Days of Our Lives Hospital Has Total Variable Costs of 90

Multiple Choice

Days of Our Lives Hospital has total variable costs of 90% of total revenues and fixed costs of $50 million per year. There are 50,000 patient- days estimated for next year. What is the break- even point expressed in total revenue?

A) $500 million is the break- even point.
B) $12.5 million is the break- even point.
C) $50 million is the break- even point.
D) None of these answers is correct.