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Break-Even Point Part a. Givens From Problem: Costs Dollars A B C D E F G H I A B Reimbursement Reimbursement Per Mammography (P) Fixed Costs Fixed Costs Total Fixed Costs (TFC) Total Fixed Costs (TFC) Variable Costs Variable Costs Variables Costs based on Dollar Amount per Unit Variables Costs based on Dollar Amount per Unit Sum: Sum: Break-Even Point Break-Even UnitsX = TFC / (P - V) Break-Even Point Break-Even UnitsX = TFC / (P - V) Targeted Profit Targeted Profit Targeted Profit (TF) Targeted Profit (TF) Units required to reach targeted TF, X = (TFC + TF) / (P-V) Units required to reach targeted TF, X = (TFC + TF) / (P-V) Part a. Part b. No. r Amount per Unit d TF, X = (TFC + TF) / Dollars Part c. No. Dollars Part d. No. Dollars No. C Reimbursement Reimbursement Fixed Costs Fixed Costs Total Fixed Costs (TFC) Total Fixed Costs (TFC) Variable Costs Variable Costs Variables Costs based on Dollar Amount per Unit Variables Costs based on Dollar Amou Sum: Break-Even Point Break-Even UnitsX = TFC / (P - V) Break-Even Point Break-Even Units Targeted Profit Targeted Profit Targeted Profit (TF) Targeted Profit (TF) Units required to reach targeted TF, X = (TFC + TF) / (P-V) Units required to reach targeted TF, X (P-V) D rsement xed Costs (TFC) Costs based on Dollar Amount per Unit Sum: ven Point X = TFC / (P - V) uired to reach targeted TF, X = (TFC + TF) / (P-V) Healthcare Financial Management and Economics Week 8 Assignment 2 Gulf Imaging Center Assignment 2: Break-Even Point Formulas Before making hiring or purchasing decisions, healthcare organizations must consider whether the decision is financially profitable. By calculating break-even points, organizations are able to examine actual costs and make more sound financial decisions. For this Assignment, you use data from the Gulf Imaging Center and calculate break-even points. Scenario: Gulf Imaging Center is a small imaging center with two analogue film or screen units. As the director of the center, Juanita Hernandez has been asked to determine if the current staffing is correct for her place or should she add another technologist. She currently uses 2 mammography units, 2 technologists, and 1 aide. She has analyzed the current costs and determined the following: Reimbursement per screen Equipment lease per month ($12,000 per machine) Technologists costs per mammography Technologists aide per mammography Variable cost per mammography Equipment maintenance per month ($9,000 per machine) $140 $24,000 $35 $20 $13 $18,000 To prepare for the Assignment: Examine the Gulf Imaging Center scenario. Reflect on how you will use the provided financial data to calculate break-even points. Refer to Chapter 9 of Financial Management of Health Care Organizations: An Introduction to Fundamental Tools, Concepts and Applications for additional guidance. The Assignment: Given the above information, use the \"Week 8 Assignment 2 Break Even Excel Template\" to answer these items as a Department: A. Solve for monthly volume to break even. B. Solve for monthly volume needed to break even at desired $5,000 per month profit level. C. Solve for volume needed to break even at new reimbursement of $110 per screen and no profit. D. Solve for volume needed to break even with an additional technologist. Your Assignment is due by Day 7 of Week 8. 2015 Laureate Education, Inc. Page 1 of 1