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| List of Tables, Figures, and Exhibits | |
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| Preface | |
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| TheAuthors | |
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| Acknowledgments | |
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| The Context Of Health Care Financial Management | |
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| Introduction | |
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| Rising Health Care Costs | |
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| The Payment System | |
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| Technology 6 | |
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| The Aging Population | |
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| Prescription Drug Costs and Medicare Part D | |
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| Chronic Diseases | |
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| Compliance and Litigation | |
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| The Uninsured | |
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| Efforts to Control Costs | |
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| Efforts by Payors to Control Health Care Costs | |
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| DRGs | |
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| Capitation | |
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| Global Payments | |
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| APCs | |
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| Pay-for-Performance | |
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| Cutting Delivery Costs | |
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| Shift to Outpatient Services | |
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| Cost Accounting Systems | |
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| Information Services Technology | |
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| Mergers and Acquisitions | |
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| Reengineering/Redesign | |
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| Alternative Forms of Care | |
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| Retail Health Care | |
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| Medical Tourism | |
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| Medical Home | |
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| Cost Control Issues with Ethical Overtones | |
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| Summary | |
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| Key Terms | |
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| Questions and Problems | |
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| Health Care Financial Statements | |
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| Introduction | |
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| The Balance Sheet | |
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| Assets | |
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| Current Assets | |
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| Noncurrent Assets | |
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| Liabilities | |
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| Current Liabilities | |
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| Noncurrent Liabilities | |
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| Net Assets | |
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| Stockholders' Equity | |
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| Notes to Financial Statements | |
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| The Statement of Operations | |
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| Unrestricted Revenues, Gains, and Other Support | |
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| Net Patient Service Revenues | |
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| Premium Revenues | |
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| Other Revenues | |
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| Net Assets Released from Restriction | |
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| Expenses | |
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| Depreciation and Amortization | |
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| Interest | |
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| Provision for Bad Debts | |
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| Other Expenses | |
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| Operating Income | |
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| Other Income | |
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| Excess of Revenues over Expenses | |
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| Below the Line Items | |
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| Change in Net Unrealized Gains and Losses on Other | |
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| than Trading Securities | |
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| Increases in Long-Lived Unrestricted Net Assets | |
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| Transfers to Parent | |
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| Extraordinary Items | |
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| Increase in Unrestricted Net Assets | |
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| The Statement of Changes in Net Assets | |
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| Changes in Unrestricted Net Assets | |
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| Changes in Temporarily Restricted Net Assets | |
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| Changes in Permanently Restricted Net Assets | |
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| The Statement of Cash Flows | |
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| Cash Flows from Operating Activities | |
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| Cash Flows from Investing Activities | |
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| Cash Flows from Financing Activities | |
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| Cash and Cash Equivalents at the End of the Year | |
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| Summary | |
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| Key Terms | |
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| Key Equations | |
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| Questions and Problems | |
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| Financial Statements for Sample Not-for-Profi t Hospital and For-Profi t Hospital and Notes to Financial Statement | |
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| Principles And Practices Of Health Care Accounting | |
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| Introduction | |
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| The Books | |
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| Cash and Accrual Bases of Accounting | |
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| Cash Basis of Accounting | |
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| Accrual Basis of Accounting | |
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| An Example of the Effects of Cash Flows on Profit | |
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| Reporting Under Cash and Accrual Accounting | |
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| Recording Transactions | |
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| Rules for Recording Transactions | |
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| The Recording Process | |
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| Developing the Financial Statements | |
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| The Balance Sheet | |
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| Assets | |
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| Liabilities | |
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| Net Assets | |
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| The Statement of Operations | |
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| Unrestricted Revenues, Gains, and Other Support | |
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| Operating Expenses | |
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| Operating Income and Excess of Revenues over Expenses | |
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| Increase in Unrestricted Net Assets | |
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| Statement of Changes in Net Assets | |
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| Statement of Cash Flows | |
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| Summary | |
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| Key Terms | |
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| Questions and Problems | |
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| Financial Statement Analysis | |
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| Introduction | |
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| Horizontal Analysis | |
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| Trend Analysis | |
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| Vertical (Common-Size) Analysis | |
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| Ratio Analysis | |
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| Categories of Ratios | |
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| Key Points to Consider When Using and Interpreting Ratios | |
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| Liquidity Ratios | |
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| Current Ratio | |
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| Quick Ratio | |
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| Acid-Test Ratio | |
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| Days in Accounts Receivable | |
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| Days Cash on Hand | |
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| Average Payment Period | |
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| Liquidity Summary | |
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| Revenue, Expense, and Profi tability Ratios | |
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| Operating Revenue per Adjusted Discharge | |
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| Operating Expense per Adjusted Discharge | |
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| Salary and Benefi t Expense as a Percentage of Total Operating Expense | |
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| Operating Margin | |
