Assume a Cardiology private practice has the following cost structure:
Fixed cost = $400,000
Variable cost per procedure = $30
Assume the group expects to perform 8,000 procedures this year
What is the group’s underlying cost structure? ______________________________
What is the group’s expected total costs? ___________________________________
What would the estimated costs be of:
5,000 procedures? __________________________
10,000 procedures? ___________________________
What is the average cost per procedure at 5,000, 8,000 and 10,000 procedures?
5,000 = ______________________________
8,000 = ______________________________
10,000 = _____________________________
What is the breakeven number of procedures they must do if they set their price at $200 per procedure?