A Community Hospital has two (2) service departments: Maintenance and Food Services. The hospital has three (3) patient care units, namely: General Medicine, OB, and Surgery. Additional information are as follows: Amount of cost to be allocated: Maintenance P 8,000,000 Food Services P 3,000,000 Allocation method: Maintenance Costs are allocated based on square foot assigned to the Food Service Costs are allocated based on number of meals served to the EXPECTED UTILIZATION RATES SQ. FT. Meals Served Food Services 10,000 30,000 Maintenance 10,000 10,000 Surgery 20,000 40,000 OB 30,000 30,000 General Medicine 30,000 90,000 TOTAL 100,000 200,000 Using the information, allocate the costs of the two (2) service departments with the three (3) patient care units using: Direct Method, Step Method – Maintenance First, Step Method – Food Services First, and Reciprocal Method.
A Community Hospital has two (2) service departments: Maintenance and Food Services. The hospital has three (3) patient care units, namely: General Medicine, OB, and Surgery. Additional information are as follows: Amount of cost to be allocated: Maintenance P 8,000,000 Food Services P 3,000,000 Allocation method: Maintenance Costs are allocated based on square foot assigned to the Food Service Costs are allocated based on number of meals served to the EXPECTED UTILIZATION RATES SQ. FT. Meals Served Food Services 10,000 30,000 Maintenance 10,000 10,000 Surgery 20,000 40,000 OB 30,000 30,000 General Medicine 30,000 90,000 TOTAL 100,000 200,000 Using the information, allocate the costs of the two (2) service departments with the three (3) patient care units using: Direct Method, Step Method – Maintenance First, Step Method – Food Services First, and Reciprocal Method.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
A Community Hospital has two (2) service departments: Maintenance and Food Services. The hospital has three (3) patient care units, namely: General Medicine, OB, and Surgery.
Additional information are as follows:
- Amount of cost to be allocated:
|
Maintenance |
P 8,000,000 |
|
Food Services |
P 3,000,000 |
- Allocation method:
- Maintenance Costs are allocated based on square foot assigned to the
- Food Service Costs are allocated based on number of meals served to the
|
EXPECTED UTILIZATION RATES |
||
|
|
SQ. FT. |
Meals Served |
|
Food Services |
10,000 |
30,000 |
|
Maintenance |
10,000 |
10,000 |
|
Surgery |
20,000 |
40,000 |
|
OB |
30,000 |
30,000 |
|
General Medicine |
30,000 |
90,000 |
|
TOTAL |
100,000 |
200,000 |
- Using the information, allocate the costs of the two (2) service departments with the three (3) patient care units using: Direct Method, Step Method – Maintenance First, Step Method – Food Services First, and Reciprocal Method.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 5 steps with 8 images
Knowledge Booster
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.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education