Forest Clinic contains 600 beds. The average occupancy rate

is 90% per month. In other words, on average 90% of the clinic's beds are occupied by patients. At this level of occupancy, the clinic's operating costs are $25 per occupied bed per day, assuming a 30-day month. This $25 cost contains both variable and fixed cost elements.

During April, the clinic's occupancy rate was only 80%. A total of $390,600 in operating