A.Allocation BasisThe assignment includes the original budgeted cost, so don't ignore the original costs. The original budget included the total overhead for all services. Remember overhead is Administration, Maintenance, Sanitation, and Utilities. Step One:Calculate the Allocated Cost is to determine the allocated overhead per procedure (green boxes).To determine the overhead rate for individual service, divide the total overhead (Administration, Maintenance, Sanitation, and Utilities) by the total technical labor. This will give you the proportionate calculated direct labor rate. X-Rays Ultrasound CT MRI Total Tech Labor 62,000 101,000 155,000 103,000 421,000 Depreciation 42,240 256,000 424,960 876,800 1,600,000 Materials 22,600 16,400 23,600 31,500 94,100 Administration 20,000 Maintenance 250,000 Sanitation 252,500 Utilities 151,100 Allocated Overhead - Total Cost 126,840 373,400 603,560 1,011,300 2,788,700 New TOTAL COST Number of Procedures 3,842 4,352 2,924 2,482 13,600 Budgeted Cost per Service Step Two:Multiple the technical labor total for each procedure by the direct labor rate calculated in Step One. Repeat for each procedure type. This is the new allocated overhead per procedure. Add the allocated overhead to the total cost for the new total cost.Step Three:Divide the new total cost by the number of procedures. B.Activity-Based Costing (ABC)Step One:While we are using the same original budget for calculations, we need to start by calculating the new activity-based overhead rates. Overhead is determined by the cost amount divided by the cost driver. Activity rate