Homework Help is Here – Start Your Trial Now!
Business
Accounting
To compute a daily rate that reflected the difference in demands, patients were placed in three categories according to illness severity, and the following annual data were collected: Cost of Activity Activity Driver Activity Lodging Monitoring Feeding Nursing care Total The demands associated with patient severity are also provided: Low Severity Patient Days Monitoring Hours Nursing Hours High Medium Rate 1 Rate 2 Rate 3 7,170 10,180 3,680 $546,780 2,132,200 441,630 4,185,700 $7,306,310 High severity Medium severity Low severity Patient days Monitoring hours used Patient days Nursing hours 15,170 Required: 1. Suppose that the costs of daily care are assigned using only patient days as the activity driver (which is also the measure of output). Compute the daily rate using this unit-based approach of cost assignment. If required, round your answer to the nearest cent. $ per day 2. Compute activity rates using the given activity drivers (combine activities with the same driver). If required, round your answers to the nearest cent. per patient day per monitoring hour per hour of nursing care 3. Compute the charge per patient day for each patient type using the activity rates from Requirement 2 and the demands on each activity. Round your interim calculations and final answers to the nearest cent. 12,030 3,260 133,100 72,900 14,300 Quantity 21,030 30,460 21,030 220,300 per patient day per patient day per patient day

To compute a daily rate that reflected the difference in demands, patients were placed in three categories according to illness severity, and the following annual data were collected: Cost of Activity Activity Driver Activity Lodging Monitoring Feeding Nursing care Total The demands associated with patient severity are also provided: Low Severity Patient Days Monitoring Hours Nursing Hours High Medium Rate 1 Rate 2 Rate 3 7,170 10,180 3,680 $546,780 2,132,200 441,630 4,185,700 $7,306,310 High severity Medium severity Low severity Patient days Monitoring hours used Patient days Nursing hours 15,170 Required: 1. Suppose that the costs of daily care are assigned using only patient days as the activity driver (which is also the measure of output). Compute the daily rate using this unit-based approach of cost assignment. If required, round your answer to the nearest cent. $ per day 2. Compute activity rates using the given activity drivers (combine activities with the same driver). If required, round your answers to the nearest cent. per patient day per monitoring hour per hour of nursing care 3. Compute the charge per patient day for each patient type using the activity rates from Requirement 2 and the demands on each activity. Round your interim calculations and final answers to the nearest cent. 12,030 3,260 133,100 72,900 14,300 Quantity 21,030 30,460 21,030 220,300 per patient day per patient day per patient day

Financial And Managerial Accounting
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter18: Activity-based Costing
Section: Chapter Questions
Problem 5MAD: Hospital activity-based costing analysis Lancaster County Hospital uses activity-based costing to...
See similar textbooks
icon
Related questions
Question
To compute a daily rate that reflected the difference in demands, patients were placed in three categories according to illness severity, and the following annual data were collected: Cost of Activity Activity Driver $ 546,780 2,132,200 441,630 4,185,700 $7,306,310 Activity Lodging Monitoring Feeding Nursing care Total The demands associated with patient severity are also provided: Severity Patient Days Monitoring Hours Nursing Hours High Medium Low 7,170 10,180 3,680 $ Patient days Monitoring hours used Patient days Nursing hours High severity Medium severity Low severity 15,170 12,030 3,260 133,100 72,900 14,300 Required: 1. Suppose that the costs of daily care are assigned using only patient days as the activity driver (which is also the measure of output). Compute the daily rate using this unit-based approach of cost assignment. If required, round your answer to the nearest cent. per day 2. Compute activity rates using the given activity drivers (combine activities with the same driver). If required, round your answers to the nearest cent. Rate 1 per patient day Rate 2 per monitoring hour Rate 3 per hour of nursing care 3. Compute the charge per patient day for each patient type using the activity rates from Requirement 2 and the demands on each activity. Round your interim calculations and final answers to the nearest cent. per patient day per patient day per patient day Quantity 21,030 30,460 21,030 220,300
Transcribed Image Text:To compute a daily rate that reflected the difference in demands, patients were placed in three categories according to illness severity, and the following annual data were collected: Cost of Activity Activity Driver $ 546,780 2,132,200 441,630 4,185,700 $7,306,310 Activity Lodging Monitoring Feeding Nursing care Total The demands associated with patient severity are also provided: Severity Patient Days Monitoring Hours Nursing Hours High Medium Low 7,170 10,180 3,680 $ Patient days Monitoring hours used Patient days Nursing hours High severity Medium severity Low severity 15,170 12,030 3,260 133,100 72,900 14,300 Required: 1. Suppose that the costs of daily care are assigned using only patient days as the activity driver (which is also the measure of output). Compute the daily rate using this unit-based approach of cost assignment. If required, round your answer to the nearest cent. per day 2. Compute activity rates using the given activity drivers (combine activities with the same driver). If required, round your answers to the nearest cent. Rate 1 per patient day Rate 2 per monitoring hour Rate 3 per hour of nursing care 3. Compute the charge per patient day for each patient type using the activity rates from Requirement 2 and the demands on each activity. Round your interim calculations and final answers to the nearest cent. per patient day per patient day per patient day Quantity 21,030 30,460 21,030 220,300
Expert Solution
steps

Step by step

Solved in 3 steps with 1 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Cost estimation
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Financial And Managerial Accounting
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Managerial Accounting
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Financial & Managerial Accounting
Financial & Managerial Accounting
Accounting
ISBN:
9781337119207
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser…
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS