You are a staff member in the finance department at Nouveau Health, whose sole responsibility is to advance the success of the organization through assisting in planning, forecasting, and finance management.

You are a staff member in the finance department at Nouveau Health, whose sole responsibility is to advance the success of the organization through assisting in planning, forecasting, and finance management. Complete the following: Prepare next year’s financial plan and operational budget. The CEO has asked that you expand that budget and provide a finalized budget that will take into account the new services offered. The CEO has stated that there is $3 million that you can incorporate in to the budget for additional staffing, services, maintenance, and so forth.

Below is the next year’s budget.

What is next year’s financial plan?

use reference to support plan

KRONA HOSPITAL OPERATING BUDGET FOR 20XX  

Revenues Next Year’s Budget  

  Inpatient $ 25,000,000 $27,500,000.00  

  Outpatient 15,000,000 17,250,000.00  

  Emergency Room 10,000,000 $10,000,000.00  

  Laboratory 5,000,000 $5,000,000.00  

  Pharmacy 1,500,000 $1,575,000  

  Home Health and Hospice 1,500,000 $1,725,000  

  Ambulance Services 950,000 $950,000  

  Substance Abuse 250,000 $250,000  

  Other 850,000 $850,000  

Subtotal $ 60,050,000 $65,100,000  

  Less Chartiy Care 18,000,000 $18,000,000  

Net Revenues $ 42,050,000 $47,100,000  

Expenses  

  Payroll (including nursing salaries) $ 12,500,000 $13,750,000  

  Benefits 3,000,000 $3,300,000  

  Contract Labor 100,000 $100,000  

  Insurance 300,000 $300,000  

  General Services (laundary, security, etc) 3,000,000 $3,000,000  

  Depreciation 1,500,000 $1,500,000  

  Interest Expense 300,000 $300,000  

  Professional Services 10,000,000 $10,000,000  

Total Operating Expenses $ 30,700,000 $32,250,000  

Net Income $ 11,350,000 $14,850,000