Finance question

a. 17.4 Consider the following financial statements for BestCare HMO, a not-for-profit managed care plan:  BestCare HMO  Statement of Operations and Change in Net Assets  Year Ended June 30, 2XXX  (in thousands)  Revenue:  Premiums earned $26,682  Coinsurance $1,689  Interest and other income $242  Total revenue $28,613  Expenses:  Salaries and benefits $15,154  Medical supplies and drugs $7,507  Insurance $3,963  Provision for bad debts $19  Depreciation $367  Interest $385  Total expenses $27,395  Net income $1,218  Net assets, beginning of year $900  Net assets, end of year $2,118  BestCare HMO  Balance Sheet  Year Ended June 30, 2XXX  (in thousands)  Assets  Cash and cash equivalents $2,737  Net premiums receivable $821  Supplies $387  Total current assets $3,945  Net property and equipment $5,924  Total assets $9,869  Liabilities and Net Assets  Accounts payable - medical services $2,145  Accrued expenses $929  Notes payable $141  Current portion of long-term debt $241  Total current liabilities $3,456  Long-term debt $4,295  Total liabilities $7,751  Net assets - unrestricted (equity) $2,118  Total liabilities and net assets $9,869  a. Perform a Du Pont analysis on BestCare. Assume that the industry average ratios are as follows:  Total margin 3.8%  Total asset turnover 2.1  Equity multiplier 3.2  Return on equity (ROE) 25.5% 

b. Calculate and interpret the following ratios for BestCare:  Industry average  Return on assets (ROA) 8.0%  Current ratio 1.3  Days cash on hand 41 days  Average collection period 7 days  Debt ratio 69%  Debt-to-equity ratio 2.2  Times interest earned (TIE) ratio 2.8  Fixed asset turnover ratio 5.2