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Problem 2 Assume that an audiologist group practice has the following cost structure: Fixed costs: Variable costs per procedure $600,000 $40 Charge (revenue) per
Problem 2 Assume that an audiologist group practice has the following cost structure: Fixed costs: Variable costs per procedure $600,000 $40 Charge (revenue) per procedure $100 Assume the group expects to perform 8,000 procedures for the coming year. a. Construct the group's base case projected income statement (P&L) for the year. b. What is the group's contribution margin? c. Calculate the break-even point. d. Calculate the number of procedures required to produce a pretax profit of $150,000.
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