What is the break-even number of procedures

Reference no: EM131404788

Fusion Guided Biopsy

Megagroup Healthcare (aka the Group) has approached you as a consultant. The Group has a vague understanding of Fusion Guided Biopsies of the Prostate (FGP). The Group is always interested in new ways to generate income. The staff Urologist states that she has the expertise to do the biopsies, but lacks the proper equipment.

In contacting you the Group asks for paper that includes:

A brief explanation of what are Fusion Guided Biopsies of the Prostate?

What equipment and software is necessary for a successful procedure?

What is the cost of the necessary equipment and software?

What is the break-even number of procedures?

In your analysis, be sure to:

State the life span of the equipment and software.
Assume the Group has the necessary office and equipment space.
Assume the Group has the necessary supplies once the DME is purchased.
Assume that the FGP need only cover 5% of the cost of the MRI machine.
Assume that the revenue from a FGP is $2,000.
Assume that the revenue from a MRI of the prostate is $5,000.
Describe clearly any other assumptions that you make.

You are to prepare a revenue and cost analysis (in Table form).

Be sure to cite your sources.

In contacting you the Group asks for paper that includes:

What is the cost of the necessary equipment and software?

MRI cost for the necessary minimum machine is $400,000

Average Ultrasound price is about $29,000

The Uronav machine cost average is $165,000

What is the break-even number of procedures?

Revenue for a FGP with the MRI will be:

$2,000+$5,000=$7,000

Cost covered by Group is:

($400,000 * .05) + $29,000 + $165,000 = $214,000

Breakeven point:

Y = ((v/p) * Y) + F

Y = ((0/7000) * Y) + 214,000

Y = $214,000

Breakeven Procedures = 214,000/7,000 = 30.57

31 procedures would be needed to cover the cost of equipment

In your analysis, be sure to:

State the life span of the equipment and software.
Assume the Group has the necessary office and equipment space.
Assume the Group has the necessary supplies once the DME is purchased.
Assume that the FGP need only cover 5% of the cost of the MRI machine.
Assume that the revenue from a FGP is $2,000.
Assume that the revenue from a MRI of the prostate is $5,000.
Describe clearly any other assumptions that you make.

You are to prepare a revenue and cost analysis (in Table form).

Reference no: EM131404788

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