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In the class sessions and within the textbooks, it was explained that cost is a term which applies to the financial value of a cost
In the class sessions and within the textbooks, it was explained that cost is a term which applies
to the financial value of a cost object within the operation of the healthcare services organization,
and the manager should understand how to classify the operational costs of the organization, how
to use those classifications in managing the costs in hisher responsibility center, and how to
allocate the costs involving direct and indirect costs to determine the cost of providing a particular
service or other cost object. In that regard, please provide the following:
a Define the term of cost object give two examples with an explanation of which direct,
indirect, variable and fixed costs must be taken into account to determine the total cost of the
cost object, and explain the significance of identifying the cost object when managing the
operational costs associated with the responsibility center and the healthcare services
organization.
b Define the classifications of the costs in the operation of the healthcare services organization,
give two examples of each classification, and explain how the manager should consider each
classification when making decisions within the responsibility center and the healthcare
services organization.
c Define the methods for allocating costs within the healthcare services organization, and
provide at least three examples for allocating the costs from supportive cost responsibility
centers for determining the cost of providing services in a revenue responsibility center
indicating the unit of measurement used for the cost allocation
See Chapter Harrington; Chapters and Bakerplease give citations and refrences and explain in detail
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