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Author Question: The fixed costs of operating the maintenance facility of General Hospital are $4,500,000 annually. ... (Read 70 times)

shofmannx20

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on: Mar 6, 2021
The fixed costs of operating the maintenance facility of General Hospital are $4,500,000 annually. Variable costs are incurred at the rate of $30 per maintenance-hour. The facility averages 40,000 maintenance-hours a year. Budgeted and actual hours per user for 2017 are as follows: 

Budgeted hoursActual hours
Building and grounds10,00012,000
Operating and emergency8,0008,000
Patient care21,00022,000
Administration1,0001,200
Total40,00043,200

Assume that budgeted maintenance-hours are used to calculate the allocation rates. 

Required:
a.  If a single-rate cost-allocation method is used, what amount of maintenance cost will be budgeted for each department?
b.  If a single-rate cost-allocation method is used, what amount of maintenance cost will be allocated to each department based on actual usage?
c  .If a dual-rate cost-allocation method is used, what amount of maintenance cost will be budgeted for each department?
d.  If a dual-rate cost-allocation method is used, what amount of maintenance cost will be allocated to each department based on actual usage? Based on budgeted usage for fixed operating costs and actual usage for variable operating costs?
Horngren's Cost Accounting: A Managerial Emphasis ¦ Datar, Rajan ¦ 16th Edition
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Marked as best answer by shofmannx20 on Mar 6, 2021

JCABRERA33

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Reply #1 on: Mar 6, 2021
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shofmannx20

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Reply 2 on: Mar 6, 2021
Excellent

scikid

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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