With the population aging and patients who dread sitting in a sterile dental office, dentists are finding an opportunity in dental house calls. The Blende Dental Group has taken its service on the road in San Francisco and New York City, performing everything from routine exams and cleanings to root canals. Some patients are wealthy and prefer the personal service, whereas others are elderly homebounds who cannot get out to the dentist's office. Recreating a dental office in a home requires additional equipment, such as a portable X-ray machine that looks like a ray gun, sterile water tanks, a dental drill, lights, and a laptop. A portable X-ray machine alone costs

$7,500.

What types of fixed costs are associated with this service? Assuming fixed costs of adding this mobile service will increase by

$22,500

and a desired contribution margin of

45

percent, determine the amount of sales necessary to break even on this increase in fixed costs to offer this additional service.

Part 2

What types of fixed costs are associated with this service? Hint: See the Break-Even and Margin Analysis section of Appendix 3 in your textbook. Select all that apply.