Phoenix Medical Associates operates a walk-in medical clinic in Tempe, Arizona. (Click the icon to additional information.) Lee has recently become aware of activity-based costing as a method to refine costing systems. More info The clinic includes two different departments, Urgent Care, which serves patients with minor to moderate acute illnesses and injuries, and Living Well, which administers vaccines, school and work physicals, and conducts workshops on healthy living topics. The center's budget for 2020 follows. Professional salaries: 4 physicians ting i * $ 170,000 $ 680,000 2 X-ray technicians $ 130,000 260,000 12 nurses 1 nutritionist $ 160,000 $ 130,000 1,920,000 130,000 Medical supplies $ 2,990,000 420,000 st cer Rent and clinic maintenance 286,000 Laboratory services 323,000 General overhead, including administrative staff Total Kara Lee, the director of the clinic, is keen on determining the cost of each department. Lee compiles the following data describing employee allocations to individual programs: 672,000 $ 4,691,000 Urgent Care Living Well Total Physicians 3 1 4 X-ray technicians 2 2 Nurses 10 2 12 Nutritionist 1 1 Requirements She asks her accountant, Ken Reed, how she should apply this technique. Reed obtains the following budgeted information for 2020: (Click the icon to view the budget data) 1. a. Selecting cost-allocation bases that you believe are the most appropriate for allocating indirect costs to departments, calculate the budgeted indirect cost rates for medical supplies, rent and clinic maintenance, laboratory services, and general overhead. b. Using an activity-based costing approach to cost analysis, calculate the budgeted cost of each department and the budgeted cost per patient visit of each department. c. What benefits can Phoenix Medical Associates obtain by implementing the ABC system? 2. What factors, other than cost, do you think Phoenix Medical Associates should consider in allocating resources to its departments? nic maintenance, laboratory services, and general overhead. al overhead, including administrative staff; sq ft = square foot.) Print Done - X cost of each depa Urgent Care Living Well Total for the Living We Square feet of clinic space 11,000 15,000 26,000 st per patient visit amounts to the nearest Patient visits 17,000 25,000 42,000 Number of laboratory tests 12,000 7,000 19,000 Print Done