The Housekeeping Services Department of Ruger Clinic, had $100,000 in direct costs during the year. Department Revenue HK Hours Adult Services $3,000,000 1,500 Pediatric Services $1,500,000 3,000 Other Services $ 500,000 500 Total $5,000,000 5,000 What is the value of the cost pool? Which of the two cost drivers is better? Patient service revenue or housekeeping hours? Why?
The Housekeeping Services Department of Ruger Clinic, had $100,000 in direct costs during the year. Department Revenue HK Hours Adult Services $3,000,000 1,500 Pediatric Services $1,500,000 3,000 Other Services $ 500,000 500 Total $5,000,000 5,000 What is the value of the cost pool? Which of the two cost drivers is better? Patient service revenue or housekeeping hours? Why?
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
Chapter10: Standard Costing And Variance Analysis
Section: Chapter Questions
Problem 2MTC: The Two Cost Systems Sacred Heart Hospital (SHH) faces skyrocketing nursing costs, all of which...
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- The Housekeeping Services Department of Ruger Clinic, had $100,000 in direct costs during the year.
Department Revenue HK Hours
Adult Services $3,000,000 1,500
Pediatric Services $1,500,000 3,000
Other Services $ 500,000 500
Total $5,000,000 5,000
- What is the value of the cost pool?
- Which of the two cost drivers is better? Patient service revenue or housekeeping hours? Why?
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