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# PLEASE HELP! I NEED TO FIGURE THIS OUT BEFORE MIDNIGHT! I CAN PAY ADDITTIONAL DUE TO THE COMPLEXITY OF THE PROBLEMS! THANK YOU!

PLEASE HELP! I NEED TO FIGURE THIS OUT BEFORE MIDNIGHT! I CAN PAY ADDITTIONAL DUE TO THE COMPLEXITY OF THE PROBLEMS! THANK YOU!

I am having difficulties with the following two part chapter review problem:

Use the following data to answer the question 6.3 (a&b):

St. Benedict's Hospital has three support departments and four patient services departments. The direct cost to each of the support departments is as follows:

Facilities \$5,000,000

Financial Services \$3,000,000

Selected data for the three support and four patient service departments are shown below:

Department           Patient Services Revenue      Square feet   Housekeeping Labor Hours Salary dollars

Support:

Facilities                                              20,000      5,000    3,000,000

Financial Services 15,000      3,000              2,000,000

Total                           45,000         10,000   \$ 6,500,000

Patient Services:

Routine Care      \$30,000,000                    400,000     150,000        \$12,000,000

Intensive Care                4,000,000                40,000       30,000             5,000,000

Diagnostic Services        6,000,000                     60,000      15,000              6,000,000

Other Services       10,000,000 100,000     25,000    7,000,000

Total  \$50,000,000                     600,000       220,000        \$30,000,000

GRAND TOTAL       \$50,000,000                      645,000       230,000        \$36,500,000

6.3 Assume that the hospital uses the direct method for cost allocation. Furthermore, the cost driver for general administration and financial services and patient services revenue, while the cost driver for facilities is space utilization.

a.) What are the appropriate allocation rates?

b.) Use the table below to allocate the hospitals overhead costs to the patient services departments. Fill in the chart below:

Support Department Allocation Rate Routine Care   Intensive Care  Diagnostic Services Total

General Admin _____________ ___________   _____________ __________________ _________

Facilities _____________ ___________   _____________ __________________ _________

Financial Services _____________ ___________    ____________ __________________ _________

Total Indirect Costs _____________ ___________    ____________ __________________ __________

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