Lakespring Retirement Village is home to senior citizens who are fairly independent but need assistance with basic health care and occasional meals. Jill Thompson, a licensed beautician, works on salary 16 hours a week at Lakespring. Funds at the retirement village have been getting tight due to an increase in the number of Medicaid and other low-income residents. Carl Jones, Lakespring’s administrator, told Thompson that the hair salon might have to be closed. Jones is sympathetic because he knows that it will be inconvenient for many residents to get this service elsewhere, and Thompson’s charges are about all the residents can afford, but he wonders how he can keep any unit open that does not break even. Jones
|
Hair Cuts |
Permanents |
Brief Visits |
|
|
Charge per resident |
$10.00 |
$20.00 |
$5.00 |
|
Variable costs per service performed |
$1.00 |
$4.00 |
$3.50 |
|
Cleaning/styling/setting products |
|||
|
Variable water expense |
$0.15 |
$0.25 |
$0.25 |
|
Laundry expenses for towels, smocks, etc. |
$0.10 |
$0.30 |
$0.30 |
is looking for a way to save the hair salon and has provided the following information: