As a health care manager and department head, you are responsible for reporting on the status of your department and developing plans for the future. Using financial ratios will provide you with the support for your decisions.
Choose one of these ratios to discuss in detail:
*Current ratio
*Debt to asset ratio
*Profit margin ratio
*Return on total assets ratio
*Working capital ratio
Respond to the following:
If you are calculating your chosen ratio, what are you trying to determine about your company’s financial position? What would you do with the results?
How would a health care leadership team use the financial ratio? Provide an example.
Assuming your ratio shows a weakness in the company’s performance, what specific action would you recommend to leadership to improve the position?
How would you use 1 of the financial ratios in your personal finances or current profession? Give a specific example.