LSUS MHA 706 FINAL Exam Questions with Complete Solutions Graded A+
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Module
LSUS MHA 706
Institution
LSUS MHA 706
1. Cost Driver is the... Answer: basis cost pool will be allocated
2. Cost Pool is the... Answer: overhead amount to be allocated
3. Overhead Departments are... Answer: often called cost centers
4. Indirect Costs Answer: Costs of shared resources used by the entire organization
5. Patient Servi...
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LSUS MHA 706 FINAL
Exam Questions with
Complete Solutions
Graded A+
Denning Muriithi [Date] [Course title]
, LSUS MHA 706 FINAL - LORD
1. Cost Driver is the... Answer: basis cost pool will be allocated
2. Cost Pool is the... Answer: overhead amount to be allocated
3. Overhead Departments are... Answer: often called cost centers
4. Indirect Costs Answer: Costs of shared resources used by the entire
organization
5. Patient Service Departments are... Answer: often called revenue centers
6. Direct Costs are... Answer: costs unique and exclusive to a department
7. "Dollars in the Cost Pool" / "Total Volume of Cost Driver" = Answer:
Allocation Rate
8. Effective cost drivers should have what characteristics(s)? Answer: -
Promote orga- nizational cost reduction
-Perceived as being fair
9. is NOT a type of allocation method? Answer: Step-Up Method
10. As an Accounting Manager - you are responsible for allocating the cost
of facilities to other departments. What would be an appropriate cost driver
for you to use for this allocation? Answer: -Square footage of the
department
-Housekeeping
11.TRUE/FALSE Answer: Once a company uses the Direct Method to allocate
costs to revenue-producing departments within the facility - the total level of
expenses decreases for the organization. Answer: False
12.When using the direct cost allocation system - often you are allocating
the cost of to Patient Service Departments. Answer: Support
(overhead) Departments
13. are accounting methods to account for "cost" at an
individual service level. Answer: Time Driven-Costing (TDBC)
Activity Based Costing
(ABC) Cost-to-Charge
Ratio (CCR) Relative
Value (RVU)
14. are true assumption(s) of the Cost-to-Charge Ratio Method.
Answer: - Each service consumes overhead costs in the same proportion
as the department as a whole
Charges reflect the level of intensity of the service provided.
15.Activity Based Costing (ABC) begins with that comprise the
service provided. Answer: Individual Activities
16.Calculate... Answer: total costs of the service by aggregating activity
costs
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