Assume that a certain nursing home has two categories of payers. Medicaid pays las $60.00 per day and private pay patients pay the established per diem, but approximately 10 percent of private pay charges are not collected. If 50 percent of the patients are Medicaid and 50 percent are private pay, what rate must be set to rep generate $150,000 in profit? Variable costs are $45.00 per day and fixed costs are expected to be $1,000,000. Expected volume is 50,000 patient days. Using this data and assuming that the nursing home charges $100 per day, what would be the nursing home's required volume (in patient days) in order to make $150,000 profit
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Assume that a certain nursing home has two categories of payers. Medicaid pays las $60.00 per day and private pay patients pay the established per diem, but approximately 10 percent of private pay charges are not collected. If 50 percent of the patients are Medicaid and 50 percent are private pay, what rate must be set to rep generate $150,000 in profit? Variable costs are $45.00 per day and fixed costs are expected to be $1,000,000. Expected volume is 50,000 patient days.
Using this data and assuming that the nursing home charges $100 per day, what would be the nursing home's required volume (in patient days) in order to make $150,000 profit?
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