# Conduct a profit (CVP) analysis

Sep 2nd, 2015
RockCafe
Category:
Accounting
Price: \$20 USD

Question description

Assessment #2: Case Study of a health care organization’s profitability

In this assessment you will use the data provided below and conduct a profit (CVP) analysis. You will be graded based on your understanding of profit (CVP) analysis, the accuracy of your calculations, the validity of you conclusions and your ability to clearly communicate your analysis. To complete this assignment, follow these steps.

1. Assume the following information about cost and charges for a hospital in 2014:

Fixed Costs = \$10,000,000

Variable cost per inpatient Day = \$200

Charge Per Inpatient Day = \$1,000.

1. Review Nowicki Chapter 6 and Gapenski Chapter 5. From what you have learned in these chapters estimate the: a) accounting breakeven point quantity and breakeven dollar amount and b) the economic breakeven point quantity and dollar amount.
2. Explain the contribution margin.
3. Write a short paper in the following format:
1. Cover page with your name, class/section and instructor’s name
2. For each measure estimated above, in a paragraph: define the measure, explain the importance of that measure to the healthcare services manager.
3. Explain how these breakeven points would vary in a capitated and non-capitated environment.  Provide a numerical example in a table to illustrate difference.

You will be graded base on the following rubric:

 90-100 80-89 70-79 0 Points The student demonstrates a thorough understanding of the meaning of the ratios measured and their applicability to the organization being analyzed. The student demonstrates a reasonable but not complete understanding of the meaning of the ratios chosen and their applicability to the organization being analyzed. The student demonstrates a limited understanding of the meaning of the ratios chosen and their applicability to the organization being analyzed. The student does not demonstrate an understanding of the meaning of the ratios or how they can be used to assess the organization’s financial condition. All of the ratios are calculated accurately Only 2 of the ratios are calculated accurately Only 1 of the ratios are calculated accurately None of the ratios are calculated accurately. The student draws accurate conclusions for each of the ratios and for the overall financial health of the organization. The student draws some accurate conclusions for each of the ratios and for the overall financial health of the organization. There are a few mistakes The student draws few accurate conclusions for each of the ratios and for the overall financial health of the organization. There are several mistakes The student’s conclusions for each of the ratios are inaccurate and the overall conclusion on the financial health of the organization is not valid. Writing quality: Writes clearly, concisely, and with few errors. Easy to understand. Writing quality: Writes with some errors but the paper can be readily understood. Writing quality: paper includes numerous errors. Requires some effort to understand. Writing quality: The paper is poorly written and is difficult to understand.

(Top Tutor) Daniel C.
(997)
School: UCLA

Studypool has helped 1,244,100 students

## Review from our student for this Answer

Sigchi4life
Sep 6th, 2015
"The best tutor out there!!!!"

1825 tutors are online

Brown University

1271 Tutors

California Institute of Technology

2131 Tutors

Carnegie Mellon University

982 Tutors

Columbia University

1256 Tutors

Dartmouth University

2113 Tutors

Emory University

2279 Tutors

Harvard University

599 Tutors

Massachusetts Institute of Technology

2319 Tutors

New York University

1645 Tutors

Notre Dam University

1911 Tutors

Oklahoma University

2122 Tutors

Pennsylvania State University

932 Tutors

Princeton University

1211 Tutors

Stanford University

983 Tutors

University of California

1282 Tutors

Oxford University

123 Tutors

Yale University

2325 Tutors