Activity-Based Costing for a Service Company Crosswinds Hospital plans to use activity-based costing to assign hospital...

Activity-Based Costing for a Service Company

Activity		Activity Rate
Room and meals	$210	per day
Radiology	$296	per image
Pharmacy	$45	per physician order
Chemistry lab	$77	per test
Operating room	$740	per operating room hour

The activity usage information associated with the two patients is as follows:

	Abel Putin		Cheryl Umit
Number of days	3	days	11	days
Number of images	4	images	5	images
Number of physician orders	7	orders	9	orders
Number of tests	3	tests	6	tests
Number of operating room hours	3.5	hours	5.5	hours

a. Determine the activity cost associated with each patient.

Abel Putin	$
Cheryl Umit	$

Solutions

Expert Solution

Activity cost associated with patient Abel Putin

Activity	Activity base usage (1)	Activity Rate (2)	Total cost (1)*(2) per actvity
Rooms and meals	3 days	210 per day	630
Radiology	4 images	296 per image	1184
Pharmacy	7 orders	45 per order	315
Chemistry Lab	3 test	77 per test	231
Operating Room	3.5 hours	740 per hour	2590

TOTAL ACTIVITY COST = $ 4950

Activity cost associated with patient Cheril Umit Putin

Activity	Activity base usage (1)	Activity Rate (2)	Total cost (1)*(2) per actvity
Rooms and meals	11 days	210 per day	2310
Radiology	5 images	296 per image	1480
Pharmacy	9 orders	45 per order	405
Chemistry Lab	6 test	77 per test	462
Operating Room	5.5 hours	740 per hour	4070

TOTAL ACTIVITY COST = $ 8727

ekkarill92 answered 1 year ago

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