Activity-Based Costing for a Service CompanyCrosswinds Hospital plans to use activity-based costing to assign hospital indirect costs to the care of patients. The hospital has identified the following activities and activity rates for the hospital indirect costs: Activity Activity Rate Room and meals $163 per day Radiology $230 per image Pharmacy $50 per physician order Chemistry lab $89 per test Operating room $720 per operating room hour The activity usage information associated with the two patients is as follows: Abel Putin Cheryl Umit Number of days 6 days 9 days Number of images 2 images 7 images Number of physician orders 5 orders 7 orders Number of tests 5 tests 8 tests Number of operating room hours 2.5 hours 6 hours a.Determine the activity cost associated with each patient. Abel Putin $fill in the blank 1 Cheryl Umit $fill in the blank 2 b.Why is the total activity cost different for the two patients? apparently had a different condition that required more extensive treatment. Thus, the activity cost to is more than the activity cost of the other patient.

Activity-Based Costing for a Service Company Crosswinds Hospital plans to use activity-based costing to assign hospital indirect costs to the care of patients. The hospital has identified the...

Activity-Based Costing for a Service Company

Crosswinds Hospital plans to use activity-based costing to assign hospital indirect costs to the care of patients. The hospital has identified the following activities and activity rates for the hospital indirect costs:

Activity		Activity Rate
Room and meals	$163	per day
Radiology	$230	per image
Pharmacy	$50	per physician order
Chemistry lab	$89	per test
Operating room	$720	per operating room hour

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

	Abel Putin	Cheryl Umit
Number of days	6	days	9	days
Number of images	2	images	7	images
Number of physician orders	5	orders	7	orders
Number of tests	5	tests	8	tests
Number of operating room hours	2.5	hours	6	hours

a.Determine the activity cost associated with each patient.

Abel Putin	$fill in the blank 1
Cheryl Umit	$fill in the blank 2

b.Why is the total activity cost different for the two patients?

apparently had a different condition that required more extensive treatment. Thus, the activity cost to is more than the activity cost of the other patient.

Jun 01, 2022

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Activity-Based Costing for a Service Company Crosswinds Hospital plans to use activity-based costing to assign hospital indirect costs to the care of patients. The hospital has identified the...

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