Northeast Regional Medical Center uses a job-order costing system to track charges for each patient. The following charges relate to Michael Rodriguez, who had arthroscopic shoulder surgery: Pharmacy: $320 Sterile supply: $1,200 Supplies, other: $3,500 Nursing staff: $3,800 Anesthesia: $950 Surgeon: $4,200 Northeast charges patients for the use of the surgical suite based on a predetermined overhead rate. The estimated overhead costs of the surgical suite are $4,800,000, and the activity base is available hours of 1,600. Calculate the predetermined overhead rate for the surgical suite and determine the charge to Michael. Assume that his surgery took 2.5 hours in the surgical suite.

Northeast Regional Medical Center uses a job-order costing system to track charges for each patient. The following charges relate to Michael Rodriguez, who had arthroscopic shoulder surgery: Pharmacy: $320 Sterile supply: $1,200 Supplies, other: $3,500 Nursing staff: $3,800 Anesthesia: $950 Surgeon: $4,200 Northeast charges patients for the use of the surgical suite based on a predetermined overhead rate. The estimated overhead costs of the surgical suite are $4,800,000, and the activity base is available hours of 1,600. Calculate the predetermined overhead rate for the surgical suite and determine the charge to Michael. Assume that his surgery took 2.5 hours in the surgical suite.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter5: Activity-based Costing And Management

Section: Chapter Questions

Problem 56P

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