Draw a scatter diagram of the clinic’s administrative costs during its first year of operations, visually fit a curvilinear cost line to the plotted data, mark the clinic’s relevant range of activity on the scatter diagram, and visually fit a semi-variable cost line to approximate the curvilinear cost behavior pattern within the clinic relevant range.

Question

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Answer 1

Question

Chapter 6, Problem 48C

1.,2.,3.&4.

To determine

Draw a scatter diagram of the clinic’s administrative costs during its first year of operations, visually fit a curvilinear cost line to the plotted data, mark the clinic’s relevant range of activity on the scatter diagram, and visually fit a semi-variable cost line to approximate the curvilinear cost behavior pattern within the clinic relevant range.

5.

To determine

Estimate the fixed cost and variable cost components of the visually fit semi-variable cost line.

6.

To determine

Identify an equation to express the semi-variable cost approximation of the clinic’s administrative costs.

7.

To determine

Predict the clinic’s administrative cost during a month when 800 patients and 300 patient visit the clinic, and state the visually fit cost lines use to make each of these predictions.

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Students have asked these similar questions

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David Jones, the new administrator for a surgical clinic, was trying to determine how to allocate his indirect expenses. His staff was complaining that the current method of taking a percentage of revenues was unfair. He decided to try to allocate utilities based on square footage of each department, administration based on direct costs, and laboratory based on tests. Use the information in the chart below to answer problems 22, 23 and 24. Square Footage DirectExpenses Lab Tests Utilities $200,000 Administration 2,000 500,000 Laboratory 2,000 625,000 Day-op Suite 3,000 1,400,000 4,000 Cystoscopy 1,500 300,000 500 Endoscopy 1,500 600,000 500 Total 10,000 $3,375,000 5,000 1. What are the Day Op Suite’s total expenses? 2. What are the Cystoscopy Department’s total expenses? 3. What are the Endoscopy Department’s total expenses?

Falls Creek Community Health Clinic uses the high-low method to analyze cost behavior and has determined that number of patients treated predict the clinic's total treatment costs. Determine the cost function (formula) for total treatment costs. What will the estimated treatment cost be if Falls Creek treats 1,402 patients in a month? Total Number Treatment of Patients Costs January $3,410 February $3,790 $3,574 $3,730 $4,500 1060 1180 March 1030 April 1260 May 1310 $4,294 June 1430 (Round your final answer to two decimal places)

Answer 2

Question

Chapter 6, Problem 48C

1.,2.,3.&4.

To determine

Draw a scatter diagram of the clinic’s administrative costs during its first year of operations, visually fit a curvilinear cost line to the plotted data, mark the clinic’s relevant range of activity on the scatter diagram, and visually fit a semi-variable cost line to approximate the curvilinear cost behavior pattern within the clinic relevant range.

5.

To determine

Estimate the fixed cost and variable cost components of the visually fit semi-variable cost line.

6.

To determine

Identify an equation to express the semi-variable cost approximation of the clinic’s administrative costs.

7.

To determine

Predict the clinic’s administrative cost during a month when 800 patients and 300 patient visit the clinic, and state the visually fit cost lines use to make each of these predictions.

Expert Solution & Answer

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Answer 3

Question

Chapter 6, Problem 48C

1.,2.,3.&4.

To determine

Draw a scatter diagram of the clinic’s administrative costs during its first year of operations, visually fit a curvilinear cost line to the plotted data, mark the clinic’s relevant range of activity on the scatter diagram, and visually fit a semi-variable cost line to approximate the curvilinear cost behavior pattern within the clinic relevant range.

5.

To determine

Estimate the fixed cost and variable cost components of the visually fit semi-variable cost line.

6.

To determine

Identify an equation to express the semi-variable cost approximation of the clinic’s administrative costs.

7.

To determine

Predict the clinic’s administrative cost during a month when 800 patients and 300 patient visit the clinic, and state the visually fit cost lines use to make each of these predictions.

Expert Solution & Answer

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Answer 4

Question

Chapter 6, Problem 48C

1.,2.,3.&4.

