Case Study –
Bridgestone Behavioral Health Center: CVP Analysis for Planning and Control
Case Study –
Bridgestone Behavioral Health Center: CVP Analysis for Planning and Control

MEMO
To: Dr. Thomas Russell, Executive Director, Bridgestone Behavioral Health Center
From: Sheryl Marshall, Service Consulting Plus, LLC.
Date: 8th September 2014
Subject: Financial performance of Bridgestone Behavioral Health Center over the next one year.

Dear Dr. Russell,
After having done a detailed study of the projected financial statements for the upcoming year, we have been able to identify a few glaring financial pitfalls the center has to beware of. The center has a lot of government aid provided to it but it also faces a host of challenges as the government has put various limits and caps on its volume and performance. These are the key features to be looked at when analyzing Bridgestone’s financial capabilities:- * The company receives Medicaid from various sources to facilitate its services. Key sources include the state government and certain private pay customers. * The projected budget indicates a certain level of volume which must be achieved for meager profits or breakeven. * The various facilities provided by the company include both on-campus and off-campus services, the major ones being – Group Counselling and Ambulatory Detoxification.
The center’s financials show that it is just staying afloat for the past three years, despite exemplary staff performance and glowing clientele reports. The projected financials show the targeted sales and revenue of the company for the entire next year, which means that the Bridgestone has set a target for itself based on the need for a solution that brings the center out of the risk range. In the present situation, even a slight change in operations could put the center into losses.
After an in-depth