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You represent the management team at Marble Valley Medical Center, a 95 bed, non-profit general acute care hospital. Their financial statements as of June 30, 2020. They are in the picture below. You are reviewing these financial statements with your governing board finance committee and the question of interest rates comes up. You currently have one large debt item and some smaller equipment loans in your long term debt. The major debt item is a 2008 bond issue totaling $27,500,000, payable annually at 7.25% for 20 years. the debt was issued under an A credit rating by Standard & Poors. You still qualify for similar debt rating today. You also have a short-term credit revolver (which is the amount in your "other current liabilities") that you are currently paying 4% on, but have crossed a debt size threshold ($2 million) where the interest rate will increase to 8% in the next year. Neither of these debt instruments have prepayment penalties. Formulate an analysis of the debt situation you have and present a recommendation to the board on your debt structure, based on the current interest rate landscape. 13374410

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Subject: Business, Finance

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