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McCullough Hospital uses a job-order costing system to assign costs to its patients its direct materials include a variety of items such as pharmaceutical drugs,

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McCullough Hospital uses a job-order costing system to assign costs to its patients its direct materials include a variety of items such as pharmaceutical drugs, heart valves, artificial hips, and pacemakers. Its direct labor costs feg, surgeons, anesthesiologists, radiologists, and nurses) associated with specific surgical procedures and tests are traced to individual patients. All other costs, such as depreciation of medical equipment, insurance, utilities, incidental medical supplies, and the labor costs associated with around-the clock monitoring of patients are treated as overhead costs Historically. McCullough has used one predetermined overhead rate based on the number of patient-days feach night that a patient spends in the hospitai counts as one patient-day, to allocate overhead costs to patients. Recently a member of the hospitar's accounting staff has suggested using two predetermined overhead (ates (allocated based on the number of patient-days) to improve the accuracy of the costs allocated to patients. The first overhead rate would include all overhead costs within the Intensive Care Unit. (ICU) and the second overhead rate would include all Other overhead costs Information pertaining to the hospitar's estimated number of patient-days. its estimated overhead costs, and two of its patients - Patient A and Patient B - is provided below: Required: 1. Assuming McCullough calculates fwo overhead rates as recommended by the staff accountant calculate: a. The ICU and Other hisis in tates b. The toral cost, including drect materials, direct tobor and applied ovetheed, assigned to Patient A and Patent B. 2. Assuming McCullough continues to use only one predetermined overhead rate, calculater a. The predetermined overneed rate. b. The total cost, including direct materials, direct labor and appilied overheod, assigned to Patient A and Pabent B

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