On August 1, 20Y7, Dr. Ruth Turner established SickCo, a medical practice organized as a professional corporation. The following conversation occurred the following February between Dr. Turner and a former medical school classmate, Dr. Shonna Rees, at an American Medical Association convention in New York City.
Dr. Rees: Ruth, good to see you again. Why didn’t you call when you were in Denver? We could have had dinner together.
Dr. Turner: Actually, I never made it to Denver this year. My husband and kids went up to our Vail condo twice, but I got stuck in Fort Lauderdale. I opened a new consulting practice this August and haven’t had any time for myself since.
Dr. Rees: I heard about it ... Sick... something ... right?
Dr. Turner: Yes, SickCo. My husband chose the name.
Dr. Rees: I’ve thought about doing something like that. Are you making any money? I mean, is it worth your time?
Dr. Turner: You wouldn’t believe it. I started by opening a bank account with $45,000, and my January bank statement has a balance of $100,000. Not bad for six months—all pure profit.
Dr. Rees: Maybe I’ll try it in Denver! Let’s have breakfast together tomorrow and you can fill me in on the details.
Comment on Dr. Turner’s statement that the difference between the opening bank balance ($45,000) and the January statement balance ($100,000) is pure profit.