Fixed Cost = 300,000
Variable Cost = 200 per visit
Say the clinic requires X visits to break even.
Total Cost = 300000 + 200X
At the breakeven point, Total Revenue = Total Cost
Category | %age | Visits per category | Revenue per visit | Total Revenue per category |
Simple | 15% | 0.15X | 400 | 60X |
Moderate | 60% | 0.60X | 1000 | 600X |
Complex | 25% | 0.25X | 2000 | 500X |
Total Revenue = 60X + 600X + 500X = 1160X
At breakeven,
1160X = 300000 + 200X
960X = 300000
X = 312.5
Hence, clinic has to provide services to 313 patients to breakeven.
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