Zelman to answer the following questions. Calculate the per unit cost of an initial visit using both the conventional and ABC approaches. Calculate the per unit cost of a regular visit using both the conventional and ABC approaches. Calculate the per unit cost of an intensive visit using both the conventional and ABC approaches. Exhibit 12-14 Basic data and calculation of unit costs using a conventional approach Total Cost by Visit Type Basic Data A B C D Initial Regular Intensive Total (Given) (Given) (Given) (A + B + C) 1 Number of visits 8,000 26,000 8,600 42,600 2 Direct materials (etc.) $40,000 $50,000 $65,000 $155,000 3 Direct labor $100,000 $120,000 $280,000 $500,000 4 Estimated overhead (total is a given) $229,000 5 Cost / visit: conventional method Additional basic data 1) Basic data: annual projections of overhead costs by activity Cost Driver Information Activity I J K Cost Driver Units (Given) (Given) (Gi

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

Use the information below or using Exhibit 12.14 on page 577 in Zelman to answer the following questions.

Calculate the per unit cost of an initial visit using both the conventional and ABC approaches.
Calculate the per unit cost of a regular visit using both the conventional and ABC approaches.
Calculate the per unit cost of an intensive visit using both the conventional and ABC approaches.

Exhibit 12-14

	Basic data and calculation of unit costs using a conventional approach				Total Cost by Visit Type
				Basic Data
				A		B	C		D
				Initial		Regular	Intensive		Total
				(Given)		(Given)	(Given)		(A + B + C)
		1	Number of visits	8,000		26,000	8,600		42,600
		2	Direct materials (etc.)	$40,000		$50,000	$65,000		$155,000
		3	Direct labor	$100,000		$120,000	$280,000		$500,000
		4	Estimated overhead (total is a given)					$229,000
		5	Cost / visit: conventional method

	Additional basic data		1) Basic data: annual projections of overhead costs by activity
				Cost Driver Information
			Activity	I		J	K
				Cost		Driver	Units
				(Given)		(Given)	(Given)
		6	Intake	$34,000		New visits	3,550	New visits
		7	Medical records	$35,000		Time spent	2,390	Hours
		8	Billing	$65,000		Time spent	5,400	Hours
		9	Other	$95,000		Visits	42,600	Visits
		10	Total	$229,000

		2) Basic data: actual annual operating results of cost drivers to be used to assign ABC overhead cost
				Visit Type
				M		N	O		P
				Initial		Regular	Intensive		Total
				(Given)		(Given)	(Given)		(M + N + O)
		11	New visits	2,500		700	350		3,550
		12	Medical records	600		640	1,150		2,390
		13	Billing	3,200		1,000	1,200		5,400
		14	Other	8,000		26,000	8,600		42,600

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 5 steps with 8 images

SEE SOLUTION Check out a sample Q&A here

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.

Similar questions