Health Care Accounting Health Care Accounting INTRODUCTION The environment wi

The findings of this examination are presented in three separate discussions. The first of these discussions considers existing cost models employed in health care and hospital administration, while the second discussion examines the twostage activitybased cost accounting procedure, and the third

1D. W. Young, "Cost Accounting and Cost Comparisons: Methodological Issues and Their Policy and Management Implications," Accounting Horizons, v. 2, March 1988, pp. 6869.

2S. Mendenhall, R. Shepherd, and E. Kabrinski, "Cost Accounting in Health Care Organizations: Who Needs It?" Health Care Financial Management, v. 4, January 1987, p. 40.

3R. Cooper, "The TwoStage Procedure in Cost Accounting: Part One," Jorunal of Cost Management for the Manufacturing Industry, v. 1, Summer 1987, pp. 4351; R. Cooper, "The TwoStage Procedure in Cost AccountingPart Two," Jorunal of Cost Management for the Manufacturing Industry, v. 1, Fall 198

. . .
of every resource consumed by all products is directly proportional to the number of direct labor hours consumed."10 The __________ 8Cooper, Fall 1987, p. 39. 9Cooper, Summer 1987, pp. 43. 10Ibid., pp. 4950. 5 application of this approach to costing is satisfactory only in those production situations where only one cost driver (resource) and one cost pool (product) are involved.11 The second costing approach relates direct labor and supervision to products independently. To accomplish this goal, (1) the total cost of direct labor is divided by the total number of direct labor hours, and (2) the total cost of supervision is divided by the total number of supervisory hours. This procedure yields separate labor burden rates for direct labor and supervision. These separate labor burden rates are then multiplied by the number of direct labor hours and the number of supervisory hours, as appropriate, consumed by a specific product, to derive the costing for that product. This costing approach "distorts product costs in most production environments," because of an assumption underlying the costing approach that the segment of a production process in which a resource is consumed does not cause the cost per unit of a reso
. . .

Some common words found in the essay are:
Financial Management, COST ACCOUNTING, CONCLUSION RECOMMENDATION, MODELS Health, , Financial Management, Manufacturing Industry, cost accounting, COSTING Contemporary, health care, direct labor, twostage activitybased, activitybased cost, twostage activitybased cost, activitybased cost accounting, Accounting Horizons, Services Administration, cost accounting procedure, accounting procedure, 1987 pp, labor burden, approach costing, health care financial, care financial, direct labor supervision,
Approximate Word count = 2286
Approximate Pages = 9 (250 words per page)