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The audiology dept. at Randall offers many services. The three most common with cost and utilization data are as follows Service Variable cost per service

The audiology dept. at Randall offers many services. The three most common with cost and utilization data are as follows

Service Variable cost per service Annual direct fixed costs annual # of visits

Basic exam $5 $50,000 3,000

Advanced exam $7 $30,000 1,500

Therapy session 10 $40,000 500

What is the fee schedule for the theses services assuming that the goal is to cover only variable and direct costs?

Assume the audiology dept. is allocated $100,000 in total overhead, and the dept. director has allocated $50,000 of this amount to the 3 services listed above. What is the fee schedule? What is the fee schedule assuming these overhead costs must be covered. (to answer this question assume that the allocations of overhead costs to each service is made on the basis of number of visits)

Assume these services must make a combined profit of $25,000. Now what is the fee schedule. (to answer assume the profit requirement is allocated the same as costs.

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