Problem:
Super Clinics offers one service that has the following annual cost and volume estimates: variable cost per visit = $10, annual direct fixed costs = $50,000, allocation of overhead costs = $20,000, and expected volume = 1,000 visits.
Required:
Question 1: What price per visit must be set if the clinic wants to make an annual profit of $10,000 on the service? Illustrate in detail clarify all workings.
$70
$80
$90
$100
$110