This was the problem given to us by out professor. I hope this will help sa mga students na nahihirapan sa accounting.
I include my computation. :D
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Columbus Hospital operates a general hospital but rents
space and beds to separate entities for specialized treatment such as
pediatrics, maternity, psychiatric etc. Columbus charges each separate entity
for common services to its patients like meals and laundry and for all
administrative services such as billings , collections. All uncollectible
accounts are charged directly to the entity. Space and bed rentals are fixed for
the year.
For the entire year ended June 30, the pediatrics department
at Columbus hospital charged each patient an average of P65 per day, had a
capacity of 60 beds, operated 24 hours per day for 365 days , and had revenue
of P1,138,800.
Expenses charged by the hospital to the pediatrics
department for the year ended June 30 were:
Basis of Allocation:
Patient Days Bed Capacity
Dietary ………………………………………....…P42,952
Janitorial………………………………………………………................…P12,800
Laundry……………………………………….......P28,000
Lab, others ……………………………………......P47,800
Pharmacy ………………………………................P33,800
Repairs and maintenance …………………............P5,200 ……………….P7,140
General administrative services .......................................................…........P131,760
Rent ………………………………………………………………………..P275,350
Billings and collections ……………………...........P40,000
Bad debt expense …………………………............P47,000
Others ………………………………………..........P18,048 ………………P25,980
Total ………………………………………............P262,800……………..P453,000
Dietary ………………………………………....…P42,952
Janitorial………………………………………………………................…P12,800
Laundry……………………………………….......P28,000
Lab, others ……………………………………......P47,800
Pharmacy ………………………………................P33,800
Repairs and maintenance …………………............P5,200 ……………….P7,140
General administrative services .......................................................…........P131,760
Rent ………………………………………………………………………..P275,350
Billings and collections ……………………...........P40,000
Bad debt expense …………………………............P47,000
Others ………………………………………..........P18,048 ………………P25,980
Total ………………………………………............P262,800……………..P453,000
The only personnel directly employed by the Pediatrics
Department are supervising nurses, nurses and aides. The hospital has minimum
personnel requirements based on total annual patient days. Hospital requirements
beginning at the minimum, expected level of operation follows:
Annual Patient Days
|
Aides
|
Nurses
|
Supervising nurses
|
10,000 -14,000
14,001 - 17,000
17,001 - 23,725
23,726 - 25,550
25,551 - 27,375
27,376-
29,200
|
21
22
22
25
26
29
|
11
12
13
14
15
16
|
4
4
4
5
5
6
|
The staffing levels below represent full-time equivalents,
and it should be assumed that the Pediatrics departments always employs only
the minimum number of required fulltime equivalent personnel.
Annual salaries for each class of employee follow:
supervising nurses, P18,000 ;nurses, P13,000; and aides, P5,000. Salary expense
for the year ended June 30 for supervising nurses, nurses, and aides was
P72,000, P 169,000 and P110,000, respectively.
The Pediatrics Dept. operated at 100% capacity during 111
days of the past year. It is estimated that during 90 of these capacity days,
the demand average 17 patients more than capacity and even went as high as 20
patients more on some days. The hospital has an additional 20 beds available
for rent for the coming fiscal year.
1. The
variable expense per day is
a. 15.08
b. 12.50
c. 15.00
d.50.00
Variable
cost per patient day = Total Variable cost for the year / total patient day
262,800/17,508
= 15
No. of
patient days = Total Revenue for the year/ revenue per patient day
1,138,800 /
65 per day = 17,508
2. The
Contribution margin per patient day is
a. 49.92
b. 52.50
c. 50.00
d. 52.00
Contribution
Margin = revenue/patient day – variable cost/patient day
65 per day –
15 = 50 per patient day
3. How many patient
days are necessary to cover fixed cost for bed capacity and supervisory nurses?
a. 9,500
b. 11,500
c. 12,500
d. 10,500
Fixed costs for bed
capacity P
453,000
Salary, supervisory
nurse 72,000
Total P
525,000
Number of patient days
required to cover fixed costs for bed capacity and salaries of supervisory
nurse
525000÷
50 = 10,500
4. The
number of patients days need to cover total cost
a. 14,200
b. 15,200
c. 15, 820
d. 14, 220
First Range:
Fixed costs based on capacity
|
453,000
|
|
Salaries:
|
||
Aides 21 x 50,000
|
105,000
|
|
Nurses 11 x 130,000
|
143,000
|
|
Supervisor 4 x 180,000
|
72,000
|
320,000
|
Total
|
773,000
|
Breakeven
calculation: 773,000÷
50 15,460
The calculated breakeven
point of 15,460 is invalid because the number falls under the second range
wherein the amount of fixed costs that had been used are not relevant to that
range.
Second Range (Final calculation):
Total fixed cost, 773,000
Total fixed cost, 773,000
Additional fixed cost:
1 aide 5,000
1
nurse 13,000
Total 791,000
Breakeven in patient days:
791,000 ÷
50 158,240
5. If the
pediatrics department rented additional beds and all other factors remain the
same as in the last year, what would be the increased in revenue?
a. 99, 450
b. 87,750
c. 105,450
d. 89, 750
Additional revenues if 20
beds are rented:
90 days @ 17 patient days x
65 99,450
6.
Continuing to consider the 20 additional rented beds, the increased in total
variable cost applied per patient is
a. 22,935
b. 22,950
c. 22,965
d. 23,935
Increase in variable cost
should be calculated based on additional patient days for 90 days at P15 per
patient day.
17 beds x 90 days x P15 P22,
950
7. Refer to
the information given in the problem. What is the increased fixed cost for bed
capacity, given the increased bed number of beds?
a. 151,000
b. 173,950
c. 147,000
d. 152,000
The increase in fixed cost
based on bed capacity:
453,000 ÷ 60 x
20 P151,000
