User Account

All Pages

Cost management, Project Management

Assignment Help:
Dr. Sherry Bird is employed by Dental Associates. Dental Associates recently installed a computerized job-order costing system to help monitor the cost of its services. Each patient is treated as a job and assigned a job number when he or she checks in with the receptionist. The receptionist-bookkeeper notes the time the patient enters the treatment area and when the patient leaves the area. This difference between the entry and exit times is the number of patient hours used and the direct labor time assigned to the dental assistant. (A dental assistant is constantly with the patient.) The direct labor time assigned to the dentist is 50 percent of the patient hours. (The dentist typically splits her time between two patients.)
The chart filled out by the dental assistant provides additional data that is entered into the computer. For example, the chart contains service codes that identify the nature of the treatment, such as whether the patient received a crown, a filling, or a root canal. The chart not only identifies the type of service but its level as well. For example, if a patient receives a filling, the dental assistant indicates (by a service-level code) whether the filling was one, two, three, or four surfaces. The service and service-level codes are used to determine the rate to be charged to the patient. The costs of providing different services and their levels also vary.
Costs assignable to a patient consist of materials, labor, and overhead. The types of materials used—and the quantity—are identified by the assistant and entered into the computer by the bookkeeper. Material prices are kept on file and accessed to provide the necessary cost information. Overhead is on the basis of patient hours. The rate used by Dental Associates is $20 per patient hour. Direct labor cost is also computed using patient hours and the wage rates of the direct laborers. Dr. Bird is paid an average of $36 per hour for her services. Dental assistants are paid an average of $6 per hour. Given the treatment time, the software program calculates and assigns the labor cost for the dentist and her assistant; overhead cost is also assigned using the treatment time and the overhead rate.
The overhead rate does not include a charge for any X-rays. The X-Ray Department is separate from dental services; X-rays are billed and costed separately. The cost of an X-ray is $3.50 per film; the patient is charged $5 per film. If cleaning services are required, cleaning labor costs $9 per patient hour.
Glen Johnson, a patient (Job 267), spent 30 minutes in the treatment area and had a two-surface filling. He received two Novocaine shots and used three ampules of amalgam. The cost of the shots was $1. The cost of the amalgam was $3. Other direct materials used are insignificant in amount and are included in the overhead rate. The rate charged to the patient for a two-surface filling is $45. One X-ray was taken.

Required:
1. Prepare a job-order cost sheet for Glen Johnson. What is the cost for providing a two-surface filling? What is the gross profit earned? Is the X-ray a direct cost of the service? Why are the X-rays costed separately from the overhead cost assignment?
2. Suppose that the patient time and associated patient charges are given for the following fillings:

1-Surface 2-Surface 3-Surface 4-Surface
Time 20 min 30 min 40 min 50 min
Charge $35 $45 $55 $65

Compute the cost for each filling and the gross profit for each type of filling. Assume that the cost of Novocaine is $1 for all fillings. Ampules of amalgam start at two and increase by one for each additional surface. Assume also that only one X-ray film is needed for all four cases. Does the increase in billing rate appear to be fair to the patient? Is it fair to the dental corporation?

Related Discussions:- Cost management

Risk management techniques and project timeplan creation, I have an assignm...

I have an assignment to submit in the above mentioned topics. Please respond me as soon as possible with the required info and i will send you the assignment details after our mutu

Principle of parity of authority and responsibility, What is the principle ...

What is the principle of parity of authority and responsibility? The principle of parity of authority and responsibility states which in delegating; managers should match the r

Components of participative management, COMPONENTS OF PARTICIPATIVE MANAGEM...

COMPONENTS OF PARTICIPATIVE MANAGEMENT: The involvement of staff in the decision making process of the organization and having increased awareness of the organization's purpos

Research process, Research Process: Research process consists of a numbe...

Research Process: Research process consists of a number of closely related activates. But such activities overlap continuously and do not follow a strictly prescribed sequence.

Project strategy , what is the relationship between strategy and project ma...

what is the relationship between strategy and project management. what part do leadership and governance play in project. 3. What is the role of portfolio management and programme

Demonstrate a critical approach to management theories, Your Integrated Man...

Your Integrated Management Project will be marked initially by a tutor. The marked project may then moderated by another tutor to ensure consistency between markers. A sample of th

Project contracts, Understanding Project Contracts  Project contracts i...

Understanding Project Contracts  Project contracts invariably involve construction and therefore we will discuss contracts necessarily involving construction in this section. I

What are the distinguishing characteristics of a project, Question : (a...

Question : (a) What are the distinguishing characteristics of a project? (b) What are the four types of consequences of risk? (c) Explain what you understand by the term

Market strategy development, Q. Market Strategy Development? Market str...

Q. Market Strategy Development? Market strategy development would require the study of the markets for potential consumers. It would also involve the study of the market for e

Explain the tool of total quality improvement, Question: As the Managin...

Question: As the Managing Director of your organization, you have been analyzing other institutions that you regard as competitors. Extrapolating your current position up to t

Write Your Message!

Captcha
Order Assignment

Featured Services

Order Now

Popular Subjects

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd