Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Case 7-53 Break-Even Analysis; Hospital CVP Relationships (LO 7-1, 7-4) Delaware Medical Center operates a general hospital. The medical center also rents space and
Case 7-53 Break-Even Analysis; Hospital CVP Relationships (LO 7-1, 7-4) Delaware Medical Center operates a general hospital. The medical center also rents space and beds to separately owned entities rendering specialized services, such as Pediatrics and Psychiatric Care. Delaware charges each separate entity for common services. such as patients' meals and laundry, and for administrative services, such as billings and collections. Space and bed rentals are fixed charges for the year, based on bed capacity rented to each entity. Delaware Medical Center charged the following costs to Pediatrics for the year ended June 30, 20x1: Dietary Janitorial Laundry Laboratory Pharmacy Repairs and maintenance General and administrative Rent Billings and collections Total Patient Days Bed Capacity (variable) $ 550,000 (fixed) $ 72,000 260,000 450,000 300,000 33,000 1,340,000 1,570,000 250,000 $1,810,000 $3,015,000 During the year ended June 30, 20x1, Pediatrics charged each patient an average of $300 per day, had a capacity of 60 beds, and had revenue of $7 million for 365 days. In addition, Pediatrics directly employed personnel with the following annual salary costs per employee: supervising nurses, $25,500, nurses, $20,900; and aides, $8,600.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started