Using Table 8.21, allocate the indirect costs in the indirect cost pool using total direct costs as the method or base. What is the total cost, or full cost, of each of the four programs?

Using Table 8.21, allocate the indirect costs in the indirect cost pool using total direct costs as the method or base. What is the total cost, or full cost, of each of the four programs?

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Exercise 8.1
Using Table 8.21, allocate the indirect costs in the indirect cost pool using total
direct costs as the method or base. What is the total cost, or full cost, of each of the
four programs? Assuming the total outputs (or units of service) remain the same
for the visiting nurse program, the homemaker program, and the home-delivered
meals program and that the specialized transportation program will make 9,000
person trips during the year, what is the cost per output (or unit of service) for each
of the four programs? Assuming that all four programs share the same outcome
measure and that the total number of outcomes (125) remains the same, what is the
cost per outcome?
Exercise 8.2
Using Table 8.21, allocate the indirect costs in the indirect cost pool using salaries
and wages as the method or base. What is the total cost, or full cost, of each of the
four programs? Assuming the total outputs (or units of service) remain the same
for the visiting nurse program, the homemaker program, and the home-delivered
meals program and that the specialized transportation program will make 9,000
person trips during the year, what is the cost per output (or unit of service) for each
of the four programs? Assuming that all four programs share the same outcome
measure and that the total number of outcomes (125) remains the same, what is the
cost per outcome?

TABLE 8.21 Houston Home Care Agency Cost Allocation Plan Format
Budget Line Items
Salaries and Wages
Executive director
Financial manager
3 secretaries
Nursing coordinator (N)
4 nurses (N)
Homemaker coordinator (H)
15 homemakers
Home-delivered meals
coordinator (M and T)
2 van drivers (M and T)
Salaries and Wages (Total)
Employee-Related Expenses
(@ 22% of salaries & wages)
Other Operating Expenses

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