Activity-Based Product Costing
Suppose that a surgical ward has gathered the following information for four nursing activities and two types of patients:
Patient Category | ||||
Driver | Normal | Intensive | Activity Rate | |
Treating patients | Treatments | 8,400 | 9,000 | $4.00 |
Providing hygienic care | Hygienic hours | 5,300 | 17,600 | 5.00 |
Responding to requests | Requests | 32,000 | 80,000 | 2.00 |
Monitoring patients | Monitoring hours | 6,000 | 72,000 | 3.00 |
Required:
1. Determine the total nursing costs assigned to each patient category.
Costs Assigned | |
Normal | $ |
Intensive | $ |
2. Output is measured in patient days. Assuming that the normal patient category uses 8,000 patient days and the intensive patient category uses 6,400 patient days, calculate the nursing cost per patient day for each type of patient. Round your answers to the nearest cent.
Normal | $ per patient day |
Intensive | $ per patient day |
3. Conceptual Connection: The supervisor of the
surgical ward has suggested that patient days is the only driver
needed to assign nursing costs to each type of patient. Calculate
the charge per patient day using this approach. Round your answer
to the nearest cent.
$ per patient day
Cost Assigned |
|
Normal |
$142,100 |
Intensive |
$500,000 |
--Working
Cost Assigned |
|
Normal |
=+(8400*4)+(5300*5)+(32000*2)+(6000*3) |
Intensive |
=+(9000*4)+(17600*5)+(80000*2)+(72000*3) |
Normal |
$17.76 |
per patient day [$142100 / 8000] |
Intensive |
$78.13 |
per patient day [$500000 / 6400] |
Total Cost |
$642,100 |
[$142100 + 500000] |
Tota Patient days |
14400 |
[8000 + 6400] |
Cost per patient day |
$44.59 |
per patient day = ANSWER |
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