In the Past,Hypochondriac Hospital Allocated All of Its Overhead Costs

question 15

Multiple Choice

In the past,Hypochondriac Hospital allocated all of its overhead costs to patients based on nursing time.Hypochondriac has decided to switch to an activity based costing system using three activity cost pools.Information related to the new system is as follows: Data concerning two patients follows: Under the new activity-based costing system,how much overhead cost would be assigned to each patient?

• A)Option A
• B)Option B
• C)Option C
• D)Option D

---

Definitions:

Debit

An accounting entry that increases asset or expense accounts, or decreases liability, equity, or revenue accounts.

Credit

An accounting entry on the right side of an account ledger, recording increases in liabilities, equity, and revenue, or decreases in assets and expenses.

Recording Process

The act of documenting financial transactions systematically in the books of accounts of a business.

Journal

An elaborate log that captures every financial transaction of an enterprise, initially entered prior to its transfer to the accounts within the general ledger.