1. Business as usual (10P)
Imagine that you have been working for a large global company for 5
years. Your job description and responsibility are to compute the right cost
prices and provide the management with management information.
One day, the CFO (Chief Financial Officer) has a problem, the cost price is
due to the Ukraine war too expensive. He asks you to skip some costs and
to report a lower cost price, so the future business is guaranteed.
A. What will you do, what justify your response?
, 2. Cost-Volume-Profit at a Hospital (15P)
Children’s Hospital predicts variable costs of 70% of total revenue and
fixed costs of € 42 million per year for the coming year.
A. Compute the break-even point expressed in total revenue.
B. Children’s Hospital expects total revenue of € 150 million from 200.000
patient-days. Compute expected profit if costs behave as expected.
C. Children’s Hospital expects total revenue of € 150 million from 200.000
patient-days. Compute expected profit if variable costs were 10%
greater than predicted.
Imagine that you have been working for a large global company for 5
years. Your job description and responsibility are to compute the right cost
prices and provide the management with management information.
One day, the CFO (Chief Financial Officer) has a problem, the cost price is
due to the Ukraine war too expensive. He asks you to skip some costs and
to report a lower cost price, so the future business is guaranteed.
A. What will you do, what justify your response?
, 2. Cost-Volume-Profit at a Hospital (15P)
Children’s Hospital predicts variable costs of 70% of total revenue and
fixed costs of € 42 million per year for the coming year.
A. Compute the break-even point expressed in total revenue.
B. Children’s Hospital expects total revenue of € 150 million from 200.000
patient-days. Compute expected profit if costs behave as expected.
C. Children’s Hospital expects total revenue of € 150 million from 200.000
patient-days. Compute expected profit if variable costs were 10%
greater than predicted.
