#### Using Table 8.21, allocate the indirect costs in the indirect cost pool using total direct costs as the method or base. What is the total cost, or full cost, of each of the four programs?

CAN SOMEONE PLEASE HELP ME? IT’S A FINANCING OF HEALTHCARE FACILITIES QUESTION

Exercise 8.1

Using Table 8.21, allocate the indirect costs in the indirect cost pool using total

direct costs as the method or base. What is the total cost, or full cost, of each of the

four programs? Assuming the total outputs (or units of service) remain the same

for the visiting nurse program, the homemaker program, and the home-delivered

meals program and that the specialized transportation program will make 9,000

person trips during the year, what is the cost per output (or unit of service) for each

of the four programs? Assuming that all four programs share the same outcome

measure and that the total number of outcomes (125) remains the same, what is the

cost per outcome?

Exercise 8.2

Using Table 8.21, allocate the indirect costs in the indirect cost pool using salaries

and wages as the method or base. What is the total cost, or full cost, of each of the

four programs? Assuming the total outputs (or units of service) remain the same

for the visiting nurse program, the homemaker program, and the home-delivered

meals program and that the specialized transportation program will make 9,000

person trips during the year, what is the cost per output (or unit of service) for each

of the four programs? Assuming that all four programs share the same outcome

measure and that the total number of outcomes (125) remains the same, what is the

cost per outcome?

TABLE 8.21 Houston Home Care Agency Cost Allocation Plan Format

Budget Line Items

Salaries and Wages

Executive director

Financial manager

3 secretaries

Nursing coordinator (N)

4 nurses (N)

Homemaker coordinator (H)

15 homemakers

Home-delivered meals

coordinator (M and T)

2 van drivers (M and T)

Salaries and Wages (Total)

Employee-Related Expenses

(@ 22% of salaries & wages)

Other Operating Expenses

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