+ P42.-LO.3-LO.5 (Cost drivers; ABC; analysis) Boerne Community Hospital has been under increasing pressure to be accountable for its patient charges. The hospital's current pricing system is ad hoc, based on pricing norms for the geographical area; only direct costs for surgery, medication, and other treatments are explicitly considered. The hospital's controller has suggested that the hospital improve pricing policies by seeking for services less arbitrary. As a first step, the controller has determined that most costs can be assigned to one of three cost pools. The three cost pools follow along with the estimated amounts and activity drivers. Activity Center Professional Salaries Amount $12,125,000 Activity Driver Professional hours Quantity 65,000 hours Building Costs Risk management 3,187,500 750,000 Square feet used Patients Served 46,250 sq. ft 3,500 patients The hospital provides in three broad categories. The services follow with their volume measures for the activity centers. Service Professional Hours Square Feet Number of Patients Surgery 2,750 12,500 400 Housing Patients 70,000 26,500 1,250 Outpatient Care 2,250 17,250 850 a. What bases might be used as cost drivers to allocate the service center costs among the patients served by the hospital? Defend your selections. b. The hospital currently charges as "add-on" rate calculated using professional hours to patients' direct charges. What rate is Boerne Community Hospital charging per hour? (Round to the nearest dollar.)