Assume that a radiologist grou
| Assume that a radiologist group practice has the following coststructure: | ||||||
| Fixed costs | $500,000 | |||||
| Variable cost per procedure | 25 | |||||
| Charge (revenue) per procedure | 100 | |||||
| Furthermore, assume that the group expects to perform 7,500proce- | ||||||
| dures in the coming year. | ||||||
| a.Construct the group’s base case projected P&L statement. | ||||||
| b. part 1 -What is the group’s contribution margin? b. – part 2 – What is itsbreakeven point? | ||||||
| c. part 1 -What volume is required to provide a pretax profit of$100,000? | ||||||
| c – part 2- A pretax profit of $200,000? | ||||||
Answer:
CONTRIBUTION MARGIN IS IN DOLLAR TERMS AS NOTHING WASMENTIONED
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