Managerial Accounting. 1. Cost Allocation, Textbook healthcare finance 6th edition L Gapenski & K Reiter (2016)

Review the data below carefully and create a P&L for each service department showing their respective overhead costs. Use the direct method of allocation to estimate overhead for each department.

Service department	Square Feet	Revenues	Direct Costs
Imaging	325,481	$15,824,000	$10,562,487
Surgery	28,650	$23,581,497	$14,521,649
Total	354,131	$39,405,497	$25,084,136

Facilities Services $8,750,000

General

Administration $3,532,789

Total Overhead Costs $12,282,789

Total Costs $37,366,925

Projected Overall Profit $2,038,572