Question: A. The variable cost per gift basket is $2; fixed costs are $5,000 per month, and the selling price of a basket is $7. How

A. The variable cost per gift basket is $2; fixed costs are $5,000 per month, and the selling price of a basket is $7. How many baskets must be produced and sold in a month to earn a pretax profit of $1,000?

B. The Community Clinic (a not-for-profit medical clinic) received a lump-sum grant from the City of Tucson of $460,000 this year. The fixed costs of the clinic are expected to be $236,000. The average variable cost per patient visit is expected to be $7.64 and the average fee collected per patient visit is $4.64. What is the breakeven volume in patient visits?

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