8) Managerial Financial Accounting Assignments AP2-19 Solution

8) Managerial Financial Accounting Assignments AP2-19 Solution

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AP2-19
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Service Company Use of Predetermined Overhead Rate [LO 6, 7, 9] Southwest Community Hospital uses a job-order costing system to track charges for each patient. The following charges relate to Candice O'Dea, who had laparoscopic knee surgery: Pha rma cy $30 0 Ste rile sup ply 1,3 80 Sup plie s, oth er 4,3 90 Op erat ing roo m ser vic e (nu rsin g staf f) 4,3 30 An est hes ia 1,1 10 An est hes iolo gist 3,3 40 Southwest charges patients for the use of the operating room based on a predetermined overhead rate. The estimated overhead costs of the operating room are $5,202,000, and the activity base is available hours of 2,040.
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Calculate the predetermined overhead rate for the operating room, and determine the overhead charge to Candice. Assume that her surgery took 2 hours in the operating room.
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Unformatted text preview: Predetermined overhead rate $ 5,100 Total overhead charge to Candice $[no answer] AP2-19 The predetermined overhead rate is $2,550 per hour of operating room use. ($5,202,000 ÷ 2,040 hours = $2,550). The total overhead charge to Candice for 2 hours of operating room usage is $5,100 ($2,550 × 2 hours). Calculate the total cost for the knee surgery. $[no answer] AP2-19 The total cost of the knee surgery is $19,950 . Pharmacy $300 Sterile supply 1,380 Supplies other 4,390 OR services 4,330 Anesthesia 1,110 Anesthesiology 3,340 OR overhead charges 5,100 $19,950...
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8) Managerial Financial Accounting Assignments AP2-19 Solution

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