Complete a cash flow analysis for a new MRI service for the physician’s network.

Capital budgeting and financing for the healthcare sector

Start-up
• Purchase of MRI equipment: $500,000
• Refurbish facility for housing the MRI: $50,000
• Hiring and training Technicians: $25,000
• Real estate fees and permits: $20,000
• Initial advertising and promotion:$10,000
The total start-up expenses are $605,000

The Operating Cash Flow Over Three Years

Year 1 Year 2 Years 3

Revenue from patients: $750K $900K $1.05M Expenses

Salaries/wages 300K 350K 400K

Utilities 15K-20K25k

Indemnity Insurance 10k 12k 14k

Maintenance 9k 11k13k Depreciation 100k100kk 100kk Advertising 452.5KK 8.5kk.9.5kk Other 10k-12k 14KK Total Expenses 555KK 503.5 KKK. 555V NET INVESTMENT 297T 397T495TT