# Hospital Supply

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GSM5301 Accounting for Decision Making GROUP ASSIGNMENT (CASE 16-1 HOSPITAL SUPPLY, INC) Question 1 What is the break-even volume in units? In sales dollars? Solution 1 Variable costs per unit = \$550 + \$825 + \$420 + \$275 = \$2,070 Fixed costs per unit = \$660 + \$770 = \$1,430 Normal volume = 3,000 units Regular selling price = \$4,350 Total fixed cost = 3,000 units x \$1,430/unit = \$4,290,000 Unit contribution = price/unit – variable cost/unit = \$4,350 - \$2,070 = \$2,280 Contribution percent = \$2,280/\$4,350 = 0.524 Break-even volume in units = fixed cost / unit contribution = \$4,290,000 / \$2,280 = 1,882 units Break-even volume in sales = fixed cost / contribution percent =…show more content…
acture its hoists in-house or outsource it to a contractor, they need to assess each option in terms of total unit costs which will affect its net income as shown below: | |IN-HOUSE |OUTSOURCE | | | | | |TOTAL UNIT COST | | | | | | | | | | | | | | | |