Surgery Center is an outpatient surgical clinic that was profitable for many years, but Medicare has cut its reimbursements by as much as 30%. As a result, the clinic wants to better understand its costs. It decides to prepare an activity-based cost analysis, including an estimate of the average cost of both general surgery and orthopedic surgery. The clinics three activity cost pools and their cost drivers follow.

Activity Cost Pool	Cost				Cost Driver			Driver Quantity
Professional salaries .		$	2,520,000			Professional hours			12,000
Patient services and supplies			44,000			Number of patients			800
Building cost			255,000			Square feet			1,700

The two main surgical units and their related data follow.

Service	Hours			Square Feet*			Patients
General surgery		3,500			700			500
Orthopedic surgery		8,500			1,000			300

* Orthopedic surgery requires more space for patients, supplies, and equipment.

Required:

1.&2.	Compute the cost per cost driver for each of the three activity cost pools. Use the results to allocate costs to both the general surgery and the orthopedic surgery units. Compute total cost and average cost per patient for both the general surgery and the orthopedic surgery units