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| Nonoperating-Revenue Ratio | |
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| Return on Total Assets | |
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| Return on Net Assets | |
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| Revenue, Expense, and Profitability Summary | |
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| Activity Ratios | |
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| Total Asset Turnover | |
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| Fixed Asset Turnover | |
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| Age-of-Plant Ratio | |
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| Activity Summary | |
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| Capital Structure Ratios | |
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| Long-Term Debt to Net Assets | |
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| Net Assets to Total Assets | |
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| Times Interest Earned | |
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| Debt Service Coverage | |
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| Capital Structure Summary | |
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| Summary of Newport Hospital's Ratios | |
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| Summary | |
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| Key Terms | |
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| Key Equations | |
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| Questions and Problems | |
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| Working Capital Management | |
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| Introduction | |
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| The Working Capital Cycle | |
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| Working Capital Management Strategies | |
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| Asset Mix Strategy | |
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| Financing Mix Strategy | |
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| Cash Management | |
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| Sources of Temporary Cash | |
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| Bank Loans | |
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| Lines of Credit | |
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| Commitment Fees | |
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| Compensating Balance | |
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| Transaction Notes | |
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| Trade Credit or Payables | |
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| Revenue Cycle Management | |
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| Scheduling or Preregistration | |
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| Registration | |
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| Charge Capture | |
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| Coding | |
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| Billing | |
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| Payment | |
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| Collecting Cash Payments | |
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| Decentralized Collection Centers and Concentration Banking | |
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| Lockboxes | |
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| Wire Transfers | |
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| Investing Cash on a Short-Term Basis | |
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| Treasury Bills (T-bills) | |
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| Negotiable Certifi cates of Deposit | |
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| Commercial Paper | |
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| Money Market Mutual Funds | |
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| Forecasting Cash Surpluses and Defi cits-The Cash Budget | |
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| Cash Inflows | |
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| Cash Outflows | |
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| Ending Cash Balance | |
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| Accounts Receivable Management | |
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| Methods to Monitor Accounts Receivable | |
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| Methods to Finance Accounts Receivable | |
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| Factoring | |
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| Pledging Receivables as Collateral | |
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| Methods to Monitor Revenue Cycle Performance | |
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| Laws and Regulation for Billing Compliance | |
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| Health Insurance Portability and Accountability Act | |
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| Summary | |
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| Key Terms | |
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| Key Equations | |
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| Questions and Problems | |
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| The Time Value Of Money | |
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| Introduction | |
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| Future Value of a Dollar Invested Today | |
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| Using a Formula to Calculate Future Value | |
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| Using Tables to Compute Future Value | |
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| Using a Spreadsheet to Calculate Future Value | |
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| Present Value of an Amount to Be Received in the Future | |
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| Using a Formula to Calculate Present Value | |
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| Using Tables to Compute Present Value | |
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| Using a Spreadsheet to Calculate Present Value | |
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| Annuities | |
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| Future Value of an Ordinary Annuity | |
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| Using Tables to Calculate the Future Value of an Ordinary Annuity | |
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| Using a Spreadsheet to Calculate the Future Value of an Ordinary Annuity | |
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| Future Value of an Annuity Due | |
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| Present Value of an Ordinary Annuity | |
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| Using Tables to Calculate the Present Value of an ordinary Annuity | |
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| Using a Spreadsheet to Calculate the Present Value | |
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| Present Value of an Annuity Due | |
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| Special Situations to Calculate Future or Present Value and Other Excel Functions | |
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| What If the Interest Rate Is Not Expressed as an Annual Rate? | |
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| How to Compute Periodic Loan Payments Using Excel | |
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| How to Calculate the Compounded Growth Rate | |
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| How to Calculate the Present Value of Perpetual Annuities | |
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| How to Solve for the Interest Rate of a Loan with Fixed | |
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| Loan Payments | |
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| Summary | |
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| Key Terms | |
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| Key Formulas | |
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| Questions and Problems | |
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| Future and Present Value Tables | |
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| The Investment Decision | |
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| Introduction | |
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| Objectives of Capital Investment Analysis | |
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| Nonfinancial Benefits | |
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| Financial Returns | |
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| Ability to Attract Funds in the Future | |
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| Analytic Methods | |
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| Payback Method | |
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| Analysis | |
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| Strengths and Weaknesses of the Payback Method | |
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| Net Present Value | |
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| Using the Small Hospital as an Example of Net Present Value Analysis | |
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| Decision Rules Regarding NPV | |
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| Using Spreadsheets to Calculate NPV | |
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| Strengths and Weaknesses of the NPV Method | |
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| Internal Rate of Return | |
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| Equal Cash Flows | |
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| Unequal Cash Flows | |
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| Decision Rules with IRR | |
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| Strengths and Weaknesses of IRR Analysis | |
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| Using an NPV Analysis for a Replacement Decision | |
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| Illustrative Example | |
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| Solution | |
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| Summary | |
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| Key Terms | |
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| Key Equations | |
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| Questions and Problems | |
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| Technical Concerns Regarding Net Present Value | |