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K L M a A B D E F G H 1 J 21 22 Fixed Costs $ 500,000 23 Volume 7500 24 Revenue Per
K L M a A B D E F G H 1 J 21 22 Fixed Costs $ 500,000 23 Volume 7500 24 Revenue Per Procedure $ 100 25 VC Per Procedure $ 25 26 27 28 Construct the group's base case projected profit and loss statement: 29 Projected Profit and Loss Statement 30 Annual Sales $ 750,000 31 Variable Costs $ 187,500 32 Contribution $ 562,500 33 Fixed Costs $ 500,000 34 Profit $ 62,500 35 36 37 38 b What is the group's contribution margin? What is it's accounting breakeven point? 39 Contribution Margin $ 75 40 Breakeven Point 6666.6667 41 42 43 44 C What volume is required to produce a pretax profit of $100,000? A pretax profit of $200,000 45 Volume required to produce a pretax profit of $100,000 46 47 8000 48 49 50 Volume required to produce a pretax profit of $200,000 51 52 9333.333333 53 54 55 d. Assume that the practice contracts with one HMO, and the plan proposes a 20% discount from charges. 56 Answer questions a, b, and c under those conditions. 57 58
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