Business, 13.03.2020 05:57, anamatiascamaja
Riddick Radiology Center (RRC) performs X-rays, ultrasounds, computer tomography (CT) scans, and magnetic resonance imaging (MRI). RRC has developed a reputation as a top radiology center in the state. RRC has achieved this status because it constantly reexamines its processes and procedures. RRC has been using a single, facility-wide overhead allocation rate. The vice president of finance believes that RRC can make better process improvements if it uses more disaggregated cost information. She says, "We have state-of-the-art medical imaging technology. Can't we have state-of-the-art accounting technology?"
Technician Depreciation Materials Indirect costs Total Budgeted
labor budgeted cost per
costs service
X-rays $73,500 6,300 22,600 110,250 $212,650 $40.27
Ultrasound $113,100 276,500 16,100 169,650 $575,350 $152.21
CT scan $160,720 466,200 23,600 241,080 $891,600 $323.04
MRI $101,000 851,000 31,000 151,500 $1,134,500 $497.59
(A) Start by calculating the budgeted overhead rate for total indirect costs based on total labor. First, select the formula, then enter the applicable amounts and calculate the rate. (Round your answer to two decimal places, X. XX. Abbreviations used: DC = Direct cost, DL = Direct labor, $ = dollar.) Total indirect costs / Total technician labor cost = Budgeted overhead rate $672,480 / $448,320 = $1.50 per DL $.
(B) Now calculate the total budgeted costs for each service and the budgeted cost per each service using direct technician labor costs as the allocation basis.
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Riddick Radiology Center (RRC) performs X-rays, ultrasounds, computer tomography (CT) scans, and mag...
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