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i need problem 6.5 please. it is related to 6.4 me that the hospital uses salary dollars as the cost driver for general administration, housekeeping
i need problem 6.5 please. it is related to 6.4
me that the hospital uses salary dollars as the cost driver for general administration, housekeeping labor hours as the cost driver for facilities patient services revenue as the cost d for financial services. (The majority of the costs of the facilities department stem from the provision of housekeeping services.) 64 What are the appropriate allocation rates? Use allocation table similar to the one used for Problem 6 b. to allocate the hospital's overhead costs to the patient services departments are the dollar allocations with those obtained in Problem C. 6.3. Explain the differences. d Which of the two cost driver schemes is better? Explain your answer. 65 (Hint: The step-down method of cost allocation, reviewed in this problem, is covered in detail in the Chapter 6 Supplement.) Now assume that the hospital uses the step-down method for cost allocation, with salary dollars as the cost driver for general administration, housekeeping labor hours as the cost driver for facilities, and patient services revenue as the cost driver for financial services. Assume also that the general administration department provides the most services to other support departments, followed closely by the facilities department. The financial services department provides the least services to the other support departments. a. Use an allocation table to allocate the hospital's overhead costs to the patient services departments. b. Compare the dollar allocations with those obtained in Problem 6.4. Explain the differences Is the direct method or the step-down method better for cost allocation within St. Benedict's? Explain your answer 66 ReturnStep by Step Solution
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