Key concept: Forecasting an income statement for a proposed clinic per month plus a variable amount equal to 30 percent of monthly revenues Rental expense is estimated to be constant at $3.000 per month Supplies expense is estimated at 6 percent of monthly revenues Other expenses are estimated as a fred amount of Soo per month plus a variable amount equal to 4 percent of monthly revenues. Assignment and Questions Dr. Cheryl Jacobsen was preparing to open a beachfront medical clinic, which a would provide a variety of medical services to boogie boarders, surfers, and other beachgoers, in January 2015. She planned to operate IOP Boogie Clinic incasa subchapter Stax entity Because she had recently finished her medical residency very much in debt, Dr. Jacobsen needed to borrow money to finance the opening of the clinic. She asked her mother to loan IOP Boogie Clinic 550,000 for operating funds to get started Dr. Jacobsen promised to pay her mother 6 percent interest on the loan Dr. Jacobsen's mother was willing to make the loan. However, at the suggestion of Dr. Jacobsen's stepfather, Tom (CPA), her mother asked her to prepare month y financial statement forecasts for the clinic's first year of operation. Tom believed that the forecasting exercise would help Dr Jacobsen anticipate potential operating problems and make more realistic operating choices Dt Jacobsen was not sure exactly how to prepare forecasted financial state ments, but her stepfather said he would help her with the mechanics if she would provide the data about how the clinic would operate with a little prompting from her stepfather, Dr. Jacobsen provided the following estimates and assumptions 1. Imagine you are assisting Dr. Jacobsen, and create an Excel workbook using the format on page 192. Prepare the monthly forecasted income statements (opera- tions statements) for IOP Boogie Clinic Inc. for January through December 2. During what month does the clinic break even for monthly operations? 3. What is the approximate number of patients at the monthly operations breakeven point? 4 During what month does the clinic break even on a year to date (cumulative) basis 5. What is the most critical forecasting assumption? Why? + The dinic anticipates no patients in January, but this patient volume is pected to increase 12 percent per month Average charge price) per patient will be to, and price is not expected to change during the year Key concept: Forecasting an income statement for a proposed clinic per month plus a variable amount equal to 30 percent of monthly revenues Rental expense is estimated to be constant at $3.000 per month Supplies expense is estimated at 6 percent of monthly revenues Other expenses are estimated as a fred amount of Soo per month plus a variable amount equal to 4 percent of monthly revenues. Assignment and Questions Dr. Cheryl Jacobsen was preparing to open a beachfront medical clinic, which a would provide a variety of medical services to boogie boarders, surfers, and other beachgoers, in January 2015. She planned to operate IOP Boogie Clinic incasa subchapter Stax entity Because she had recently finished her medical residency very much in debt, Dr. Jacobsen needed to borrow money to finance the opening of the clinic. She asked her mother to loan IOP Boogie Clinic 550,000 for operating funds to get started Dr. Jacobsen promised to pay her mother 6 percent interest on the loan Dr. Jacobsen's mother was willing to make the loan. However, at the suggestion of Dr. Jacobsen's stepfather, Tom (CPA), her mother asked her to prepare month y financial statement forecasts for the clinic's first year of operation. Tom believed that the forecasting exercise would help Dr Jacobsen anticipate potential operating problems and make more realistic operating choices Dt Jacobsen was not sure exactly how to prepare forecasted financial state ments, but her stepfather said he would help her with the mechanics if she would provide the data about how the clinic would operate with a little prompting from her stepfather, Dr. Jacobsen provided the following estimates and assumptions 1. Imagine you are assisting Dr. Jacobsen, and create an Excel workbook using the format on page 192. Prepare the monthly forecasted income statements (opera- tions statements) for IOP Boogie Clinic Inc. for January through December 2. During what month does the clinic break even for monthly operations? 3. What is the approximate number of patients at the monthly operations breakeven point? 4 During what month does the clinic break even on a year to date (cumulative) basis 5. What is the most critical forecasting assumption? Why? + The dinic anticipates no patients in January, but this patient volume is pected to increase 12 percent per month Average charge price) per patient will be to, and price is not expected to change during the year
