Departmental Costing and Cost Allocation
Ure the following info for questious 7-w14 St. Vincent'. Hospital has three support departments and four patient service departments. The direct cost to each of the support departments are as follows: General Administration $8,000,000 Maintenance $5,000,000 Employee Benefits $6,000,000 Selected data for the three support and four patient service departments are shown below: # of Full-Time Patient Services Space Salary Department Equivelent Revenues (square feet) Dollars Employees Support General Administration Maintenance Employee Benefits Total 8,000 10,000 7,000 235.000 15 75 50 $ 2,500,000 $ 3,500,000 $3,000,000 9.000.000 Patient Services Routine Care Intensive Care Obstetrics Services Other Services Total Grand Total $ $ $ $ 40,000,000 7.000.000 4,000,000 12.000.000 63.000.000 63.000.000 500.000 45.000 35.000 200.000 730.000 SO5.000 300 $ 18,000,000 200 $ 6,000,000 150 $ 4,000,000 400 $ 8.000.000 1.550 $ 36,000,000 1.690 $145,000,000 $ $ #7). Use the information for St. Vincent's Hospital. Assume that the hospital uses the direct method for cost allocation. Furthermore, the costs driver for general administration is patieni services reverus, the cost driver for maintenance is space utilization, and the cost driver for employee benefits is the number of full-time equivalent employees. What is the allocation rate for General Administration Hinc Fust, determine the cost driver for General Administration Second, then divide the cost pool by the cost driver. That is the allocation rate. #8). Use the information for St. Vincent's Hospital. Assume that the hospital uses the direct method for cost allocation Furthermore, the costs driver for general administration is patient services revenue, the cost driver for maintenance 15 space utilization, and the cost driver for employee benefits the number of full-tiune equnvalent employee: What is the allocation rate for Employee Benefits. Hint First, determine che cest driver for Employee Benefits. Second, then divide the cost pool by the cost driver. That is the allocation rete. #9). Use the information for St. Vincent'. Hospital. Assume that the hospital uses the direct method for cost allocation. Furthermore, the costs driver for general administration is patient services revenue, the cost driver for maintenance is space utilization, and the cost driver for employee benefits is the number of full-time equivalent employees. What is the total of indirect costs allocated to Intensive Care? Hinc You have already caloulated two of the three allocation rates. Once you finish the remaining rate - then you can allocate dhe cost pools to the Patient Service departments. Create a rable to allocate all the costs to all the areas. #10). Use the information for St. Vincent's Hospital. Assume that the hospital uses the direct method for cost allocation. Furthermore, the costs driver for general administration is patient services revenue, the cost driver for maintenance is space utilization, and the cost driver for employee benefits is the number of full-time equivalent employees. What is the total of indirect costs allocated to Obstetrics Services? Hint: You have already calculated neg of the three allocation rates. Once you finish the remaining rate - then you can allocate the cost pools to the Patient Service departments. Create a rable to allocate all the costs to all the areas. #11). Use the information for St. Vincent': Hospital. Assume the hospital uses salary dollars as the costs driver for general administration and employee benefits, and space utilization as the cost driver for maintenance. What is the allocation rate for Maintenance? Hinc: Caution-Do of the underlying assumptions have changed. You will need to recalculate - this problem. Make sure you read everything carefully. #12). Use the information for St. Vincent's Hospital. Assume the hospital uses salary dollars as the costs driver for general administration and employee benefits, and space utilization as the cost driver for maintenance. What is the allocanon rate for Employee Benefit:? Hinc Caution-ewo of the underlying assumptions have changed. You will need to recalculats - this problem. Make sure you read everything carefully. #13). Use the information for St. Vincent's Hospital. Assume the hospital uses salary dollars as the costs driver for general administration and employee benefits, and space utilization as the cost driver for maintenance. What is the total of indirect costs allocated to Routine Care? Hinc You have already calculated all of the allocation rates. Once you finish the remaining rats - then you can allocate che cost pools to the Patient Service departments. Create a table to allocate all che costs to all the areas. #14). Use the information for St. Vincent's Hospital. Assume the hospital uses salary dollars as the costs driver for general administration and employee benefits, and space utilization as the cost driver for maintenance. What is the total of indirect costs allocated to Other Services Hind: You have already calculated all of the allocation rates. Once you finish the remaining then you can allocate the cost pools to the Patient Service departments. Create a table to allocate all the costs to all de areas. rate
