Assume that manager of a business are setting the price on a new service. Relevant data estimates: variable cost per visit: $5.00, Annual direct fixed costs: $500,000, Annually overhead allocation: $50,000, Expected annual utilization 10,000 visits is.
A. What per visit price must be set for the service to break even? To earn an annual profit of $100,000?
B. Repeat at a cost per visit is $10.
C. Repeat is fixed cost is $1,000,000.
D. Assuming both a $10 variable cost and $1,000,000 in direct fixed cost.