Capelli Hospital Bases Its Budgets on Patient-Visits -What Should Be the Total Variable Overhead Cost at an Budget

Capelli Hospital bases its budgets on patient-visits. The hospital's static budget for August appears below:
$\begin{array}{|l|r|}\hline \text { Budgeted number of patient-visits } & 8,300 \\\hline \text { Budgeted variable overhead costs: } & \\\hline \text { Supplies (@\$5.00 per patient-visit) } & \$ 41,500 \\\hline \text { Laundry (@\$7.30 per patient-visit) } &\underline{60,590}\\\hline \text { Total variable overhead cost } & 102,090 \\\hline \text { Budgeted fixed overhead costs: } & \\\hline \text { Wages and salaries } & 60,590 \\\hline \text { Occupancy costs } & \underline{73,040} \\\hline \text { Total fixed overhead cost } & 133,630 \\\hline \text { Total budgeted overhead cost } & \$ 235,720 \\\hline\end{array}$



-What should be the total variable overhead cost at an activity level of 9,300 patient-visits per month?

A) $114,390.
B) $149,730.
C) $102,090.
D) $133,630.

Correct Answer:

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