Company, a not-for-profit acute care facility has this cost structure for its inpatient services:

Fixed costs $10,000,000
Variable cost per inpatient day $200
Charge (revenue) per inpatient day $1,000

The hospital expects to have a patient load of 15,000 inpatient days next year.

1. Construct hospitalĂ˘??s base case projected P&L statement

2. HospitalĂ˘??s break-even point

3. What volume is required to provide a profit of $1,000,000. A profit of $500,000?

4. Assume that 20 percent of the hospitalĂ˘??s inpatient days come from a managed care plan that wants a 25 percent discount from charges. Should the hospital agree to the discount proposal?

Managers of a hospital are setting the price on a new outpatient service. Data listed:

Variable cost per visit $5.00
Annual direct fixed costs $500,000
Annual overhead allocation $50,000
Expected annual utilization 10,000 visits

1. What per visit must be set for the service to break even? To earn annual profit of $100,000.

2. Repeat Part 1, assume variable cost per visit is $10

3. Return to the data given in problem. Again repeat Part 1, but assume direct costs are $1,000,000

4. Repeat Part 1 assuming both a $10 variable cost and $1,000,000 in direct fixed costs

Solution Summary

The solution performs a Fixed Cost Analysis for a not-for-profit acute care facility and computes projected P&L statement
, breakeven point, required profit, agreeing on discount proposal decision.

One more limitation of cost-volume-profit analysis is that it assumes that fixedcosts are unlikely to stay constant as output increases beyond a certain range of activity. Security and lighting for instance may be regarded as fixedcosts at some point but as production increases there may be need to light up and guard additiona

Describe how attempts to recover fixedcosts of capacity may lead to price increases and lower demand. Also describe to me what Inventory Costing and Capacity Analysis is and give me an example of when it is used.

If the fixedcost of producing 100 is $130, then
a. fixedcost of producing 0 is $0,
b. fixedcost of producing 0 is less than $130
c. fixedcost of producing 200 is $260
d. fixedcost of producing 200 is $130
e. cannot determine.

Costanalysis:
A small company manufactures picnic tables. The weekly fixedcost is $1,200 and the variable cost is $45 per table. Find the total daily cost of producing X picnic tables. How many picnic tables can be produced for a total weekly cost of $4,800?
Please show all work in algebra form.

1.
An economist estimated that he cost function of single-prodcut firm is
C(Q) = 100 + 20Q + 15Q2 + 10Q3
Based on this information, determine:
a. The fixedcost of producing 10 units of output
b. The variable cost of producing 10 units of output
c. The total cost of producing 10 units of output
d. The average fixed cos

In a slow year, Deutsche Burgers will produce 2.0 million hamburgers at a total cost of $4.4 million. In a good year, it can produce 4.4 million hamburgers at a total cost of $5.0 million. What are the variable and fixedcosts of hamburger production? (Enter your answers in dollars not in millions. Round "Variable cost" to 2 dec

A. Fill in the blanks in the following table.
b. Draw a graph that shows marginal cost, average variable cost, and average total cost, with cost on the vertical axis and quantity on the horizontal axis.
units of
out put- fc- var cost- total cost- marginal cost- avg fixedcost - avc- avg total cost
0

James Manufacturing company provides the following information about its cost structure:
Selling Price $20.00 per book
Variable cost per unit: $6.00
Fixedcosts: 112000 per year
How many units must be sold to break-even?
Assume the variable cost and the price were both cut by $4.00 per unit. Which of the following would c

5. Calculate the unknowns for the following independent situations. All given activity levels are within the relevant range.
A) Total fixedcosts for Company A are $250,000. Total costs, both fixed and variable, are $378,000 for Company A when 40,000 units are produced.
Calculate:
1) variable cost per unit
2) fi