Break-even and other cvp relationships


Cedars Hospital has average revenue of $180 per patient day. Variable costs are $45 per patient day; fixed costs total $4,320,000 per year.

a. How many patient days does the hospital need to break even?

b. What level of revenue is needed to earn a target income of $540,000?

c. If variable costs drop to $36 per patient day, what increase in fixed costs can be tolerated without changing the break-even point as determined in part (a)?

Request for Solution File

Ask an Expert for Answer!!
Accounting Basics: Break-even and other cvp relationships
Reference No:- TGS0516539

Expected delivery within 24 Hours