Mayo Clinic is using Activity-Based Costing for its healthcare services:

Requirements:

• Calculate the cost per patient using ABC:
  • Direct Costs: $1,000 per patient
  • Indirect Costs: $500 per patient

• Apply Marginal Cost Accounting to assess the cost impact of treating additional patients.
• Evaluate the advantages of ABC over Marginal Cost Accounting in healthcare cost management.
• Discuss how Standard Cost Accounting could improve budgeting for medical supplies.

Cost Calculation (ABC):

Category	Amount per Patient ($)
Direct Costs	$1,000
Indirect Costs	$500
Total Cost per Patient	$1,500