Standard Costing System: Standard Costing system allows estimating the costs, preparing budgets for future periods, and analyzing the performance by comparing the budgets with actual results and find variances. Static Budget and Flexible budget: Static Budget is prepared on the basis of the expected level of output or production. The static budget shows the budgeted costs are revenue at an expected level of activity. The Flexible budget is prepared using the static budget. The Flexible budget is prepared to take the actual level of output or production as a basis. To Indicate: The reason why Flexible Budgeting method is better than traditional methods of budgeting

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Answer 1

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Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 13, Problem 13.2.2C

To determine

Concept Introduction:

Standard Costing System:

Standard Costing system allows estimating the costs, preparing budgets for future periods, and analyzing the performance by comparing the budgets with actual results and find variances.

Static Budget and Flexible budget:

Static Budget is prepared on the basis of the expected level of output or production. The static budget shows the budgeted costs are revenue at an expected level of activity. The Flexible budget is prepared using the static budget. The Flexible budget is prepared to take the actual level of output or production as a basis.

To Indicate:

The reason why Flexible Budgeting method is better than traditional methods of budgeting

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Children's Hospital of the King's Daughters Health System in Norfolk, Virginia, introduced a new budgeting method that allowed the hospital's annual plan to be updated for changes in operating plans. For example, if the budget was based on 400 patient-days (number of patients × number of days in the hospital) and the actual count rose to 450 patient-days, the variable costs of staffing, lab work, and medication costs could be adjusted to reflect this change. The budget manager stated, “I work with hospital directors to turn data into meaningful information and effect change before the month ends.” What budgeting method is being used under the new approach? What budgeting method do you think was being used under the old method?

PLEASE ANSWER ALL QUESTIONS 27 .Budgeting: A. Sets targets and objectives established by management B. Is intended to control expenses C. Defines how revenue will be earned D. Sets the organization's "rules of the road" for operating 28. Hospitals are currently paid less if a patient is discharged and readmitted within 30 days for a related diagnosis. This is an example of: A. Payment for service provided B. Payment for quality measurement C. Payment for coinsurance D. Payment for deductible 29. Which of the following is not an emerging payment model? A. Patient Centered Medical Home B. ACO C. Bundled Payment D. DRG 30. Which of the following is NOT an incentive to provide more services? A. Capitation B. Charge-based reimbursement C. Per diem D. Per procedure 31. The party ultimately responsible for payment for healthcare services is: A. Medicaid B. The insurer C. The patient D. The provider accounts receivable staff 32. Population health management challenges clinicians to…

Question: Assume that an HMO's capitation payment to PCPs is $20 PMPM, but 15% of this amount is placed in the PCP risk pool. The budgeted amount for specialty and hospital costs is $40 PMPM. The purpose of the risk pool is to encourage the PCPs to take actions that cause realized specialty and hospital costs to be less than those budgeted. Cost is measured by the amount the HMO spends on each physician's referral. There are three PCPs: Physician A, Physician B, and Physician C. Assume that each physician has 1,000 patients. Suppose Physician A's actual referral costs are $500,000, Physician B's are $540,000, and Physician C's are $620,00. Finally, suppose that no PCP will receive any funds from the risk pool if it is empty at the end of the year, but if there are referral funds left in the risk pool at the end of the year, they will be divided equally among the three physicians. 1) What is the amount of referral gain (loss) for Physician A? a. -$100,000 b. -$36,000 c. -$20,000 d.…

Answer 2

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Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 13, Problem 13.2.2C

To determine

Concept Introduction:

Standard Costing System:

Standard Costing system allows estimating the costs, preparing budgets for future periods, and analyzing the performance by comparing the budgets with actual results and find variances.

Static Budget and Flexible budget:

Static Budget is prepared on the basis of the expected level of output or production. The static budget shows the budgeted costs are revenue at an expected level of activity. The Flexible budget is prepared using the static budget. The Flexible budget is prepared to take the actual level of output or production as a basis.

To Indicate:

The reason why Flexible Budgeting method is better than traditional methods of budgeting

Expert Solution & Answer

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Answer 3

Question

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 13, Problem 13.2.2C

To determine

Concept Introduction:

Standard Costing System:

Standard Costing system allows estimating the costs, preparing budgets for future periods, and analyzing the performance by comparing the budgets with actual results and find variances.

Static Budget and Flexible budget:

Static Budget is prepared on the basis of the expected level of output or production. The static budget shows the budgeted costs are revenue at an expected level of activity. The Flexible budget is prepared using the static budget. The Flexible budget is prepared to take the actual level of output or production as a basis.

To Indicate:

The reason why Flexible Budgeting method is better than traditional methods of budgeting

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 13, Problem 13.2.2C

To determine