Cowley County Hospital uses a job-costing system for all patients who have surgery. In March, the pre-operating room (PRE-OP) and operating room (OR) had budgeted allocation bases of 4,000 nursing hours and 2,000 nursing hours, respectively.

Please explain answers, so I know how to do the problem. Thank you.

Job Order Costing

Cowley County Hospital uses a job-costing system for all patients who have surgery. In March, the pre-operating room (PRE-OP) and operating room (OR) had budgeted allocation bases of 4,000 nursing hours and 2,000 nursing hours, respectively. The budgeted nursing overhead charges for each department for the month were $168,000 and $132,000, respectively. The hospital floor for surgery patients (In-Room) had budgeted overhead costs of $1,200,000 and 15,000 nursing hours for the month. For patient Fred Adams, actual hours incurred were eight and four hours, respectively, in the PRE-OP and OR rooms. He was in the hospital for 4 days (96 hours). Other costs related to Adams were:

                                         PRE-OP                  OR                   In-room

                                         Costs                    Costs                  Costs

Patient medicine               $ 200                    $ 500                  $2,400

Direct nursing time           $1,000                  $2,000                 $3,000

The hospital uses a budgeted overhead rate for applying overhead to patient stays.

Required:

What is the total cost of the stay of patient Fred Adams?

Part 1: Rates

a.) Nursing overhead rate PRE-OP

b.) Nursing overhead rate OR         

c.) Overhead rate for surgery floor

Part 2: Patient Cost

Patient Fred Adams:

                                                 PRE-OP            OR                 In-room                Totals

Patient medicine                    

Direct nursing time               

Nursing overhead:

PRE-OP

OR

In-room

Total