Crosstown Health Center runs two programs: drug addict rehabilitation and after- care (counseling and support of patients after release from a mental hospital). The center's budget for 2017 follows. Professional salaries: 4 physicians x $150,000 12 psychologists x $75,000 16 nurses x $30,000 Medical supplies $600,000 900,000 480,000 $1,980,000 242,000 Rent and clinic maintenance 138,600 Administrative costs to manage patient charts, food, laundry Laboratory services Total 484,000 92,400 $2,937,000 Kim Yu, the director of the center, is keen on determining the cost of each program. Yu compiles the follow- ing data describing employee allocations to individual programs: Total Employees Drug Aftercare Physicians Psychologists 12 Nurses 10 16 Yu has recently become aware of activity-based costing as a method to refine costing systems. She asks her accountant, Gus Gates, how she should apply this technique. Gates obtains the following budgeted information for 2017: Drug Total Aftercare Square feet of space occupied by each program Patient-years of service Number of laboratory tests 9,000 12,000 21,000 50 60 110 700 1,400 2,100

Crosstown Health Center runs two programs: drug addict rehabilitation and after- care (counseling and support of patients after release from a mental hospital). The center's budget for 2017 follows. Professional salaries: 4 physicians x $150,000 12 psychologists x $75,000 16 nurses x $30,000 Medical supplies $600,000 900,000 480,000 $1,980,000 242,000 Rent and clinic maintenance 138,600 Administrative costs to manage patient charts, food, laundry Laboratory services Total 484,000 92,400 $2,937,000 Kim Yu, the director of the center, is keen on determining the cost of each program. Yu compiles the follow- ing data describing employee allocations to individual programs: Total Employees Drug Aftercare Physicians Psychologists 12 Nurses 10 16 Yu has recently become aware of activity-based costing as a method to refine costing systems. She asks her accountant, Gus Gates, how she should apply this technique. Gates obtains the following budgeted information for 2017: Drug Total Aftercare Square feet of space occupied by each program Patient-years of service Number of laboratory tests 9,000 12,000 21,000 50 60 110 700 1,400 2,100

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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