$Dr.$ Jones $is$ deciding $on$ whether $to$ open a Surgery Center. $He$ estimates that the annual Fixed Overhead costs for the center will $be$ $$100,000.He$ also estimates that $he$ will have $$75,000is$ fixed staffing costs. $Dr.$ Jones accountant has told him that his variable costs will $be$ $$250$ per surgical case $in$ staffing costs, plus $an$ additional $$75$ per case $in$ medical supplies. $In$ studying the fee schedules $of$ Medicare and Blue Cross, $Dr.$ Jones feels that $he$ will earn approximately $$750$ per case based $on$ both the payer mix and types $of$ procedures $he$ will $be$ performing.

What $isDr.$ Jones$$ incremental profit per case?

Based $on$ the information given, what volume $of$ cases does $Dr.$ Jones need $to$ have $in$ order $to$ break$-$even?

$Dr.$ Smith $is$ deciding $on$ whether $to$ open a new clinic. $He$ estimates that the annual Fixed Overhead costs for the center will $be$ $$200,000.He$ also estimates that $he$ will have $$100,000is$ fixed staffing costs. $Dr.$ Smith$s$ office manager has told him that his variable costs will $be$ $$15$ per patient $in$ staffing costs, plus $an$ additional $$5$ per case $in$ medical supplies. $In$ studying the fee schedules $of$ Medicare and Blue Cross, $Dr.$ Smith feels that $he$ will earn approximately $$100$ per case based $on$ both the payer mix and types $of$ patient visits $he$ will $be$ seeing.

What $isDr.$ Smith$s$ incremental profit per case?

Based $on$ the information given, what volume $of$ cases does $Dr.$ Smith need $to$ have $in$ order $to$ break$-$even?

$Dr.$ Smith$s$ office manager has told him $he$ will need $to$ clear $an$ additional $$150,000of$ cash flow $(above$ break$-$even$)in$ order $to$ pay the debt service $on$ the cost $of$ the equipment and yield the required return $on$ the investment. What volume $of$ cases does $Dr.$ Smith need $todoto$ meet this target? What $is$ the average cost per case $at$ this volume?

$Dr.$ Jones$$ accountant has told him $he$ will need $to$ clear $an$ additional $$200,000of$ cash flow $(above$ break$-$even$)in$ order $to$ pay the debt service $on$ the cost $of$ the equipment and yield the required return $on$ the investment. What volume $of$ cases does $Dr.$ Jones need $todoto$ meet this target? What $is$ the average cost per case $at$ this volume?