Answered step by step
Verified Expert Solution
Question
1 Approved Answer
* ***What are the overhead costs per patient??*** Activity Rate 1. Compute activity rates using activity-based costing. Activity Budgeted Cost Supplies $ 2,394,000 Patient services
****What are the overhead costs per patient??***
Activity Rate 1. Compute activity rates using activity-based costing. Activity Budgeted Cost Supplies $ 2,394,000 Patient services 56,000 Building cost 378,000 $ Budgeted Activity Usage 14,000 surgical hours 800 number of patients 2,700 square feet $ 171 per surgical hour 70 per patient 140 per square foot 2. Allocate overhead cost to the general surgery and to the orthopedic surgery units. Compute overhead cost per patient for each surgery unit. General surgery -----Activity Usage----- -----Activity rate----- Allocated Cost Supplies $ $ Patient services $ 3,200 surgical hours 600 patients 750 square feet Total overhead cost 171 per surgical hour 70 per patient 140 per square foot 547,200 42,000 105,000 694,200 Building cost $ $ 600 Number of patients Overhead cost per patient Orthopedic Surgery -----Activity Usage----- -----Activity rate----- Allocated Cost Supplies $ $ 1,846,800 10,800 surgical hours 200 patients Patient services $ 171 per surgical hour 70 per patient 140 per square foot 14,000 Building cost 1,950 square feet $ 273,000 2,133,800 Total overhead cost $ 200 Number of patients Overhead cost per patient 14 Optimal Health is an outpatient surgical clinic. The clinic's three activities, their overhead cost, and their cost drivers follow. 3 points Activity Supplies Patient services Building cost Budgeted Cost Activity Cost Driver $ 2,394,000 Surgical hours (SH) 56,000 Number of patients 378,000 Square feet Budgeted Activity Usage 14,000 800 2,700 eBook The two main surgical units and their actual activity usage follow. Print References Service General surgery Orthopedic surgery Actual Activity Usage Surgical Hours Patients Square Feet 3,200 600 750 10,800 200 1,950 Required: 1. Compute activity rates using activity-based costing. 2. Allocate overhead cost to the general surgery and to the orthopedic surgery units. Compute overhead cost per patient for each surgery unitStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started