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Assume that the managers of Fort Winston Hospital are setting the price on a new outpatient service. Here are relevant data estimates: Variable cost per
Assume that the managers of Fort Winston Hospital are setting the price on a new outpatient service. Here are relevant data estimates: Variable cost per visit $ 5.00 Annual direct fixed costs $500,000 Annual overhead allocation $ 50,000 Expected annual utilization 10,000 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 direct fixed costs are $1,000,000. d. Repeat Part a assuming both $10 in variable cost and $1,000,000 in direct fixed costs
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