Question

	Clerical Salaries	Administrative Salaries	Computer Services	Total Indirect Cost
Allocation Basis:	A	B	C
Indirect Cost to be Allocated	$56,000	$55,000	$80,000	$191,000
Allocated to:
Physical Therapy (PT)
Occupational Therapy (OT)
Speech Therapy (ST)
Proof Total	$56,000	$55,000	$80,000	$191,000

                                   

Allocation Key:

A= # Visits (Volume): PT=9,600/OT=4,000/ST=2,400/Total=16,000(16,000 x $3.50=$56,000)

B= Proportion of Direct Costs: PT=60%/OT=25%/ST=15%/Total =100%(%x$55,000)

C= #Computers in Service: PT=10/OT=3/ST=3/Total = 16 (16x$5,000 each = $80,000)

Answer 1

Clerical Salaries	Administrative Salaries	Computer Services	Total Indirect Cost
Allocation Basis:	A	B	C
Indirect Cost to be Allocated	$56,000	$55,000	$80,000	$191,000
Allocated to:
Physical Therapy (PT)	9,600 x 3.5 = 33,600	55,000 x 60% = 33,000	5,000 x 10 = 50,000	116,600
Occupational Therapy (OT)	4,000 x 3.5 = 14,000	55,000 x 25% = 13,750	5,000 x 3 = 15,000	42,750
Speech Therapy (ST)	2,400 x 3.5 = 8,400	55,000 x 15% = 8,250	5,000 x 3 = 15,000	31,650
Proof Total	$56,000	$55,000	$80,000	$191,000