Dynatech Healthcare, a group practice clinic with 10
physicians, had the following income in 2017:
Revenue $3,300,000
Less operating expenses:
Salaries
Physicians $1,360,000
Nurses 146,000
Nursing aide 63,500
Receptionist 54,000
Accounting services 40,000
Training 125,000
Supplies 259,000
Phone and fax 3,700
Insurance 301,000
Depreciation 242,000
Utilities 20,400
Miscellaneous 72,000
Total operating expenses 2,686,600
Income before taxes 613,400
Less taxes on income 214,690
Net income $398,710
The following changes are expected in 2018:
1. The clinic is expecting a 2 percent decline in revenues
because of increasing pressure from insurance companies.
2. Physicians are planning to hire a physician assistant at a
salary of $47,000 per year.
3. Training costs are expected to increase by $15,000.
4. Supplies are expected to increase to be 10 percent of
revenue.
5. Phone, fax, accounting services and insurance amounts will
stay the same.
6. Depreciation expense will increase by $21,000 per year,
since the clinic is planning to purchase equipment for
$125,000.
7. Utilities and miscellaneous expenses are expected to
increase by 5 percent next year.
8. Taxes on income will be 35 percent.
Prepare a budgeted income statement for Dynatech Healthcare
for the year 2018. (Round answers to 0 decimal places, e.g.
125.)
Dynatech Healthcare
Budgeted Income Statement
December 31, 2018For the Year Ended December 31, 2018For the
Quarter Ended December 31, 2018
MiscellaneousTotal operating expensesAccounting servicesIncome
before taxesSalaries of NursesOperating
expensesSuppliesUtilitiesTaxes on incomeNet
income/(loss)Depreciation on office and equipmentRevenueSalaries of
ReceptionistInsuranceSalaries of PhysiciansSalaries of Physician
assistantSalaries of Nursing aidTrainingPhone and fax $
AddLess
:
UtilitiesTotal operating expensesSalaries of Nursing
aidRevenueInsuranceSalaries of Physician assistantNet
income/(loss)Income before taxesPhone and faxSalaries of
ReceptionistAccounting servicesTrainingSuppliesSalaries of
PhysiciansDepreciation on office and equipmentOperating
expensesMiscellaneousTaxes on incomeSalaries of Nurses
Miscellaneous Income before taxes Salaries of Receptionist
Revenue Total operating expenses Salaries of Physician assistant
Phone and fax Salaries of Nursing aid Training Depreciation on
office and equipment Utilities Salaries of Nurses Insurance Taxes
on income Supplies Net income/(loss) Operating expenses Accounting
services Salaries of Physicians
Salaries of Receptionist Phone and fax Insurance Supplies
Taxes on income Depreciation on office and equipment Income before
taxes Miscellaneous Net income/(loss) Revenue Salaries of
Physicians Total operating expenses Operating expenses Accounting
services Salaries of Physician assistant Salaries of Nurses
Training Utilities Salaries of Nursing aid
Salaries of Nurses Miscellaneous Training Insurance Salaries
of Receptionist Utilities Phone and fax Salaries of Physician
assistant Depreciation on office and equipment Supplies Total
operating expenses Income before taxes Salaries of Nursing aid
Taxes on income Accounting services Net income/(loss) Revenue
Operating expenses Salaries of Physicians
Supplies Salaries of Physicians Salaries of Nurses Phone and
fax Miscellaneous Salaries of Physician assistant Operating
expenses Training Taxes on income Revenue Accounting services
Salaries of Nursing aid Insurance Income before taxes Total
operating expenses Depreciation on office and equipment Salaries of
Receptionist Utilities Net income/(loss)
Salaries of Receptionist Salaries of Physician assistant Total
operating expenses Taxes on income Depreciation on office and
equipment Income before taxes Miscellaneous Phone and fax Training
Utilities Net income/(loss) Revenue Operating expenses Salaries of
Nursing aid Accounting services Salaries of Nurses Supplies
Insurance Salaries of Physicians
Salaries of Physician assistant Salaries of Physicians Income
before taxes Salaries of Receptionist Accounting services Operating