To determine

Draw a scatter diagram of the clinic’s administrative costs during its first year of operations, visually fit a curvilinear cost line to the plotted data, mark the clinic’s relevant range of activity on the scatter diagram, and visually fit a semi-variable cost line to approximate the curvilinear cost behavior pattern within the clinic relevant range.

5.

To determine

Estimate the fixed cost and variable cost components of the visually fit semi-variable cost line.

6.

To determine

Identify an equation to express the semi-variable cost approximation of the clinic’s administrative costs.

7.

To determine

Predict the clinic’s administrative cost during a month when 800 patients and 300 patient visit the clinic, and state the visually fit cost lines use to make each of these predictions.

Expert Solution & Answer

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Answer 5

Chapter 6, Problem 48C

1.,2.,3.&4.

To determine

Draw a scatter diagram of the clinic’s administrative costs during its first year of operations, visually fit a curvilinear cost line to the plotted data, mark the clinic’s relevant range of activity on the scatter diagram, and visually fit a semi-variable cost line to approximate the curvilinear cost behavior pattern within the clinic relevant range.

5.

To determine

Estimate the fixed cost and variable cost components of the visually fit semi-variable cost line.

6.

To determine

Identify an equation to express the semi-variable cost approximation of the clinic’s administrative costs.

7.

To determine

Predict the clinic’s administrative cost during a month when 800 patients and 300 patient visit the clinic, and state the visually fit cost lines use to make each of these predictions.

Answer 6

Chapter 6, Problem 48C

1.,2.,3.&4.

To determine

Draw a scatter diagram of the clinic’s administrative costs during its first year of operations, visually fit a curvilinear cost line to the plotted data, mark the clinic’s relevant range of activity on the scatter diagram, and visually fit a semi-variable cost line to approximate the curvilinear cost behavior pattern within the clinic relevant range.

Answer 7

Chapter 6, Problem 48C

1.,2.,3.&4.

To determine

Draw a scatter diagram of the clinic’s administrative costs during its first year of operations, visually fit a curvilinear cost line to the plotted data, mark the clinic’s relevant range of activity on the scatter diagram, and visually fit a semi-variable cost line to approximate the curvilinear cost behavior pattern within the clinic relevant range.

Answer 8

5.

To determine

Estimate the fixed cost and variable cost components of the visually fit semi-variable cost line.

Answer 9

5.

To determine

Estimate the fixed cost and variable cost components of the visually fit semi-variable cost line.

Answer 10

6.

To determine

Identify an equation to express the semi-variable cost approximation of the clinic’s administrative costs.

Answer 11

6.

To determine

Identify an equation to express the semi-variable cost approximation of the clinic’s administrative costs.

Answer 12

7.

To determine

Predict the clinic’s administrative cost during a month when 800 patients and 300 patient visit the clinic, and state the visually fit cost lines use to make each of these predictions.

Answer 13

7.

To determine

Predict the clinic’s administrative cost during a month when 800 patients and 300 patient visit the clinic, and state the visually fit cost lines use to make each of these predictions.

Answer 14

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Answer 15

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Answer 16

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Answer 17

Ch. 6 - Describe the importance of cost behavior patterns...Ch. 6 - Define the following terms, and explain the...Ch. 6 - Suggest an appropriate activity base (or cost...Ch. 6 - Draw a simple graph of each of the following types...Ch. 6 - Explain the impact of an increase in the level of...Ch. 6 - Explain why a manufacturers cost of supervising...Ch. 6 - Explain the impact of an increase in the level of...Ch. 6 - Prob. 8RQ Ch. 6 - Indicate which of the following descriptions is...Ch. 6 - Prob. 10RQ

Solution Summary: The author explains the visual-fit method used to estimate the fixed cost and variable cost components of the semi-variable cost line.

Concept explainers

Estimate the fixed cost and variable cost components of the visually fit semi-variable cost line.

Identify an equation to express the semi-variable cost approximation of the clinic’s administrative costs.

Predict the clinic’s administrative cost during a month when 800 patients and 300 patient visit the clinic, and state the visually fit cost lines use to make each of these predictions.

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Chapter 6 Solutions