(i) Computing Overhead Rates Using the Direct MethodUsing the information in E 6 about the

(i) Computing Overhead Rates Using the Direct Method

Using the information in E 6 about the operations of Broomfield Occupational Therapy Services and assuming that the costs incurred in the revenue centers are for overhead, determine the overhead rate per patient visit for each revenue center. Revenue Center C had 900 patient visits, and Revenue Center D had 1,800 patient visits.

(ii) Computing Overhead Rates Using the Step Method

Using the information in E 9 about the operations of Blue River Physical Therapy Services and assuming that the costs incurred in the revenue centers are for overhead, determine the overhead rate per patient visit for each revenue center. Revenue Center Y had 900 patient visits, and Revenue Center Z had 1,800 patient visits.

 

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