Hall Regional Hospital plans to use activity-based costing to assign hospital indirect costs to the care of patients. The hospital has identified the following activities and activity rates for the hospital indirect costs:

The records of two representative patients were analyzed, using the activity rates. The activity information associated with the two patients is as follows:

a. Determine the activity cost associated with each patient.
b. Why is the total activity cost different for the twopatients?

Transcribed Image Text:

Activity Rate $125 per day $180 per image $15 per physician order $90 per test $1,200 per operating room hour Activity Room and meals Radiology Pharmacy Chemistry lab Operating room Number of days Number of images Number of physician orders Number of tests Number of operating room hours Patient Mims 2 days 4 images 6 orders 2 tests Patient Slater 4 days 7 images 10 orders 5 tests 3.1 hours 0.9 hou