A. Poehling Medical Center has a single operating room that is used by local phy

Question

A. Poehling Medical Center has a single operating room that is used by local physicians to perform surgical procedures. The cost of using the operating room is accumulated by each patient procedure and includes the direct materials costs (drugs and medical devices), physician surgical time, and operating room overhead. On January 1 of the current year, the annual operating room overhead is estimated to be: Disposable supplies $247,700 Depreciation expense 44,700 Utilities 26,000 71,900 21,700 $812,000 Nurse salaries Technician wages Total operating room overhead

Explanation / Answer

A.  

a. Estimated number of operating room hours = 7 hours x 7 days x 50 weeks = 2450 hours

b. Predetermined operating room overhead rate = $812,000/2450 = $331.428 per hour

c. Operating room overhead charged = 7 hours x $331.428 = $2320

d. Overhead applied - Actual overhead = (186 x $2320) - $52,800 = $431520 - $52,800 = $378720 overapplied.

THANK YOU.

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