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The housekeeping services department of Hattiesburg Clinic, a multispecialty practice, had $200,000 in direct costs in 2021. These costs must be allocated to Hattiesburg's three
The housekeeping services department of Hattiesburg Clinic, a multispecialty practice, had $200,000 in direct costs in 2021. These costs must be allocated to Hattiesburg's three revenueproducing patient services departments using the direct method. Two cost drivers are under consideration: patient services revenue and hours of housekeeping services used. The patient services departments generated $10 million in total revenues during 2021, and to support these clinical activities, they used 8,000 hours of housekeeping services. What is the allocation rate if patient services revenue is used as the cost driver? 50 20 0.01 0.02
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