Ask Basic Finance Expert

Sales Mix Decision: Dr. Massy, who specializes in internal medicine, wants to analyze his sales mix to find out how the time of hisphysician assistant, Consuela Ortiz, can be used to generate the highest operating income.Ortiz sees patients in Dr.Massy's office, consults with patients over the telephone, and conducts one dailyweight-loss support group attended by up to 50 patients.Statistics for the three services are as follows:Office VisitsPhone CallsWeight-Loss SupportGroupMaximum numberof patient billings per day204050Hours per billing.25.101.0Billing rate$50$25$10Variable costs$25$12$5Ortiz works seven hours a day.Required1.Determine the best sales mix. Rank the services offered in order of their profitability.2.Based on the ranking inI,how much time should Ortiz spend on each service in a day? (Hint:Remember to consider the maximum number of patient billings per day.) What would be the daily totalcontribution margingenerated by Ortiz?3.Dr. Massy believes the ranking is incorrect. He knows that the daily 60-minute meeting of the weight-loss support group has 50 patients and should continue to be offered.If the new ranking for theservices is (1)weight-loss support group, (2) phone calls, and (3) office visits, how much time shouldOrtiz spend on each service in a day? What would be the total contribution margin generated by Ortiz,assuming the weight-loss support group has the maximum number of patient billings?4.Manager Insight:Which ranking would yourecommend? What additional amount of total contributionmargin would be generated if your recommendation is accepted?

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M9795580
  • Price:- $30

Priced at Now at $30, Verified Solution

Have any Question?


Related Questions in Basic Finance

Question utilizing the concepts learned throughout the

Question: Utilizing the concepts learned throughout the course, write a Final Paper on one of the following scenarios: • Option One: You are a consultant with 10 years experience in the health care insurance industry. A ...

Discussion your initial discussion thread is due on day 3

Discussion: Your initial discussion thread is due on Day 3 (Thursday) and you have until Day 7 (Monday) to respond to your classmates. Your grade will reflect both the quality of your initial post and the depth of your r ...

Question financial ratios analysis and comparison

Question: Financial Ratios Analysis and Comparison Paper Prior to completing this assignment, review Chapter 10 and 12 in your course text. You are a mid-level manager in a health care organization and you have been aske ...

Grant technologies needs 300000 to pay its supplier grants

Grant Technologies needs $300,000 to pay its supplier. Grant's bank is offering a 210-day simple interest loan with a quoted interest rate of 11 percent and a 20 percent compensating balance requirement. Assuming there a ...

Franks is looking at a new sausage system with an installed

Franks is looking at a new sausage system with an installed cost of $375,000. This cost will be depreciated straight-line to zero over the project's five-year life, at the end of which the sausage system can be scrapped ...

Market-value ratios garret industries has a priceearnings

(?Market-value ratios?) Garret Industries has a? price/earnings ratio of 19.46X a. If? Garret's earnings per share is ?$1.65?, what is the price per share of? Garret's stock? b. Using the price per share you found in par ...

You are planning to make annual deposits of 4440 into a

You are planning to make annual deposits of $4,440 into a retirement account that pays 9 percent interest compounded monthly. How large will your account balance be in 32 years?  (Do not round intermediate calculations a ...

One year ago you bought a put option on 125000 euros with

One year ago, you bought a put option on 125,000 euros with an expiration date of one year. You paid a premium on the put option of $.05 per unit. The exercise price was $1.36. Assume that one year ago, the spot rate of ...

Common stock versus warrant investment tom baldwin can

Common stock versus warrant investment Tom Baldwin can invest $6,300 in the common stock or the warrants of Lexington Life Insurance. The common stock is currently selling for $30 per share. Its warrants, which provide f ...

Call optionnbspcarol krebs is considering buying 100 shares

Call option  Carol Krebs is considering buying 100 shares of Sooner Products, Inc., at $62 per share. Because she has read that the firm will probably soon receive certain large orders from abroad, she expects the price ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As