Question
Info: http://s000.tinyupload.com/index.php?file_id=49209145977479835214 Use the information in Table 4 to compute the average collected revenue per unit for each of the surgery / procedure cost objects,
Info: http://s000.tinyupload.com/index.php?file_id=49209145977479835214
Use the information in Table 4 to compute the average collected revenue per unit for each of the surgery / procedure cost objects, and compare it to the unit costs (direct plus indirect) assigned to that cost object. Compute the profit per unit both before MD compensation is included and after MD compensation is included. What is the most profitable product line for MCCS? What are the reasons it is more profitable? For example, is the collection rate higher? Are the costs lower? How does this break down by payor class? Given that the surgeons are the business owners and can take business profits in the form of compensation or partnership distributions, do you think MD compensation should be included as a cost in the profitability analysis? Prepare the most useful profitability analysis that you can and interpret it for Linda and the MCCS surgeons. Do you have any advice for MCCS?
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