Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I am having trouble answering the following questions using the attachment provided. Could you please help me? 1.Prepare a contribution income statement for Pediatrics for

I am having trouble answering the following questions using the attachment provided. Could you please help me?

1.Prepare a contribution income statement for Pediatrics for the year ended June 30, 2019.

2.Calculate the number of patient-days that Pediatrics generated in revenue for the year ended June 30, 2019.

3.Compute the contribution margin per patient days generated for the year ended June 30, 2019.

4.Calculate the minimum number of patient-days required for Pediatrics to break even for the upcoming year June 30, 2020.Assume that revenue per patient-day, cost per patient-day,

cost per bed and salary rates for this upcoming year June 30, 2020, remain the same as for the year ended June 30, 2019.

5.Calculate the operating leverage ratio.

6.If demand for patient days are projected to increase from the 2019 current patient demand in 2020:4%

Calculate the increase in income using the operating leverage.

7.Prepare a contribution income statement showing the projected 2020 revenue and costs if the demand for patient days increases in 2020 to the projected increase stated in #6.

8.Using the profit for end of year June 30, 2019 and June 30, 2020, prove that the change in income between the two years equals the percentage change in #6.

9.Recommend to Pediatrics what they should do as the operations grow and have the ability to exceed the current capacity limits that Helping Hospital has put on Pediatrics.

Include in your response on average how many beds Pediatrics is currently using daily and how much will this increase based on #6 projected increase in 2020.

Explain why the relevant range is important to know and understand and how it impacts your recommendation.Assume a 365 day year.

image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Understanding Financial Accounting

Authors: Christopher D. Burnley

2nd Canadian Edition

1119406927, 978-1119406921

More Books

Students also viewed these Accounting questions

Question

Where are most new banks chartered in the United States?

Answered: 1 week ago

Question

14. Now reconcile what you answered to problem 15 with problem 13.

Answered: 1 week ago