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Scenario 12

question 231

Multiple Choice

Scenario 12.4 Use the following to answer the questions.
Glenwood Pet Hospital is considering implementing a new pricing strategy for its veterinarian services. After reviewing the previous three years' revenue, Glenwood finds that most of its customers bring their pets in for the required annual vaccinations and then only if the animal is ill. Glenwood's objective is to generate more income per customer on an annual basis. The hospital has previously priced its services by charging a flat fee for the office visit, a fee for each vaccine, and a fee for each type of examination beyond the basic office visit. Most customers pay the flat office fee and a fee for a rabies vaccine. Glenwood is now considering a new plan where the pet owner would pay one fee that would cover an office visit, the required rabies vaccine, and additional vaccines that prevent heartworm, kennel-cough, and fleas. Glenwood hopes to encourage the pet owners to view their pet's health as part of a prevention program, rather than a one-time annual visit.
Refer to Scenario 12.4. Glenwood is considering a markup pricing basis, with the cost for office visit plus vaccines at $45. If Glenwood were to add a markup of 33.3 percent of the costs, its price would be ____.

Definitions:

Characterised

Described in terms of distinctive qualities or features.

Direct

In financial and business contexts, this term refers to a method or approach that involves straight interaction without intermediary channels, often used in marketing to describe direct communication or sales to customers.

NCI Allocation

Refers to the distribution of Net Current Assets among various parties or accounts, primarily focusing on how non-controlling interest (NCI) is allocated in consolidated financial statements.

Equity Account

An account that represents the owner's interest in a company's assets, typically reflecting the amount of funds that remain for the owners after all liabilities have been subtracted.