The information in the table below applies to problems 25 and 26. Your nursing home defines output as a patient day. Its present volume is 26,000 patient days.
The average cost per day is S90.00. Present revenues and costs are presented below:
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Revenues:
Charge Patients (6,000 Patient Days) $750,000
Fixed-Price Patients (20,000 Patient Days) 1,800,000
Total Net Revenues 52,550,000
Costs:
Fixed Costs $1,170,000
Variable Costs ($45/PD) 1,170,000
Total ($90/PD) 52,340,000
Net Income $210,000
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Using this information, answer the following two questions.
What is the breakeven in patient days for this nursing home, assuming no profit is required?
If volume goes up 10 percent to 28, 600 patient days and payer mix is unchanged, what will net income be?