Ridge's Radiology Centre (RRC) performs X-rays, ultrasounds, CT scans, and MRIS. RRC has developed a reputation as a top radiology centre in the area. RRC has achieved this status because it constantly reexamines its processes and procedures. RRC has been using a single, facility-wide overhead allocation rate. The VP of Finance believes that RRC can make better process improvements if it uses more disaggregated cost information. She says, "We have state-of-the-art medical imaging technology. Can't we have state-of-the-art accounting technology?" The following budgeted information is available. E (Click the icon to view the budgeted information.) (Click to ( Required i Budgeted information X Requirement 1. Calculate the budgeted cost per service for X-rays, ull Determine the formula to calculate the overhead costs allocated to ead Depreciation 32,100 272,000 437,000 892,000 1,633,100 t; then round the costs allocated to the nearest whole number.) Materials 22.100 17,000 24,100 31,500 94,700 Budgeted overh x (Total indirect costs Administration 23,500 X-Rays Maintenance Sanitation Ultrasound 244,000 199,000 133,000 $ 114,200 $ 395,500 $ 559,600 $ 1,027,500 $ 2,696,300 Utilities CT Scan 1 MRI 1 Totals X Now calculate the total budgeted costs for each service using direct te budgeted cost per service to the nearest cent.) 4,100 4,500 3,100 2,700 Number of procedures Minutes to clean after each procedure 10 10 15 35 $ X-Rays Ultrasou 60,000 $ 106 32,100 272 Technician labour Depreciation Materials 22,100 17 Print Done Done Indirect costs Total budgeted costs to eal i Additional information X then ro Overill RRC operates at capacity. The proposed allocation bases for overhead are as follows: Administration Number of procedures Maintenance (including parts) Capital cost of the equipment (depreciation) Sanitation Total cleaning minutes Utilities Total procedure minutes 11 rect te udgeted Print Done wasoul 106.500 $ 98.500 $ 104.000 er i X - mount Required TO 1. Calculate the budgeted cost per service for X-rays, ultrasounds, CT scans, and MRIs using direct technician labour as the cost allocation base. 2. Calculate the budgeted cost per service for X-rays, ultrasounds, CT scans, and MRIs if RRC allocated overhead costs using ABC. 3. Explain how the disaggregation of information could be helpful to RRC's intention to continuously improve its services. the b Print Done 90,000 104,UUU Requirement 3. Explain how the disaggregation of information could be helpful to RRC's intention to continuously improve its services. activity Using the disaggregated activity-based costing data, managers can see that cost substantially more and generates a lot of maintenance activity and sanitation activity. Managers should examine the use of these two activities to search for ways to substantially less than the traditional system indicated. In particular, a(n) the activity consumption and ultimately its Choose from any list or enter any number in the input fields and then continue to the next question. Ridge's Radiology Centre (RRC) performs X-rays, ultrasounds, CT scans, and MRIS. RRC has developed a reputation as a top radiology centre in the area. RRC has achieved this status because it constantly reexamines its processes and procedures. RRC has been using a single, facility-wide overhead allocation rate. The VP of Finance believes that RRC can make better process improvements if it uses more disaggregated cost information. She says, "We have state-of-the-art medical imaging technology. Can't we have state-of-the-art accounting technology?" The following budgeted information is available. E (Click the icon to view the budgeted information.) (Click to ( Required i Budgeted information X Requirement 1. Calculate the budgeted cost per service for X-rays, ull Determine the formula to calculate the overhead costs allocated to ead Depreciation 32,100 272,000 437,000 892,000 1,633,100 t; then round the costs allocated to the nearest whole number.) Materials 22.100 17,000 24,100 31,500 94,700 Budgeted overh x (Total indirect costs Administration 23,500 X-Rays Maintenance Sanitation Ultrasound 244,000 199,000 133,000 $ 114,200 $ 395,500 $ 559,600 $ 1,027,500 $ 2,696,300 Utilities CT Scan 1 MRI 1 Totals X Now calculate the total budgeted costs for each service using direct te budgeted cost per service to the nearest cent.) 4,100 4,500 3,100 2,700 Number of procedures Minutes to clean after each procedure 10 10 15 35 $ X-Rays Ultrasou 60,000 $ 106 32,100 272 Technician labour Depreciation Materials 22,100 17 Print Done Done Indirect costs Total budgeted costs to eal i Additional information X then ro Overill RRC operates at capacity. The proposed allocation bases for overhead are as follows: Administration Number of procedures Maintenance (including parts) Capital cost of the equipment (depreciation) Sanitation Total cleaning minutes Utilities Total procedure minutes 11 rect te udgeted Print Done wasoul 106.500 $ 98.500 $ 104.000 er i X - mount Required TO 1. Calculate the budgeted cost per service for X-rays, ultrasounds, CT scans, and MRIs using direct technician labour as the cost allocation base. 2. Calculate the budgeted cost per service for X-rays, ultrasounds, CT scans, and MRIs if RRC allocated overhead costs using ABC. 3. Explain how the disaggregation of information could be helpful to RRC's intention to continuously improve its services. the b Print Done 90,000 104,UUU Requirement 3. Explain how the disaggregation of information could be helpful to RRC's intention to continuously improve its services. activity Using the disaggregated activity-based costing data, managers can see that cost substantially more and generates a lot of maintenance activity and sanitation activity. Managers should examine the use of these two activities to search for ways to substantially less than the traditional system indicated. In particular, a(n) the activity consumption and ultimately its Choose from any list or enter any number in the input fields and then continue to the next
