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Scenario
One year ago, Metropolitan Memorial expanded its operations into a rural community located approximated a hundred miles from its main facility. The clinic offers a wide array of outpatient services. As the Senior Accountant, you are reviewing the clinic’s operating budget from the previous year. You have been asked by the hospital’s chief administrator to create a new six-month operations budget for the clinic.
Operating-Budget.xlsx-see attached document
Instructions
Using an Excel spreadsheet, create a new six-month budget for the clinic that includes the following revenue and expense projections:
- The clinic’s revenue is projected to grow by approximately 3% as a result of a new managed care contract.
- The cost of expenses is expected to increase to 1.5%.
- The clinic will also be adding a new roof to the facility at a projected cost of $50,000.
Then prepare a memo for the chief administrator. The memo should include a review of the previous year’s budget, an analysis of the upcoming changes (figures above), and a discussion about the impacts that these changes will have on the budget for the upcoming year.
Rubric:
– Memo includes a complete and thorough review of the year’s budget with multiple examples or supporting details.
– Memo includes a comprehensive analysis of the proposed changes, incorporating the following figures: clinic revenue growth of approximately 3%, a result of the new managed care contract, expense cost increase of 1.5%, new roof for facility at $50,000
– Memo includes a clear and thorough discussion on the impacts that the changes will have on the budget for the upcoming year. Includes multiple examples or supporting details.
– Excel spreadsheet of six-month budget for the clinic with revenue and expense projections has no significant errors.
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