Kourtney Lee, the director of the clinic, is keen on determining the cost of each department. Lee compiles the following data describing employee allocations to individual programs: Urgent Care Living Well Total Physicians 3 1 4 X-ray technicians 2 2 Nurses 4 8 12 Nutritionist 1 1 Print Done East Side Medical Associates operates a walk-in medical clinic in Tempe, Arizona. (Click the icon to additional information.) Lee has recently become aware of activity-based costing as a method to refine costing systems. She asks her accountant, Abe Reed, how she should apply this technique. Reed obtains the following budgeted information for 2020: (Click the icon to view the budget data.) Read the requirements. Data table Urgent Care Living Well Total Square feet of clinic space 8,000 12,000 20,000 Patient visits 20,000 18,000 38,000 Number of laboratory tests 17,000 2,000 19,000 Print Done - More info The clinic includes two different departments, Urgent Care, which serves patients with minor to moderate acute illnesses and injuries, and Living Well, which administers vaccines, school and work physicals, and conducts workshops on healthy living topics. The center's budget for 2020 follows. Professional salaries: 4 physicians $ 180,000 $ 720,000 2 X-ray technicians * $ 90,000 180,000 12 nurses * $ 130,000 1,560,000 90,000 1 nutritionist $ 90,000 $ 2,550,000 Medical supplies Rent and clinic maintenance Laboratory services 380,000 260,000 418,000 437,000 General overhead, including administrative staff Total Kourtney Lee, the director of the clinic, is keen on determining the cost of each department. Lee compiles the following data describing employee allocations to individual programs: $ 4,045,000 Print Done - Requirements 1. a. Selecting cost-allocation bases that you believe are the most appropriate for allocating indirect costs to departments, calculate the budgeted indirect cost rates for medical supplies, rent and clinic maintenance, laboratory services, and general overhead. b. Using an activity-based costing approach to cost analysis, calculate the budgeted cost of each department and the budgeted cost per patient visit of each department. c. What benefits can East Side Medical Associates obtain by implementing the ABC system? 2. What factors, other than cost, do you think East Side Medical Associates should consider in allocating resources to its departments? Print Done