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Within the next 30 mins please! Need help with this Finance practice question. 1. The Suffolk Hospital is considering opening a new Urgent Care Center
Within the next 30 mins please! Need help with this Finance practice question.
1. The Suffolk Hospital is considering opening a new Urgent Care Center in a neighboring town. You have been asked to evaluate the Urgent Care Center's potential profitability and make a recommendation to either pursue or not pursue this project. You have estimated the following data: (10 points) Expected number of annual visits 8,000 Revenue per visit $100 Salaries and benefits $500,000 Drugs 80,000 Rent 70,000 Medical supplies 60,000 Utilities 50,000 Assume that all costs are fixed except drugs and medical supplies, which are variable. a. Prepare the Urgent Care Center's base case projected P&L Statement. b. What is the Urgent Care Center's projected per visit contribution margin and total contribution margin? c. What volume of visits will be required to break even? d. What volume of visits is required to make a $100,000 profit? e. What would the profit be if an insurance company that constitues 10% of the expected visits proposes a 15% discount per visit? f. Explain if you would accept the insurance company's discount proposal. WhyStep by Step Solution
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