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Assume that the manager of the rehabilitation department of Getwell Hospital is setting the price on a new outpatient service for electrical stimulation of muscles.
Assume that the manager of the rehabilitation department of Getwell Hospital is setting the price on a new outpatient service for electrical stimulation of muscles. Here are the relevant data estimates:
Variable cost per visit: $15.00
Annual direct fixed costs: $650,000
Annual overhead allocation: $75,000
Expected annual visits: 8,000
What price per visit must be set for the service to breakeven?
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