Revenue is not being maximized from endoscopies

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Reference no: EM132035051

As the Director of Clinical Operations, you are concerned that revenue is not being maximized from endoscopies, which are performed less frequently. These are reimbursed at only $287 each but are much quicker to perform. You would like to see the operating income from endoscopies increase to $600,000 per year. Variable costs are $97 per procedure which includes all facilities fees, equipment, and salary because payment to the physicians and the hospital for using its space for the procedure is all based on per procedure fees. Fixed costs include insurance and licensing fees for the group at $25,000 for the year. First calculate the contribution margin and then how many endoscopies would need to be performed in a year to attain the target operating income. Please label your answers appropriately.

Reference no: EM132035051

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