash flow = $2.4 million + $1 million
Cash flow = $3.4 million
Therefore, the answers are:
a. Total expenses for 2011: $3.4 million
b. Total cash expenses for 2011: $2.4 million
c. Cash flow for 2011: $3.4 million