5.5 You are considering starting a walk-in clinic. Your financial projections for Year_1 of operations are as follows:

Revenue (derived from 10,000 visits$400,000

Salaries and benefits200,000

Rent5,000

Depreciation30,000

Utilities2,500

Medical supplies50,000

Administrative supplies10,000

Assume:All costs are fixed except supply costs which are variable. Assume also that the clinic is a for-profit entity and pays taxes at a 30% rate.

a. Fixed costs = ___________________ (3 points)

b. Variable costs = _________________ (3 points);

b_1.Variable cost per visit = _____ (3 points)

Category 10,000 ? ?

A B C

Total revenues? ? ?

Total variable costs ? ? ?

Total contribution margin ? ? ?

Total fixed costs ? ? ?

Taxable income ? ? ?

Taxes @ 30% ? ? ?

Net income/(loss)? ? ?

c. Using Column A, construct a base-case scenario or P&L statement based on the primary assumptions. (14 points)

d. Using the C-V-P formula and showing your work below, calculate the break-even volume for the clinic. At break-even there is 0 taxable income and profit equals 0. (5 points)

Total revenue - Total variable cost - Fixed costs = Profit

e. Determine volume of visits required to achieve a $100,000 profit after taxes. (5 points)