Question

Q3. CC Hospital uses a job costing system for all patients who have surgery. In March, the pre-operating room (PRE-UP) and operating room (OR) had budgeted allocation bases of 4,000 nursing hours, and 2,000 nursing hours, respectively. The budgeting nursing overhead charges for each department for the month were Shs. 168,000 and Shs. 132,000 respectively. The hospital flour for surgery patients had budgeted overhead costs of Shs.1,200,000 and 15,000 nursing hours for the month. For patient Fred Amayo, actual hours incurred were eight and four hours respectively in the PRE-OP and OR rooms. He was in hospital for 4 days (96 hours). Other costs related to Fred Amayo were: PRE-OP OR In-room Costs Costs Costs Shs. Shs. Shs. Patient Medicine Direct Nursing Time 1,000 2,000 3,000 200 500 2,400 The hospital uses a budgeted overhead for applying overhead to patients Required: What is the total cost of the stay of patient Fred Amayo? 4. (a)What is budgeting camerm

Answer 1

Answer:-

Nursing overhead rate Pre-OP= $168,000/ 4,000 hrs.= $42.00 per hour

Nursing overhead rate OR= $132,000/ 2,000 hrs= $66.00 per hour

Nursing overhead rate surgery floor= $1,200,000/15,000 hours= $80 per hour

Patient Fred Adams Nursing Overhead:

Pre-OP= ($42 x 8)= $336 OR= ($66 x 4) = $264

In Room = ($80 x96) = $7,680

Pre-OP total= $200 + $1,000 + $336= $1,536

OR total= $500 + $2000 + $264 = $2,764

In Room total= $2,400 + $3,000 + $7,680 =$13080

TOTAL COST= $1,536+ $2,764+$13080= $17,380

TOTAL COST=$17,380

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