East Valley Hospital is a primary medical care facility and trauma center that serves 11 small, rural midwestern communities within a 40-mile radius. The hospital offers all the medical/surgical services of a typical small hospital. It has a staff of 18 full-time doctors and 20 part-time visiting specialists. East Valley has a payroll of 150 employees consisting of technicians, nurses, therapists, managers, directors, administrators, dieticians, secretaries, data processors, and janitors.

aUsing your (limited, moderate, or in-depth) knowledge of a hospitals operations, identify as many activities as you can that would serve as the basis for implementing an activity-based costing system.

b) For each of the activities listed in (a), identify a cost driver that would serve as a valid measure of the resources consumed by the activity.