Product Costing and Decision Analysis for a Service Company Pleasant Stay Medical Inc. wishes to determine its product costs. Pleasant Stay offers a variety of medical procedures (operations) that are considered its "products." The overhead has been separated into three major activities. The annual estimated activity costs and activity bases follow: Activity Scheduling and admitting Housekeeping Nursing Total costs Budgeted Activity Cost $432,000 Activity Base Number of patients 4,212,000 5,376,000 $10,020,000 Number of patient days Weighted care unit Total "patient days" are determined by multiplying the number of patients by the average length of stay in the hospital. A weighted care unit (wcu) is a measure of nursing effort used to care for patients. There were 192,000 weighted care units estimated for the year. In addition, Pleasant Stay estimated 6,000 patients and 27,000 patient days for the year. (The average patient is expected to have a a little more than a four-day stay in the hospital.) During a portion of the year, Pleasant Stay collected patient information for three selected procedures, as follows: Activity-Base Usage Procedure A Number of patients 280 Average length of stay x 6 days Patient days 1,680 Weighted care units 19,200 Procedure B Number of patients Check My Work 650 Previous Next >