Question

eBook * Show Me How Calculator Predetermined Factory Overhead Rate Poehling Medical Center has a single operating room that is used by local physicians to perform surgical procedures. The cost of using the operating room is accumulated by each patient procedure and includes the direct materials costs (drugs and medical devices), physician surgical time, and operating room overhead. On January 1 of the current year, the annual operating room overhead is estimated to be: Disposable supplies $367,200 Depreciation expense 66,200 Utilities 38,500 Nurse salaries 551,400 Technician wages 180,700 Total operating room overhead $1,204,000 The overhead costs will be assigned to procedures, based on the number of surgical room hours. Poehling Medical Center expects to use the operating room an average of eight hours per day, seven days per week. In addition, the operating room will be shut down two weeks per year for general repairs. a. Determine the predetermined operating room overhead rate for the year. per hour b. Bill Harris had a 5-hour procedure on January 22. How much operating room overhead would be charged to his procedure, using the rate determined in part (a)? c. During January, the operating room was used 194 hours. The actual overhead costs incurred for January were $81,600. Determine the overapplied operating overhead or underapplied operating overhead for the period. overapplied T. Check My Wor a. Use estimated annual operating room hours and estimated annual operating room overhead to find the predetermined overhead rate. b. Apply the predetermined rate to the hours of actual surgery. C. Apply the predetermined rate to the actual hours. Previous Next Check My Work

Answer 1

@ The pre determined operating room overhead rate for the year is calculceted below. Total operating room overhead = $1204000 Number of hours are calculated below 1 year = 952 weeks - 2 weeks coperation room shut down) 1 year - So gekt I year - 50x 7 days -350 days. 1 year = 350daus x 8 hours per day 1 year - 2800 hours operating room overhead per hour= $1204000 2800 hours = $430 u operating room overhead changed to Bill Harris - Shours X $ 430 - $2150 @ Budgeted operating room overheads - 194 hours X $ 430 - $83430 Actwal operating room overheads 2881,600 Budget operating room overheads Actual. operating room overheads over applied overbeads = $ 83430-381600 = $ 1820