Mount Ranier General Hospital serves three counties in the state of Washington. The hospital is a nonprofit
Question:
Mount Ranier General Hospital serves three counties in the state of Washington. The hospital is a nonprofit organization which is supported by patient billings, county and state funds, and private donations. The hospital’s organization chart follows.
The following cost information has been compiled for August.
Required:
1. Prepare a set of cost performance reports similar to Exhibit 12–4. The report should have six columns, as in Exhibit 12–4. The first four columns will have the same headings as those used above. The last two columns will have the following headings: Variance—August, and Variance—Year to Date.
Since all of the information in the performance reports for Mount Ranier General Hospital is cost information, you do not need to show these data in parentheses. Use F or U to denote whether each variance in the reports is favorable or unfavorable.
2. Using arrows show the relationships between the numbers in your performance reports for Mount Ranier General Hospital. Refer to Exhibit 12–4 for guidance.
3. Put yourself in the place of the hospital’s administrator. Which variances in the performance reports would you want to investigate further?Why?
Step by Step Answer:
Managerial Accounting Creating Value in a Dynamic Business Environment
ISBN: 978-0078025662
10th edition
Authors: Ronald Hilton, David Platt