Southwest Community Hospital uses a job-order costing system to track charges for each patient. The following charges relate to Candice O'Dea, who had laparoscopic knee surgery: Pharmacy Sterile supply Supplies, other $250 1,000 4,000 Operating room service (nursing staff) 4,000 Anesthesia Anesthesiologist 1,000 3,000 Southwest charges patients for the use of the operating room based on a predetermined overhead rate. The estimated overhead costs of the operating room are $5,000,000, and the activity base is available hours of 2,000. a. Calculate the predetermined overhead rate for the operating room and determine the charge to Candice. Assume that her surgery took 3 hours in the operating room. b. Calculate the total cost for the knee surgery.
Southwest Community Hospital uses a job-order costing system to track charges for each patient. The following charges relate to Candice O'Dea, who had laparoscopic knee surgery: Pharmacy Sterile supply Supplies, other $250 1,000 4,000 Operating room service (nursing staff) 4,000 Anesthesia Anesthesiologist 1,000 3,000 Southwest charges patients for the use of the operating room based on a predetermined overhead rate. The estimated overhead costs of the operating room are $5,000,000, and the activity base is available hours of 2,000. a. Calculate the predetermined overhead rate for the operating room and determine the charge to Candice. Assume that her surgery took 3 hours in the operating room. b. Calculate the total cost for the knee surgery.
Chapter5: Gross Income: Exclusions
Section: Chapter Questions
Problem 39P
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Transcribed Image Text:Southwest Community Hospital uses a job-order costing system to track
charges for each patient. The following charges relate to Candice O'Dea,
who had laparoscopic knee surgery:
Pharmacy
Sterile supply
Supplies, other
$250
1,000
4,000
Operating room service (nursing staff) 4,000
Anesthesia
Anesthesiologist
1,000
3,000
Southwest charges patients for the use of the operating room based on
a predetermined overhead rate. The estimated overhead costs of the
operating room are $5,000,000, and the activity base is available hours
of 2,000.
a. Calculate the predetermined overhead rate for the operating room and
determine the charge to Candice. Assume that her surgery took 3 hours
in the operating room.
b. Calculate the total cost for the knee surgery.
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