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Question - A not-for-profit clinic has the financial projections for its first year of operations. Revenue and variable costs presented are annual amounts based on the projected number of visits. Medical and administrative supplies are variable costs; all other costs are fixed costs.
Medical and administrative supplies are variable costs; all other costs are fixed costs.
Projected Visits 10,000
Revenues $400,000
Wages & benefits 220,000
Rent 5,000
Depreciation 30,000
Utilities 2,500
Medical supplies 50,000
Administrative supplies 10,000
Required -
a. Construct the clinic's projected P&L Statement.
b. What is the total contribution margin?
c. What is the contribution margin (rounded to the nearest dollar)?
d. What is the breakeven volume?
e. What is the economic breakeven for a profit of $100,000?
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