Thanks for your help!

452 CHAPTER 9 USING CULI ns, has just received the losing money for d rating. Stevens has met im to identify areas for The following informa 16. Expand-or-reduce. The administrator of ABC Hospital, Mr. Stevens, has latest financial report, and the news is not good. The hospital has been over a year, and if things don't improve, it may lose its AA bond rating, si with his vice president of finance, Mr. Sanger, and has asked him to iden cutting costs, beginning with services that are operating at a loss. The followi tion is for services provided at ABC Hospital's ambulatory care clinic: Annual volume (in patient visits) Charge per visit Variable cost per visit Fixed costs 7,000 $155 $45 $700,000 a. Suppose that all fixed costs are avoidable. What should Sanger recommend Stevens regarding dropping the clinic? b. What if only $300,000 of the fixed costs were avoidable? Would this change hiel recommendation? Are there any other considerations that should be taken into account when making this decision