The Housekeeping Services Department of Ruger Clinic, had $100,000 in direct costs during the year. Department Revenue HK...

The Housekeeping Services Department of Ruger Clinic, had $100,000 in direct costs during the year.

Department Revenue HK Hours

Adult Services $3,000,000 1,500

Pediatric Services $1,500,000 3,000

Other Services $ 500,000 500

Total $5,000,000 5,000

What is the dollar allocation to each patient services department if patient services revenue is used as the cost driver?
What is the dollar allocation to each patient services department if hours of housekeeping support are used as the cost driver?
Which of the two drivers is better? Why?

Expert Solution

The answer has been presenetd in the supporting sheet. For detailed answer refer to the supporting sheet.

ekkarill92 answered 1 year ago

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