Please solve for problem 16 a, b, &c asap!

Thank you.

CHAPTER 9 USING CoST INFORMATION TO MAKE SPECIAL DECISIONS 452 16. Expand-or-reduce. The administrator of ABC Hospital, Mr. Stevens, has just received the latest financial report, and the news is not good. The hospital has been losing money for over a year, and if things don't improve, it may lose its AA bond rating. Stevens has met with his vice president of finance, Mr. Sanger, and has asked him to identify areas for cutting costs, beginning with services that are operating at a loss. The following informa- tion is for services provided at ABC Hospital's ambulatory care clinic: Annual volume (in patient visits) 7,000 Charge per visit $155 Variable cost per visit $45 Fixed costs $700,000 a. Suppose that all fixed costs are avoidable. What should Sanger recommend to Stevens regarding dropping the clinic? b. What if only $300,000 of the fixed costs were avoidable? Would this change his recommendation? c. Are there any other considerations that should be taken into account when making this decision? 17. Add-or-drop decision. The Ancome County Health Department is considering using 300 square feet of excess office space to provide a clinic for Healthchek visits. These visits are reimbursed at 5 under a Medicaid program. Variable costs per visit are $45, and provid ing the service requires an additional physician assistant and nurse with prorated salaries of $85,000 and $65,000, respectively. The state has mandated efforts to increase the uti lization of Medicaid eligibility, so the Department of Social Service conducting interventions to increase eligibility awareness in the community. As a result, the health department expects 12,000 Healthchek visits in the coming year. No oidable overhead costs for the health department are $300,000 per year and will be allocated to each program based on its proportional share of the health department's total office space of 2,700 square feet a. What are the total contribution margin and total prod argin for a Healthc