Answer:
Hello your question has some missing information attached below is the missing part
University Hospital has two separate units that are part of the hospital but are two separate facilities. The first is the main hospital that performs emergency room functions, surgeries, and recovery. Separate from the main hospital is an outpatient surgery center. In an effort to control costs, some of the patients that need minor surgeries are routed to the outpatient surgery center. The outpatient surgery center treats patients in three activity centers: (1) Surgery, (2) Phase I recovery, where patients recover while the patients are still asleep, (3) Phase II recovery, where patients recover while they are awake. Phase II recovery ends when the patients go home. Daily capacities and production levels are as follows.
surgery phase i recovery phase ii recovery
Daily Capacity (surgeries) 40 30 60
Daily Production (surgeries) 30 30 30
The hospital receives an average of $1,000 per surgery. (The surgeon’s fee and the anesthesiologist’s fee are billed separately.) The variable cost per surgery is $300. There is sufficient demand for surgeries that the hospital could perform 60 surgeries per day. Surgeries not performed by the outpatient surgery center are sent to the main hospital’s regular surgery rooms. The variable cost per surgery for regular surgery in the main hospital is $700, while the hospital still receives $1,000 per surgery. The hospital management is considering the following alternatives:
answer : $32000
Step-by-step explanation:
When we remodel the problem we have to make two(2) calculations
Outpatient surgery center
Revenue from surgery = 40 * $1000 = $40000
variable cost per surgery = 40 * $300 = $12000
contribution = ( revenue - variable cost ) = $28000
cost incurred = $2000
Total = contribution - cost incurred = $26000
Regular surgery room
Revenue form surgery = 20 * $1000 = $20000
Variable cost per surgery = 20*$700 = $14000
contribution = ( revenue - variable cost ) = $6000
Therefore the Total income made by remodeling the outpatient recovery
= $26000 + $6000
= $32000