Which of the following applications of the rules of debit and ...

[Capo]

Which of the following applications of the rules of debit and credit is true?
 a. decrease Prepaid Insurance with a credit and the normal balance is a credit
  b. increase Accounts Payable with a credit and the normal balance is a debit
  c. increase Equipment with a debit and the normal balance is a debit
  d. decrease Cash with a debit and the normal balance is a credit

Question 2

Health Care County Hospital uses an indirect job-costing system for all patients. In June, the budgeted nursing care charges for each department and budgeted allocation bases of nursing days are as follows:
 
  June Critical Care Special Care General Care
  Budgeted nursing costs 2,480,000 1,644,000 1,280,400
  Budgeted nursing days 5,000 4,000 8,000
 
  Patient Ms. Pinto spent six days in critical care, eight days in special care. She was shifted back to critical care due to an emergency for 6 days and finally the remainder of the month was spent in general care.
 
  Required:
  a. Determine the budgeted overhead rate for each department.
  b. What are the total charges to Ms. Pinto if she was in the facility the entire month?

[dominiqueenicolee]

Answer to Question 1

c

Answer to Question 2

Answer:
a. Overhead rate critical care = 2,480,000/5,000 nursing days = 496.00 per day
Overhead rate special care = 1,644,000/4,000 nursing days = 411.00 per day
Overhead rate general = 1,280,400/8,000 nursing days = 160.05 per day

b. Ms. Graves:
Critical care 496.00  6 days = 2,976.00
Special care 411.00  8 days = 3,288.00
Critical care 496.00  6 days = 2,976.00
General care 160.05  10 days = 1600.50
Total overhead charges 10,840.50