Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Operation Management Expert

Dr. Sherry Bird is employed by the Dental Associates. Dental Associates recently installed the computerized job-order costing system to help monitor the cost of its services. All patients are treated as a job and assigned a job number when he or she checks in with the receptionist. Receptionist-bookkeeper notes the time the patient enters the treatment area and when 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.) Direct labour time assigned to the dentist is 50 percent of the patient hours. (The dentist typically splits her time between two patients.)
Chart filled out by dental assistant provides extra data that is entered into the computer. For ex, the chart contains service codes which identify the nature of the treatment, like whether the patient received a crown, a filling, or a root canal. Chart not only identifies type of service but its level as well. Like, 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 the patient consist of materials, labour, and overhead. 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 the file and accessed to give the necessary cost information. Overhead is on the basis of patient hours. Rate used by Dental Associates is $20 per patient hour. Direct labour cost is also find outd using patient hours and the wage rates of the direct labourers. Dr. Bird is paid the average of $36 per hour for her services. Dental assistants are paid an average of $6 per hour. Given the treatment time, software program find outs and assigns the labour cost for the dentist and her assistant; overhead cost is also assigned using the treatment time and the overhead rate.
Overhead rate does not include a charge for any X-rays. 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 labour 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:

problem1) 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?

problem2) Assume that the patient time and associated patient charges are given for the following fillings:

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

find out 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 patient? Is it fair to the dental corporation?

Operation Management, Management Studies

  • Category:- Operation Management
  • Reference No.:- M9622

Have any Question? 


Related Questions in Operation Management

Please answer all of these questions based on the assigned

Please answer all of these questions based on the assigned readings and or your personal knowledge. 1-Compare and contrast entrepreneurship with working in a corporate environment as a department head. What are some resp ...

Sam certo a nanaimo vet is running a rabies vaccination

Sam Certo, a Nanaimo vet, is running a rabies vaccination clinic for dogs at the local grade school. Sam can "shoot" a dog every 3 minutes. It is estimated that the dogs will arrive independently and randomly throughout ...

Assignment-1identify the four types of layouts and their

Assignment- 1. Identify the four types of layouts and their characteristics. 2. The manufacturing engineers at Suny Manufacturing were working on a new remote- controlled toy Monster Truck. They hired a production consul ...

Your intern is confused about the difference between

Your intern is confused about the difference between physical and logical system models. Explain the difference between the two models to her and give at least one example for each of the two models.

When considering a country to enter with respect to global

When considering a country to enter with respect to global trade, business leaders must determine if the particular country under consideration has a sufficiently acceptable environment in which to operate. Based on your ...

Compare what happens with a tpm project and an apf project

Compare what happens with a TPM project and an APF project when a team member is taken off the team and no longer available. What are the impacts on each approach? Which approach is least affected by such a change? To do ...

How would you handle scope creep where do you draw the line

How would you handle scope creep? Where do you draw the line or when do you agree to make the changes? If you make the changes, what is the procedure?

Identify the determining dimension or dimensions that

Identify the determining dimension or dimensions that explain why you bought the specific brand you did. Try to express the determining dimension in term of your own personal characteristics. Estimate what share of the m ...

Please give a practical example each of contract of

Please give a practical example each of Contract of Indemnity and Contract of Guarantee. Also identify and highlight as to how these contracts, as quoted by you as examples, are different from each other. Need min of 100 ...

Questionread case study about the continuous improvement

Question: Read case study about the continuous improvement and innovation at a rural hospital. The case study discusses "spa-like amenities to increase market share." Is it possible for every hospital to achieve this? Wh ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro