Medical Cinic operates a cardiology care unit and a maternity care unit. Colby Hepworth, the dinic's administrator, is assigned to cardiology patients, Currently, all cardiology patients are charged the same rate per patient day for daily care services. Daily car broadly defined as occupancy, feeding, and nursing care. A recent study, however, revealed several interesting outcomes. First, the demands patients place on daily care services vary with the severity of the case being treated. Second, the occupancy activity is a combination of two activities: lodging and use of monitoring equipment. Since some patients require more monitoring than others, these activities should be separated. Third, the daily rate should reflect the difference in demands resulting from differences in patient type. Separating the occupancy activity into two separate activities also required the determination of the cost of each activity. Determining the costs of the monitoring activity was fairly easy because its costs were directly traceable. Lodging costs, however, are shared by two activities: lodging cardfology patients and lodging maternity care patients. The total lodging costs for the two activities were $5,958,000 per year and consisted of such items as building depreciation, building maintenance, and building utilitles. The cardiology floor and the maternity floor each occupy 21,200 square feet. Hepwor the charges th determined that lodging costs would be assigned to each unit based on square feet. fference in demands, patients were placed in three categories according to illness severity, and the following annual data were collected: Activity Lodging Monitoring Feeding Nursing care Cost of Activity Activity Driver Patient days 21,410 s 642,300 2,167,460 Monitoring hours used 29290 21,410 406,790 Patient days 4,358,000 Nursing hours 7,574,550 217,900 252 PM /16/2019 Nursing care 4,358,000 Nursing hours 217,900 Total The demands associated with patient severity are also provided: Severity Patient Days Monitoring Hours Nursing Hours High Medium Low Required: 1. Suppose that the costs of daily care are assigned using only patient days as the activity driver (which is also the measure of output). Compute the dally rate using this unit-based approach of cost assigniment. If required, round your answer to the nearest cent. 7,230 10,260 3,920 14,560 11,520 3,210 133,000 72,000 12,900 per day 2. Compute activity rates using the given activity drivers (combine activities with the same driver). If required, round your answers to the nearest cent Rate 1, Rate 2 per patient day per monitoring hour per hour of nursing care a. compute the charge per patient day for each patient type using the activity rates from Requirement 2 and the demands on each activity. Round your interim calculations and final answers to the nearest cent. Rate 3 per patient day High severity 253 PM Ef eBook High Mediurn Low Required: 7,230 10,260 3,920 14,560 11,520 3,210 133,000 72,000 12,900 1. Suppose that the costs of daily care are assigned using only patient days as the activity driver (which is also the measure of output). Compute the daily rate using this unit-based approach of cost assignment. If required, round your answer to the nearest cent. per day 2. Compute activity rates using the given activity drivers (combine activities with the same driver). If required, round your answers to the nearest cent. Rate 1 per patient day per monitoring hour ) per hour of nursing care Rate 3 ute the charge per patient day for each patient type using the activity rates from Requirement 2 and the demands on each activity. Round your interim calculations and final answers to the nearest cent. High severity Medium severity Low severity per patient day per patient day per patient day 254 PM t
