With the population aging and patients who dread sitting in asterile dental office, dentists are finding an opportunity in dentalhouse calls. The Blende Dental Group has taken its service onthe road in San Francisco and New York City, performing everything from routine exams and cleanings to root canals. Some patients are wealthy and prefer the personal service, whereas othersare elderly homebounds who cannot get out to the dentist’soffice. Recreating a dental office in a home requires additionalequipment, such as a portable X-ray machine that looks like aray gun, sterile water tanks, a dental drill, lights, and a laptop. Aportable X-ray machine alone costs $8,000. Refer to Appendix3: Marketing by the Numbers to answer the following questions. 1. What types of fixed costs are associated with this service? 2. Assuming fixed costs of adding this mobileservice will increase by $20,000 and a desired contribution margin of 40 percent, determine the amount ofsales necessary to break even on this increase in fixedcosts to offer this additional service.3. What other factors must a dentist consider before offering this service in addition to his or her in- officeservice?
With the population aging and patients who dread sitting in a
sterile dental office, dentists are finding an opportunity in dental
house calls. The Blende Dental Group has taken its service on
the road in San Francisco and New York City, performing everything from routine exams and cleanings to root canals. Some patients are wealthy and prefer the personal service, whereas others
are elderly homebounds who cannot get out to the dentist’s
office. Recreating a dental office in a home requires additional
equipment, such as a portable X-ray machine that looks like a
ray gun, sterile water tanks, a dental drill, lights, and a laptop. A
portable X-ray machine alone costs $8,000. Refer to Appendix
3: Marketing by the Numbers to answer the following questions.
1. What types of fixed costs are associated with this service?
2. Assuming fixed costs of adding this mobile
service will increase by $20,000 and a desired contribution margin of 40 percent, determine the amount of
sales necessary to break even on this increase in fixed
costs to offer this additional service.
3. What other factors must a dentist consider before offering this service in addition to his or her in- office
service?
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