Process activity analysis for service Company making payments on insurance claims as follows: Receiving claim, adjusting claim,paying claim. Receiving claim- $78,000, adjusting claim- 338,000, paying claim-104,000 ,total $ 520,000 This process includes only the Consular processing the claim payments, not ask you about when the claim payments. The adjustment activity involves verifying and estimated amount of clean and is variable to the number of claims adjust. The process receive adjusted, and paid 6,500 claims during the period. All claims were treated identically in this process. To improve the cost of this process, management has determined that claims should be segregated into two categories. Claims under $1,000 claims greater than 1,000; claims under 1,000 would not be adjusted but will be accepted upon insureds xthe evidence of claims. Play Inseparable at the housing would be adjusted. It is estimated that 75% of the claims are under a thousand and would thus be paid without adjustment. It is also estimated that the additional effort to segregate claims would add 10% to the receiving claim activity cost. A. Develop a table showing the percentage of injuries during activity caused to the total process cost. Round the percent to the nearest whole number, if required.

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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Process activity analysis for service Company making payments on insurance claims as follows: Receiving claim, adjusting claim,paying claim. Receiving claim- $78,000, adjusting claim- 338,000, paying claim-104,000 ,total $ 520,000 This process includes only the Consular processing the claim payments, not ask you about when the claim payments. The adjustment activity involves verifying and estimated amount of clean and is variable to the number of claims adjust. The process receive adjusted, and paid 6,500 claims during the period. All claims were treated identically in this process. To improve the cost of this process, management has determined that claims should be segregated into two categories. Claims under $1,000 claims greater than 1,000; claims under 1,000 would not be adjusted but will be accepted upon insureds xthe evidence of claims. Play Inseparable at the housing would be adjusted. It is estimated that 75% of the claims are under a thousand and would thus be paid without adjustment. It is also estimated that the additional effort to segregate claims would add 10% to the receiving claim activity cost. A. Develop a table showing the percentage of injuries during activity caused to the total process cost. Round the percent to the nearest whole number, if required.

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