Question
PLEASE HELP!!! I am having difficulties with the following two part chapter review problem: Use the following data to answer the question 6.3 (a&b): PLEASE
PLEASE HELP!!! I am having difficulties with the following two part chapter review problem:
Use the following data to answer the question 6.3 (a&b): PLEASE NOTE THAT THE CHART BELOW DOES NOT LINE UP PROPERLY WHEN I SUBMIT THE QUESTION, NOTE THAT I SUBMITTED THIS QUESTION A FEW TIMES. THE FIRST 4 LINE TOTALS SHOULD START WITH $0.00 FOR THE PATIENT SERVICES REVENUE AND THEN MOVE TO THE RIGHT TO SQUARE FEET AND SO ON. PLEASE HELP! I NEED TO FIGURE THIS OUT BEFORE MIDNIGHT! I CAN PAY MORE BASED ON THE COMPLEXITY OF THE PROBLEMS. THANK YOU.
St. Benedict's Hospital has three support departments and four patient services departments.The direct cost to each of the support departments is as follows:
General Administration $2,000,000
Facilities $5,000,000
Financial Services $3,000,000
Selected data for the three support and four patient service departments are shown below:
DepartmentPatient Services RevenueSquare feetHousekeeping Labor HoursSalary dollars
Support:
General Admin$0.00 10,000$2,000 $1,5000,000
Facilities$0.0020,000 $45,000$3,000,000
Financial Services $0.00 15,000 $3,0002,000,000
Total 45,000 $10,000 $6,500,000
Patient Services:
Routine Care $30,000,000 400,000 $150,000 $12,000,000
Intensive Care$4,000,00040,000 $30,000$5,000,000
Diagnostic Services$6,000,000 60,000 $15,000$6,000,000
Other Services $10,000,000 100,000$25,000 $7,000,000
Total $50,000,000 600,000 220,000 $30,000,000
GRAND TOTAL: $50,000,000 645,000 230,000 $36,500,000
6.3 Assume that the hospital uses the direct method for cost allocation. Furthermore, the cost driver for general administration and financial services and patient services revenue, while the cost driver for facilities is space utilization.
a.) What are the appropriate allocation rates?
b.)Use the table below to allocate the hospitals overhead costs to the patient services departments. Fill in the chart below:
Support Department Allocation Rate Routine CareIntensive CareDiagnostic Services Total
General Admin _____________ __________________________________________ _________
Facilities _____________ __________________________________________ _________
Financial Services _____________ _________________________________________ _________
Total Indirect Costs _____________ _________________________________________ __________
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