FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Activity-Based Product Costing

Suppose that a surgical ward has gathered the following information for four nursing activities and two types of patients:

    Patient Category    
  Driver Normal Intensive Activity Rate
Treating patients Treatments 6,400 8,000 $4.00  
Providing hygienic care Hygienic hours 4,800 17,600 5.00  
Responding to requests Requests 32,000 80,000 2.00  
Monitoring patients Monitoring hours 6,000 72,000 3.00  

Required:

1.  Determine the total nursing costs assigned to each patient category.

  Costs Assigned
Normal $
Intensive $

2.  Output is measured in patient days. Assuming that the normal patient category uses 8,000 patient days and the intensive patient category uses 6,400 patient days, calculate the nursing cost per patient day for each type of patient. (Round to two decimal places.)

Normal $ per patient day
Intensive $ per patient day

3.  Conceptual Connection: The supervisor of the surgical ward has suggested that patient days is the only driver needed to assign nursing costs to each type of patient. Calculate the charge per patient day (rounded to the nearest cent) using this approach.
$ per patient day

### Cost Assignment Exercise

#### Data Table
This table displays the different activities related to patient care, categorized by activity drivers, types of patients (normal and intensive), and corresponding activity rates.

| Activity                 | Driver          | Normal | Intensive | Activity Rate |
|--------------------------|-----------------|--------|-----------|---------------|
| Treating patients        | Treatments      | 6,400  | 8,000     | $4.00         |
| Providing hygienic care  | Hygienic hours  | 4,800  | 17,600    | $5.00         |
| Responding to requests   | Requests        | 32,000 | 80,000    | $2.00         |
| Monitoring patients      | Monitoring hours| 6,000  | 72,000    | $3.00         |

#### Required Tasks:

1. **Determine the total nursing costs assigned to each patient category.**

   **Costs Assigned**
   - Normal: $[____] ×
   - Intensive: $[____] ×

2. **Calculate nursing costs per patient day.**

   Output is measured in patient days. Assuming:
   - Normal patient category: 8,000 patient days
   - Intensive patient category: 6,400 patient days
   
   Calculate the nursing cost per patient day for each type (rounded to two decimal places).

   - Normal: $[____] × per patient day
   - Intensive: $[____] × per patient day

3. **Conceptual Connection:**

   The supervisor of the surgical ward has suggested that patient days is the only driver needed to assign nursing costs to each type of patient. Calculate the charge per patient day (rounded to the nearest cent) using this approach.

   - $[____] per patient day

---
Please consult the table to input the appropriate values in the boxes provided. If additional guidance is needed, refer to the "Check My Work" section for hints or solutions.
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Transcribed Image Text:### Cost Assignment Exercise #### Data Table This table displays the different activities related to patient care, categorized by activity drivers, types of patients (normal and intensive), and corresponding activity rates. | Activity | Driver | Normal | Intensive | Activity Rate | |--------------------------|-----------------|--------|-----------|---------------| | Treating patients | Treatments | 6,400 | 8,000 | $4.00 | | Providing hygienic care | Hygienic hours | 4,800 | 17,600 | $5.00 | | Responding to requests | Requests | 32,000 | 80,000 | $2.00 | | Monitoring patients | Monitoring hours| 6,000 | 72,000 | $3.00 | #### Required Tasks: 1. **Determine the total nursing costs assigned to each patient category.** **Costs Assigned** - Normal: $[____] × - Intensive: $[____] × 2. **Calculate nursing costs per patient day.** Output is measured in patient days. Assuming: - Normal patient category: 8,000 patient days - Intensive patient category: 6,400 patient days Calculate the nursing cost per patient day for each type (rounded to two decimal places). - Normal: $[____] × per patient day - Intensive: $[____] × per patient day 3. **Conceptual Connection:** The supervisor of the surgical ward has suggested that patient days is the only driver needed to assign nursing costs to each type of patient. Calculate the charge per patient day (rounded to the nearest cent) using this approach. - $[____] per patient day --- Please consult the table to input the appropriate values in the boxes provided. If additional guidance is needed, refer to the "Check My Work" section for hints or solutions.
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