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What per visit price must be set for service to break-even

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Question - Assume that the managers of the Fort Winston Hospital are setting the price on a new outpatient service. Here are the relevant data estimates:

Variable Cost Per Visit $7.00

Annual Direct fixed Cost $700,000

Annual overhead allocation $60,000

Expected annual utilization 15,000 visits

Required - What per visit price must be set for the service to break-even? To earn an annual profit of $100,000?

Reference no: EM132504197

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