Question
The Surgical Care Unit of GentleCare Health Group uses the high-low method to predict its total surgical unit supplies costs. It appears that nursing hours
The Surgical Care Unit of
GentleCare Health Group uses the high-low method to predict its total surgical unit supplies costs. It appears that nursing hours worked is a good predictor of surgical unit supplies costs in the unit. The supervisor for the unit has gone through the records for the past year and has found that June had the fewest nursing hours worked at 1,400 hours, while September had the most nursing hours worked at 1,940 hours. In June, total surgical unit supplies cost $34,000 and in September, total surgical unit supplies cost $43,180. If plans for the Surgical Care Unit call for 1,475 nursing hours to be worked next month, what is the expected surgical unit supplies cost for the month?
Use the high-low method to determine the variable and fixed costs components of the Surgical Care Unit of
GentleCare Health Group's operating cost equation.
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