In the past, Casiopia Hospital allocated all of its overhead costs to patients based on nursing time. Casiopia has decided to switch to an activity based costing system using three activity cost pools. Information related to the new system is as follows:

	Activity Cost Pool	Activity Measure	Estimated Overhead Cost	Estimated Activity
	Registration...............	Number of patients	$75,000	1,000	patients
	Patient care...............	Nursing time	$900,000	150,000	hours
	Billing.......................	Number of bills	$120,000	2,500	bills

Data concerning two patients follows:

	Patient	Nursing time	Number of bills
	Wells.........................	100 hours	2
	Muncie......................	60 hours	3

1. Under the new activity-based costing system, how much overhead cost would be assigned to each patient?

Wells/Muncie

$771/$579

$730/438

$696/$504

$723/483

2. To determine a price for its services, Casiopia Hospital takes the total cost assigned to a patient and multiplies that number by two. Compared to the old system, which patients above will be charged more under the new activity-based costing system?

Muncie

neither patient will be charged more

Wells

both Wells and Muncie