A partial list of Foothills Medical Centers costs follows: a. Advertising hospital services on television b. Blood
Question:
A partial list of Foothills Medical Center’s costs follows:
a. Advertising hospital services on television
b. Blood tests
c. Cost of drugs used for patients
d. Cost of maintaining the staff and visitors’ cafeteria
e. Cost of building a new heart wing
f. Cost of X-ray test
g. Depreciation of patient rooms
h. Depreciation of X-ray equipment
i. Doctor’s fee
j. General maintenance costs of the hospital
k. Improvements on the employee parking lot
l. Intravenous solutions used for patients
m. Laundry services for operating room personnel
n. Operating room supplies used on patients (catheters, sutures, etc.)
o. Overtime incurred in the Patient Records Department due to a computer failure
p. Patient meals
q. Nurses’ salaries
r. Salary of the nutritionist
s. Salary of intensive care personnel
t. Training costs for nurses
u. Utility costs of the hospital
Instructions
1. What would be Foothills Medical Center’s most logical definition for the final cost object?
2. Identify whether each of the costs is to be classified as direct or indirect. For purposes of classifying each cost as direct or indirect, use the patient as the cost object.
Step by Step Answer:
Financial And Managerial Accounting
ISBN: 9781337119207
14th Edition
Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac