Wagner Hospital allocates overhead costs to departments such as pediatrics, maternity, psychiatric, and so on. Wagner...

Transcribed Image Text:

Wagner Hospital allocates overhead costs to departments such as pediatrics, maternity, psychiatric, and so on. Wagner assigns costs to each separate department for services to its patients (such as lab tests, dietary, and laundry) and for administrative services. For the enti year ended June 30, 2012, the OR at Wagner Hospital charged each patient an average of $9 per operation and had revenue of $1,749,300. Expenses charged by the hospital to the OR for the year ended June 30, 2012, were as follow Basis of allocation Operations Space Custodial engineering Laundry Laboratory, other than direct charges to patients Pharmacy Repairs and maintenance General administration Rent Finance office Bad debt expense Other Operations 1000-1400 1401-1700 1701-2372 2373-2555 2556-2738 11 12 12 13 14 6 6 7 ∞∞∞ 8 $28,000 47,800 The only personnel directly employed by Wagner's OR are supervising nurses, scrub nurses circulating nurses. The hospital OR staffing is based on total operations. Hospital requireme beginning at the minimum expected level of operations follow: Annual Number of Scrub Nurses Circulating Nurses Supervising Nurses 8 83,800 95,200 40,000 47,000 29,700 $371,500 $12 N2233 7 131 275 25 $453 Wagner Hospital allocates overhead costs to departments such as pediatrics, maternity, psychiatric, and so on. Wagner assigns costs to each separate department for services to its patients (such as lab tests, dietary, and laundry) and for administrative services. For the enti year ended June 30, 2012, the OR at Wagner Hospital charged each patient an average of $9 per operation and had revenue of $1,749,300. Expenses charged by the hospital to the OR for the year ended June 30, 2012, were as follow Basis of allocation Operations Space Custodial engineering Laundry Laboratory, other than direct charges to patients Pharmacy Repairs and maintenance General administration Rent Finance office Bad debt expense Other Operations 1000-1400 1401-1700 1701-2372 2373-2555 2556-2738 11 12 12 13 14 6 6 7 ∞∞∞ 8 $28,000 47,800 The only personnel directly employed by Wagner's OR are supervising nurses, scrub nurses circulating nurses. The hospital OR staffing is based on total operations. Hospital requireme beginning at the minimum expected level of operations follow: Annual Number of Scrub Nurses Circulating Nurses Supervising Nurses 8 83,800 95,200 40,000 47,000 29,700 $371,500 $12 N2233 7 131 275 25 $453

Answer rating: 100% (QA)

To calculate the operating income for the OR at Wagner Hospital we first need to determine the total ... View the full answer