question 1: Crosswinds Hospital plans to use activity-based costing to assign hospital indirect costs to the care of patients. The hospital has identified the following activities and activity rates for the hospital indirect costs:

Activity Activity RateRoom and meals$170per dayRadiology$240per imagePharmacy$60per physician orderChemistry lab$103per testOperating room$680per operating room hour

The activity usage information associated with the two patients is as follows:

Abel PutinCheryl UmitNumber of days4days8daysNumber of images5images8imagesNumber of physician orders4orders6ordersNumber of tests4tests7testsNumber of operating room hours2hours6.5hours

a. Determine the activity cost associated with each patient.

Abel Putin$fill in the blank 1Cheryl Umit$fill in the blank 2

b. Why is the total activity cost different for the two patients?: (Abel Putin/Cheryl Umit) apparently had a different condition that required more extensive treatment. Thus, the activity cost to (Abel Putin/Cheryl Umit) is more than the activity cost of the other patient.

Question 2. Lonsdale Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows:

ActivityBudgeted Activity Cost Activity BaseCasting$250,120 Machine hoursAssembly186,490 Direct labor hoursInspecting35,140 Number of inspectionsSetup36,180 Number of setupsMaterials handling35,700 Number of loads

Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow:

Activity BaseEntryDiningTotalMachine hours5,100 4,520 9,620 Direct labor hours4,390 6,580 10,970 Number of inspections1,910 600 2,510 Number of setups220 50 270 Number of loads670 180 850 Units produced10,200 5,100 15,300

activity rates:

casting= $26

assembly= $17

inspecting =$14

setup= $134

materials handling= $42

b. Use the activity rates to determine the total and per-unit activity costs associated with each product. Round the per unit amounts to the nearest cent.

ProductTotal Activity CostActivity Cost Per UnitEntry Lighting Fixtures Dining Room Lighting Fixtures