The controller for Rainbow Children\'s Hospital, located in Munich, Germany, est
ID: 2332367 • Letter: T
Question
The controller for Rainbow Children's Hospital, located in Munich, Germany, estimates that the hospital uses 30 kilowatt-hours of electricity per patient-day, and that the electric rate will be .10 euro per kilowatt-hour. The hospital also pays a fixed monthly charge of 1,000 euros to the electric utility to rent emergency backup electric generators. Required Construct a flexible budget for the hospital's electricity costs using each of the following techniques. . Formula flexible budget 2. Columnar flexible budget for 30,000, 40,000 and 50,000 patient-days of activity. Complete this question by entering your answers in the tabs below Required 1 Required 2 Formula flexible budget. Total budgeted Budgeted variable monthly overhead cost per x overhead cost Total activityoverhead cost Bugeted fixed units activity unit per month x patient days +Explanation / Answer
Requirement 1
Total Budgeted monthly overhead cost =
Budgeted Variable overhead cost per Activity unit
x
Total Activity units
+
Budgeted fixed overhead cost per unit
€ 1000+Variable cost
€ 3.00
x
+
€ 1,000.00
Requirement 2
Flexible budget
Patient days
Variable Electricity cost
€ 90,000.00
€ 120,000.00
€ 150,000.00
Fixed Electricity cost
€ 1,000.00
€ 1,000.00
€ 1,000.00
Total Electricity Cost
€ 91,000.00
€ 121,000.00
€ 151,000.00
Working
Variable electricity cost
(A)
Patient days
30000
40000
50000
(B)
rate per patient day
€ 3.00
€ 3.00
€ 3.00
(AxB)
Total Variable electricity cost
€ 90,000.00
€ 120,000.00
€ 150,000.00
Total Budgeted monthly overhead cost =
Budgeted Variable overhead cost per Activity unit
x
Total Activity units
+
Budgeted fixed overhead cost per unit
€ 1000+Variable cost
€ 3.00
x
+
€ 1,000.00
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