Description
Read Case 16 (pages 97-101) from Gapenski’s Cases in Healthcare Finance – “Seattle Cancer Center.”
URL for case study: http://ezproxy.umgc.edu/login?url=https://search.ebscohost.com/login.aspx?direct=true&db=nlebk&AN=1792719&site=eds-live&scope=site
Create a presentation in Microsoft PowerPoint (PPT), suitable for presentation to a senior level executive. The final product should include a title slide with your name and the name of the case. Two or three slides per question (see below) should be sufficient to respond appropriately to the case prompts. Slide numbers should be included. Use of non-case related graphics is not required. All Excel work should be imported into the presentation in table format (in the body of the document) or enclosed as an Appendix within the same document. Use of external resources and articles is encouraged, but not required. References should be cited in APA format, either as a footnote on the slide where the information / data is used or in an appendix slide.
In your presentation, provide a response to the following questions from the case study:
- Should the Center lease the equipment?
- What is the maximum lease payment that the Center would be willing to pay?
- What would be the NAL to the Center if tax-exempt (municipal) debt financing was available to the Center?
- Would the availability of tax-exempt debt financing make leasing more or less attractive to the Center than before? Why?
As a baseline, assume all cash flows have the same risk; that is, ignore residual value risk and use the same discount rate for all lessee cash flows.
Here are some additonal notes for the project:
Seattle Cancer Center Case Study:
In your presentation, provide a response to the following 4 questions:
- Should the Center lease the equipment?
- What is the maximum lease payment that the Center would be willing to pay?
- What would be the NAL to the Center if tax-exempt (municipal) debt financing was available to the Center?
- Would the availability of tax-exempt debt financing make leasing more or less attractiveto the Center than before? Why?
I encourage you to Downloading the Student Companion Website – Models from the ACHE Website on the E-Book, Understanding Healthcare Financial Management, Seventh Edition, for additional support on understanding some of the class exercises and course concepts. (Zip file download). Also, download the Student Resources from the ACHE Website on the E-Book, Gapenski’s Cases in Healthcare Finance, Sixth Edition, for additional support on course’s case studies. (Zip file download)
These Resources will definitely help you to answer the 4 questions. PLEASE NOTE: NOT ALL TABLES IN THE STUDENT RESOURCES FOR THIS ASSIGNMENT NEED TO BE COMPLETED. For example, you are not being asked to compare a lease vs. owning option. The First table and the Table related to the non-profit 5% loan availability need to be done. To assist in completing these two tables, the estimated residual value to the Seattle Cancer Ctr is $1,200,000, for GB Financing @1,600,000.
When you utilize the Student Resource for this Case Study, some of the key findings will automatically calculate for your analysis. In preparing your PowerPoint, be sure to explain the rationale for your answers, do not just provide the numbers.
