Question
Health-Temp Company is a placement agency for temporary nurses. It serves hospitals and clinics throughout the metropolitan area. Health-Temp Company believes it will place temporary
Health-Temp Company is a placement agency for temporary nurses. It serves hospitals and clinics throughout the metropolitan area. Health-Temp Company believes it will place temporary nurses for a total of 21,000 hours next year. Health-Temp charges the hospitals and clinics $90 per hour and has variable costs of $78.30 per hour (this includes the payment to the nurse). Total fixed costs equal $238,095. Required: 1. Calculate the contribution margin per unit and the contribution margin ratio (express the ratio as a decimal rather than a percentage). If required, round your answers to two decimal places. Contribution margin per unit $fill in the blank 1 Contribution margin ratio fill in the blank 2 2. Calculate the sales revenue needed to break even. $fill in the blank 3 3. Calculate the sales revenue needed to achieve a target profit of $72,540. $fill in the blank 4 4. What if Health-Temp had target operating income (profit) of $88,920? Would sales revenue be larger or smaller than the one calculated in Requirement 3? By how much? $fill in the blank 6
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