Assume that a radiologist group practice has the following cost structure:
	Fixed Costs			$500,000
	Variable cost per procedure			25
	Charge (revenue) per procedure			100
Furthermore, assume that the group expects to perform 7,500 procedures in the coming year.
a. Construct the group's base case projected P&L statement
	Total revenues			$ 750,000
	Total variable costs			$ (187,500)
	Total contribution margin			$ 562,500
	Fixed costs			$ (500,000)
	Profit (net income)			$ 625,000
b. What is the group's contribution margin? What is its breakeven point?
	Revenue per procedure			$ 100
	Variable cost per procedure			$ 25
	Contribution margin per procedure			$ 562,500
	Fixed costs
	Contribution margin per procedure
	Accounting Breakeven				visits
c.1 What volume is required to provide a pretax profit of $100,000?
	Fixed costs
	Target profit
	Contribution margin per procedure
	Economic Breakeven				visits
c.2 What volume is required to provide a pretax profit of $200,000?
	Fixed costs
	Target profit
	Contribution margin per procedure
	Economic Breakeven				visits
d. We are skipping
e. now assume a 20 percent discount from charges. Redo questions a, b, and c under these conditions.
redo a. Construct the group's base case projected P&L statement
	Total revenues
	Total variable costs
	Total contribution margin
	Fixed costs
	Profit (net income)
redo b. What is the group's contribution margin? What is its breakeven point?
	Revenue per procedure
	Variable cost per procedure
	Contribution margin per procedure
	Fixed costs
	Contribution margin per procedure
	Accounting Breakeven				visits
redo c.1 What volume is required to provide a pretax profit of $100,000?
	Fixed costs
	Target profit
	Contribution margin per procedure
	Economic Breakeven				visits
redo c.2 What volume is required to provide a pretax profit of $200,000?
	Fixed costs
	Target profit
	Contribution margin per procedure
	Economic Breakeven				visits