expenses Miscellaneous Utilities Total operating expenses Taxes on
income Insurance Depreciation on office and equipment Supplies Net
income/(loss) Salaries of Nurses Revenue Salaries of Nursing aid
Training Phone and fax
Training Supplies Taxes on income Salaries of Physician
assistant Phone and fax Income before taxes Insurance Depreciation
on office and equipment Net income/(loss) Salaries of Receptionist
Revenue Salaries of Nurses Utilities Salaries of Physicians
Salaries of Nursing aid Accounting services Operating expenses
Miscellaneous Total operating expenses
Supplies Accounting services Depreciation on office and
equipment Salaries of Nursing aid Net income/(loss) Revenue Taxes
on income Utilities Total operating expenses Training Miscellaneous
Income before taxes Operating expenses Salaries of Nurses Salaries
of Physicians Salaries of Physician assistant Phone and fax
Insurance Salaries of Receptionist
Net income/(loss) Salaries of Nurses Training Revenue
Utilities Operating expenses Accounting services Salaries of
Receptionist Salaries of Physicians Income before taxes Salaries of
Physician assistant Miscellaneous Depreciation on office and
equipment Salaries of Nursing aid Total operating expenses Taxes on
income Supplies Phone and fax Insurance
Salaries of Physicians Training Accounting services
Depreciation on office and equipment Utilities Salaries of
Physician assistant Insurance Net income/(loss) Revenue
Miscellaneous Salaries of Nurses Salaries of Nursing aid Salaries
of Receptionist Income before taxes Operating expenses Taxes on
income Supplies Phone and fax Total operating expenses
Income before taxes Salaries of Nurses Accounting services
Taxes on income Revenue Training Utilities Salaries of Physicians
Salaries of Physician assistant Supplies Phone and fax
Miscellaneous Total operating expenses Operating expenses Insurance
Net income/(loss) Salaries of Nursing aid Salaries of Receptionist
Depreciation on office and equipment
Supplies Phone and fax Training Net income/(loss) Salaries of
Receptionist Salaries of Nurses Total operating expenses Salaries
of Physicians Utilities Insurance Income before taxes Operating
expenses Accounting services Miscellaneous Depreciation on office
and equipment Taxes on income Revenue Salaries of Nursing aid
Salaries of Physician assistant
Total operating expenses Revenue Operating expenses Salaries
of Physician assistant Taxes on income Net income/(loss)
Depreciation on office and equipment Utilities Miscellaneous
Salaries of Physicians Income before taxes Supplies Phone and fax
Salaries of Nurses Salaries of Nursing aid Accounting services
Salaries of Receptionist Training Insurance
Operating expenses Revenue Total operating expenses Utilities
Salaries of Physicians Phone and fax Salaries of Physician
assistant Salaries of Nurses Miscellaneous Salaries of Nursing aid
Salaries of Receptionist Income before taxes Taxes on income
Insurance Accounting services Net income/(loss) Training Supplies
Depreciation on office and equipment
MiscellaneousUtilitiesPhone and faxSalaries of
PhysiciansTrainingDepreciation on office and equipmentIncome before
taxesSalaries of ReceptionistAccounting servicesTaxes on
incomeTotal operating expensesSalaries of NursesNet
income/(loss)Salaries of Nursing aidSuppliesInsuranceOperating
expensesSalaries of Physician assistantRevenue
LessAdd
:
Total operating expensesIncome before taxesSalaries of
NursesUtilitiesTrainingSuppliesMiscellaneousPhone and faxSalaries
of Nursing aidDepreciation on office and equipmentAccounting
servicesTaxes on incomeNet income/(loss)Salaries of
ReceptionistInsuranceRevenueOperating expensesSalaries of
PhysiciansSalaries of Physician assistant
Salaries of PhysiciansSalaries of ReceptionistSalaries of
Physician assistantSalaries of NursesIncome before taxesTotal
operating expensesTaxes on incomeNet
income/(loss)RevenueMiscellaneousDepreciation on office and
equipmentSalaries of Nursing aidUtilitiesOperating
expensesAccounting servicesTrainingInsuranceSuppliesPhone and fax
$