Business, 24.10.2019 03:50, mdndndndj2981

Assume that the managers of fort winston hospital are setting the price on a new outpatient service. here are the relevant data estimates:

variable cost per visit: $5

annual direct fixed costs: $500,000

annual overhead allocation: $50,000

expected annual utilization: 10,000 visits

a.) what per visit price must be set for the service to break even? to earn an annual profit of $100,000?

b.) repeat part a, but assume that the variable cost per visit is $10.

c.) return to the data given in the problem. again repeat part a, but assume that the direct fixed costs are $1,000,000.

d.) repeat part a assuming both a $10 variable cost and $1,000,000 in direct fixed costs.

Answers: 2

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Assume that the managers of fort winston hospital are setting the price on a new outpatient service....