compute contribution margin break even point number of visits with a pre tax profit and number of visits with discount

ABC Physician Enterprise (PE), a multi-specialty group practice, generated the following revenue and costs completing 10,000 visits.

Fixed costs $375,000

Variable costs per visit $20

Charge (revenue) per visit $50

Create an Excel workbook with three tabs in which you answer/solve the following:

1.What is the PE’s contribution margin? What is the break-even point?

2.What is the number of visits required to provide a pretax profit of $40,000? A pretax profit of $50,000?

3.Assume that the PE contracts with Covered Health Insurance with a proposed discount of 20% off charges. What is the PE’s number of visits required to provide a pretax profit of $40,000? How many visits are required for a pretax profit of $50,000?

ENSURE THAT THE FORMULAS AND A SUMMARY OF THE STEPS USED ARE INCLUDED EITHER ON A WORD DOCUMENT OR LAST SHEET OF EXCEL DOCUMENT.

 

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