n the $$Theme set$-$up$$ and $$Theme wrap$-$up$$ sections of chapters $3$ and $4,$ the textbook introduced us to Big Sky Dermatology Specialists and also to its practice manager, Jen Latimer. According to the scenario presented in the book, Big Sky Dermatology Specialists is a small group practice in Jackson, Wyoming. The city is located in the scenic Jackson Hole Valley and is a major gateway to the Grand Teton and Yellowstone National Parks. Jen Latimer, a recent graduate of Idaho State University$$s healthcare administration program, was just hired to be Big Sky$$s practice manager.

In chapter $5($Pricing Decisions and Profit Analysis$),$ Jen conducts a profit analysis for Big Sky$,$ which is replicated in the excel file below:

$($To get a better understanding of the scenario, read the $$Theme set$-$up$$ and $$Theme wrap$-$up$$ sections of chapter $5.)$

asi$3-$calculation$-$Jen.xlsx Download asi$3-$calculation$-$Jen.xlsx

This excel file is for your understanding only. Review this file to understand how the profit analysis was done by Jen. Your task for assignment #$3$ is to do the same calculations that Jen did, with different numbers. $($See the questions below$)$

Questions

Suppose the variable cost rate is actually $$25$ rather than $$15.$ What will be Big Sky$$s profit? Assume that the fixed cost is $$850,000,$ volume is $10,000$ visits and revenue per patient visit is $$160.$

If the volume is $15,000$ visits instead of $10,000$ but all other conditions remain the same as question $1,$ what will be the profit?

Your assignment

Your assignment is to answer questions $1$ and $2,$ using the excel template provided below.

Excel Template

Use the following excel template to complete your assignment. The excel file is set$-$up in such a way that you only need to plug$-$in the correct values into the cells highlighted with yellow; the results will be automatically calculated.

asi$3-$calculation$-$Student Template.xlsx Download asi$3-$calculation$-$Student Template.xlsx

Download the file, do your calculations in it $($or fill$-$in cells as necessary$)$ and then upload as your submission. No need to add any additional sheet to the excel file. No need to submit any additional doc or pdf file. If you need to write something, you can write in the existing sheet of the excel file.

These are fairly simple calculations that can be done with pen and paper $($& a calculator$)$; however, I strongly encourage you to use Excel. When we will move into more complex calculations in later chapters, Excel will be of great help.