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... 5-36 Reston's Radiology Center (RRC) performs X-rays, ultrasounds, computer tomography (CT) scans, and magnetic resonance imaging (MRI). RRC has developed a reputation as a
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5-36 Reston's Radiology Center (RRC) performs X-rays, ultrasounds, computer tomography (CT) scans, and magnetic resonance imaging (MRI). RRC has developed a reputation as a top radiology center in the state. RRC has achieved this status because it constantly reexamines its processes and procedures. RRC has been using a single, facility-wide overhead allocation rate. The vice president of finance believes that RRC can make better process improvements if it uses more disaggregated cost information. She says, "We have state-of-the-art medical imaging technology. Can't we havestate-of-the-art accounting technology?" Reston's Radiology Center Budgeted Information for the year Ended May 31, 2017 UltrasoundCT scan Tetal Technician labor $ 98.065 145,000 S 209 320 140.000 $ 592.385 160,800 246,000 377,200 716,000 1,500,000 23,800 31200 270,000 288,192 134,190 407,000 S 610.320 887 200 $ 2,896,547 Number of procedures Minutes to clean after each procedue Minutes for each procedure 3.168 20 15 2.988 2.664 30 50 10 20 RRC operates at capacity. The proposed allocation bases for overhead are: Administration Maintenance (including parts) Capital cost of the equipment (use Depreciation) Number of procedures Total cleaning minutes Total procedure minutes Data TableStep by Step Solution
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