D Question 18 Refer to the case facts contained in the St George Hospital case (previously distributed and provided in the supplementary materials). Provided below is a partially completed flexible budget [building on the static budget in Table 2 of the case] for the Orthopedic Unit at St George Hospital. ST GEORGE HOSPITAL ORTHOPEDIC UNIT (IN THOUSANDS, EXCEPT FOR [WACU] VOLUMES) Budget Funds Received Hips Knees Total Funds Received Variable Costs (hips) Hips Medical Hips Theatre Variable Costs (knees) Knees Medical Knees Theatre Total Variable Costs Contribution Margin Fixed Costs Hospital & Admin Other Total Fixed costs Net Income Volume Of activity 2,132 10,645 2,288 11,424 4,420 22,069 500 1,525 $ 1,892 259 2,497 7,614 3,826 2,206 16,143 5,926 3,661 1,042 4,703 1,223 Volume Variance $ Flexible Budget $ a b C Price & Efficiency /Cost Variance $ Actual Volume of activity 650 1,494 $ 2,281 11,390 2,425 12,109 4,706 23,499 1,039 257 3,245 7,461 22 pts 4,018 2,164 16,888 6,611 4,240 2,117 6,357 254 A. I. Demonstrate your understanding of flexible budgeting by calculating the numbers applicable for the highlighted cells (labelled a, b and c above) for the Orthopedic Unit of St George Hospital. 5 marks II. How might St George Hospital make best use of the flexible budget? Provide ONE clear use. 3 marks . B. Using the St George Hospital case facts, identify TWO likely key influences (evident from the case) on the achievement of budget targets for the Hospital. 4 marks C. Vera was very pleased when she was sent on her first professional development accounting seminar. She attended a number of presentations relating to time-driven-activity-based costing (TDABC) and spent considerable time reading an article by Kaplan & Porter (2011) titled How to solve the cost crisis in healthcare. She now wondered if the Orthopedic Unit would be a suitable setting for the application of TDABC. Provide ONE argument in support of the use of TDABC in the Orthopedic unit; and ONE argument against the use of TDABC in the Orthopedic unit. Your response must relate to the Orthopedic Unit and provide sufficient detail to convey each argument. 6 marks. D. Vera was starting to grow in confidence in her role. The senior staff of the Orthopedic Unit and the Hospital in general were very impressed with her enthusiasm and ability to tap into contemporary management accounting ideas and practices. Drawing on our work across the subject this semester, suggest ONE additional practice Vera could seek to introduce within the Orthopedic Unit or Hospital generally, that could enhance performance from both an accounting and quality of care perspective. Briefly comment on how your suggestion would benefit performance from these two perspectives. 4 marks