Sales mix decisiondr massy who specializes in internal

Reference no: EM13381804

Sales Mix DecisionDr. 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.Required

1. 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?

Reference no: EM13381804

Questions Cloud

A companys 6 coupon rate semiannual payment 1000 par value : a companys 6 coupon rate semiannual payment 1000 par value bond that matures in 25 years sells at a price of 656.95 the

Use the black scholes model to find the price for a call : use the black scholes model to find the price for a call option with the following inputs current stock price 28 strike

You are a managing partner of a prestigious investment : you are a managing partner of a prestigious investment counseling firm that specializes in individual rather than

Total market value of a company 60million during the year : total market value of a company 60million. during the year company plans to invest 30mil in new projects. based on the

Sales mix decisiondr massy who specializes in internal : sales mix decisiondr. massy who specializes in internal medicine wants to analyze his sales mix to find out how the

Subsidiary x sells 10000 units to subsidiary y annually the : subsidiary x sells 10000 units to subsidiary y annually. the marginal income tax rate for subsidiary x is 30 and the

First republic bancorp is considering the acquisition of a : first republic bancorp is considering the acquisition of a new data processing and management information system. the

Analyze the strengths and weaknesses of the coca cola : analyze the strengths and weaknesses of the coca cola company using ratio analysis and present your findings in a paper

Woidtke manufacturings stock currently sells for 22 a share : woidtke manufacturings stock currently sells for 22 a share. the stock just paid a dividend of 1.20 a share i.e. d0

User Account

All Pages