Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

See Exhibits Below Full Question Question: Review the communication below. For each number ( e . g . , [ 1 ] , [ 2

See Exhibits Below Full Question Question: Review the communication below. For each number (e.g.,[1],[2], etc.), input the correct amount or choose the correct answer from the option list provided by using the information in the exhibits. To: Taylor Soard, CEO From: Jake Moore, Accounting Department Manager Re: Breakeven Analysis for Pediatrics Date: May 15, Year 7 Hello Taylor, At Pediatrics' current capacity of 60 beds, total fixed costs are $[1], the contribution margin is $[2], and the breakeven point in patient days is [3]. If we provide 20 additional beds to Pediatrics, net income should [4] by $[5]. Best, Jake Item Answer 1.2.3.4.5. Exhibit 1. Costs to Granville Hospital for Renting to Pediatrics Patient DaysBed CapacityVariable Fixed Dietary$1,800,000Janitorial$ 210,000 Laundry900,000Laboratory1,350,000Pharmacy1,050,000Repairs and maintenance90,000 General admin3,900,000 Rent4,500,000 Billings and collection900,000Total $6,000,000 $8,700,000 Exhibit 2 : Granville Hospital Management's Discussion and Analysis (excerpt from annual report) Our company is a general hospital renting space to entities within the hospital. Each entity receives common services from the hospital, such as patients' meals, laundry, and billings and collections. Space and bed rentals are fixed charges for the year, based on bed capacity rented to each entity. Pediatrics is one of the entities in Granville Hospital. Its current capacity is 60 beds, and it operated at full capacity for 90 days during the period. We charged Pediatrics $900 per patient day, resulting in revenues of $18,000,000. We conducted a breakeven analysis to evaluate the financial effects of providing 20 additional beds to Pediatrics. Our analysis assumes that Pediatrics' annual number of patient days, and our costs (variable and fixed) relating to Pediatrics, will increase proportionally. However, the fee we charge Pediatrics per patient day will not change. Exhibit 3: Staffing Requirements Annual Patient Days Aides Nurses Supervising Nurses Up to 21,9002010421,901 to 26,0002613426,001 to 29,20030154 Exhibit 4: Annual Salary Supervising nurse$70,000Nurse60,000Aide28,0001
What is the fixed cost? What is the contribution margin? What is the Total Patient days (BEP) Breakeven Analysis? What is the Net income? Has the net income increase or decrease?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Survey of Accounting

Authors: Paul D. Kimmel, Jerry J. Weygandt

1st edition

1119330025, 978-1119444244, 1119444241, 978-1119306474, 1119306477, 978-1119330028

More Books

Students also viewed these Accounting questions

Question

Explain the three methods described for calculating value at risk.

Answered: 1 week ago

Question

How would you create an objects and program document using UML?

Answered: 1 week ago