Reference no: EM132825198

You are considering starting a walk-in clinic. Your financial projections for the first year of operations are as follows:

Number of visits 10,000.                   Utilities $2,500
Wages and benefits $220,000        Medical supplies $50,000
Rent $5,000                                 Administrative supplies $10,000
Depreciation $30,000

Assume that all costs are fixed except supplies costs, which are variable.

Problem a. What is the clinic's underlying cost structure?

Problem b. What are the clinic's expected total costs?

Problem c. What are the clinic's estimated total costs at 7,500 visits? At 12,500 visits?

Problem d. What is the average cost per visit at 7,500, 10,000, and 12,500 visits?