Boone Hospital Wants to Determine,to the Extent Possible,the Actual Cost

question 10

Essay

Boone Hospital wants to determine,to the extent possible,the actual cost for each patient stay.It is a general health care facility with all basic services but does not perform specialized services such as organ transplants.
Required:
Complete the following table by
a.Classifying each cost as a direct or indirect cost with respect to each patient.
b.Classifying each item as fixed or variable with respect to the number of patient days (sum of days each patient was in hospital)the hospital incurs.

---

Definitions:

Units per Year

A measure of production output or activity volume, indicating the number of units produced or sold within a year.

ROI Computation

The calculation of Return on Investment, which measures the gain or loss generated on an investment relative to the amount of money invested.

Net Book Value

The value of an asset after accounting for depreciation or amortization found on a company's balance sheet.

Operating Expense

Expenses incurred from a company's operational activities, excluding cost of goods sold, such as selling, general, and administrative expenses.