Western Dialysis Clinic
Advanced Management Accounting, R. S. Kaplan, A. A. Atkinson,
International Edition, Third Edition, Prentice Hall International, Inc, 1998
p. 116.
Answer all four requirements of the case study. In addition to these requirements you are recommended to exhibit your ability to:
1) Critically evaluate the advantages and drawbacks of traditional costing systems.
2) Compare activity-based costing systems to traditional costing systems.
3) Analyze the circumstances and provide arguments with solid numbered reasoning to support appropriateness of any of the two systems.
4) Foresee and critically assess the implications of moving from one system to another. Table 1
Clinic income statement Total HD PD Revenues Number of patients 164 102 62 Number of treatments 34 967 14 343 20 624 Total revenue $3 006 775,0 $1 860 287,0 $1 146 488,0 Supply costs Standard supplies (drugs, syringes) 664 900 512 619 152 281 Episodic supplies (for special conditions) 310 695 98 680 212 015 Total supply costs 975 595 611 299 364 296 Service costs General overhead (occupancy, administration) 785 825 466 610 319 215 Facility costs (rent,depreciation) 233 226 146 932 86 294 Administration and support staff 354 682 220 595 134 087 Communications systems and medical records 157 219 64 489 92 730 Utilities 40 698 34 593 6 105 Durable equipment (maintenance, depreciation) 137 046 116 489 20 557 Nursing services (RNs,LPNs, nursing administrators, equipment technicians) 883 280 750 788 132 492 Total
International Edition, Third Edition, Prentice Hall International, Inc, 1998
p. 116.
Answer all four requirements of the case study. In addition to these requirements you are recommended to exhibit your ability to:
1) Critically evaluate the advantages and drawbacks of traditional costing systems.
2) Compare activity-based costing systems to traditional costing systems.
3) Analyze the circumstances and provide arguments with solid numbered reasoning to support appropriateness of any of the two systems.
4) Foresee and critically assess the implications of moving from one system to another. Table 1
Clinic income statement Total HD PD Revenues Number of patients 164 102 62 Number of treatments 34 967 14 343 20 624 Total revenue $3 006 775,0 $1 860 287,0 $1 146 488,0 Supply costs Standard supplies (drugs, syringes) 664 900 512 619 152 281 Episodic supplies (for special conditions) 310 695 98 680 212 015 Total supply costs 975 595 611 299 364 296 Service costs General overhead (occupancy, administration) 785 825 466 610 319 215 Facility costs (rent,depreciation) 233 226 146 932 86 294 Administration and support staff 354 682 220 595 134 087 Communications systems and medical records 157 219 64 489 92 730 Utilities 40 698 34 593 6 105 Durable equipment (maintenance, depreciation) 137 046 116 489 20 557 Nursing services (RNs,LPNs, nursing administrators, equipment technicians) 883 280 750 788 132 492 Total