Crosstown Health Center runs two programs: drug addict rehabilitation and after- care (counseling and support of patients after release from a mental hospital). The center's budget for 2017 follows. Professional salaries: 4 physicians x $150,000 12 psychologists x $75,000 16 nurses x $30,000 Medical supplies $600,000 900,000 480,000 $1,980,000 242,000 Rent and clinic maintenance 138,600 Administrative costs to manage patient charts, food, laundry Laboratory services Total 484,000 92,400 $2,937,000 Kim Yu, the director of the center, is keen on determining the cost of each program. Yu compiles the follow- ing data describing employee allocations to individual programs: Total Employees Drug Aftercare Physicians Psychologists 12 Nurses 10 16 Yu has recently become aware of activity-based costing as a method to refine costing systems. She asks her accountant, Gus Gates, how she should apply this technique. Gates obtains the following budgeted information for 2017: Drug Total Aftercare Square feet of space occupied by each program Patient-years of service Number of laboratory tests 9,000 12,000 21,000 50 60 110 700 1,400 2,100

There are several different types of operating budgets. Which of these types of budgets do you think would be best for a hospital-based lab and why? ( 4 types of budget: (1) incremental, (2) activity-based, (3) value proposition, and (4) zero-based)

Which of the following is an accurate statement about project costs? Group of answer choices Indirect costs like office space and utilities must be excluded) Budgets cannot be padded with a “miscellaneous” budget item. The budget is an estimate but may change as the project develops. Costs must be documented in tables to help readers focus on specific items.

What are support departments, and why are their costs allocated to other departments? What process is used to allocate support department costs?