Alternaitve Working Capital

Alternative Working Capital January 10, 2011 University of Phoenix Rhonda Taylor Health get by is the single largest application in the U.S. today. A lot of hospitals in the U.S. argon financially vulnerable due to funding cutbacks, lack of Medicaid reimbursements and cuts in Medicare payments (Healthcare monetary Accounting Simulation). Elijah Heart Center is a 140-bed cardiac care hospital located in New York. EHCs patient role volumes and revenues are growing but profit is dropping. The board has leased a financial consulting faithful to help turnaround hospital. EHC is in the process of facing a working capital deficit. If an emergency, the hospital might not have enough money to shop itself. By reducing staff benefits and reducing staff function along with a loan the working capital shortfall problem at EHC can be solved. Most health care organizations are going to experience a short need for funds. For example, Elijah Heart Center is in the process of a working capital shortfall. The need for funds is usually a result of lack of disbursement of cash or an surprising business event. EHC patient volume and revenue is growing at a fast pace but profit dropping. mercantile chamfers are the predominant sources of short-term loans, but other sources are also uncommitted (Cleverly & Cameron, 2007).

Several other sources are available and used by health care organizations for short-term financing. EHC has jump off sources of financing includes: single payment loan, revolving credence agreements, term loans, parenthood of credit and letters of credit. The single-payment loan is an agreement that permits a firm to borrow up to a specified limit during a defined loan period (Cleverly & Cameron, 2007). For example, a commercial bank may grant a $1 million demarcation of credit to a hospital during a specific year. The hospital then can borrow up to that amount in that year. A revolving credit is similar to a line of credit except specific time period, ranging from between two and seven... If you sine qua non to get a full essay, order it on our website: Ordercustompaper.com

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