PART II: NEW SCENARIO – GHA 4 To complete PART II, you will need to follow the same process as Part

PART II: NEW SCENARIO – GHA 4 To complete PART II, you will need to follow the same process as Part I. In this scenario, the direct costs have remained the same, however the indirect costs and allocation basis have been changed. Here is the information that you will need to complete Part II. DIRECT COSTS The direct costs for each department are easily identifiable, because they are the costs that are directly attributable to the department. The direct costs are as follows: Physical Therapy (PT) 410,000 Occupational Therapy (OT) 190,000 Speech Therapy (ST) 120,000 Total Direct Costs 720,000 INDIRECT COSTS The indirect costs will need to be allocated to Physical Therapy (PT), Occupational Therapy (OT), and Speech Therapy (ST). The indirect costs in this scenario have been identified as: (1) Clerical Salaries, (2) Administrative Salaries, and (3) Computer Services. The total indirect costs that need to be allocated to PT, OT, and ST are as follows: Clerical Salaries 56,000 Administrative Salaries 55,000 Computer Services 80,000 Total Indirect Costs 191.000 Each type of indirect cost will need to be allocated to each department based on an allocation basis that is appropriate for the particular type of cost. Clerical Salaries will be allocated based on Visit Volume. Administrative Salaries will be allocated based on the Proportion of Direct Costs Computer Services will be allocated based on the Number of Computers in Service. Computers in Service 10 Physical Therapy (PT) Occupational Therapy (OT) Speech Therapy (ST) Total Visit Volume 9,600 4,000 2.400 16,000 16 Step 1: Set-up a Table of Direct and Indirect Costs Direct Cost Indirect Cost Total Physical Therapy (PT) Occupational Therapy (OT) Speech Therapy (ST) Totals Step Der the indic a t ed from Clerical Sale Clerical res The total indirect costs for Clerical Salaries is Clerical Salaries will be weted based on Visit Valme The Vis V efur PT, OT, ST are a few Physical Therapy PT) Occupational Therapy (OT) Speech Therapy (ST) To Visit Volume Raudhi VV, the paper Physical Therapy (PT) Owonal Therapy (OT) Speech Therapy (ST) w the percepe of Total Womes to de t ection of the structure for Clica Salari costs for Clerical Salaries Physical Therapy (PT) Occupational Therapy (OT) Speech Therapy (ST) Total Indirect Salaries The total indirect costs for Administrative Salaries is Admistrative Salaries will be allocated based on the proportion () of direct costs. The Direct Costs for PT, OT, and ST are as follows: Physical Therapy (PT) Occupational Therapy (OT) Speech Therapy (ST) Total Visit Volume proportion of the direct costs is as follows: Physical Ther (PT) Occupational Therapy (OT) Speech Therapy (ST) the proportion of the directs to determine the allocation of the Indirect Costs for Administrative Salari Total indirect costs for Clerical Salaries Physical Therapy (PT) Occupational Therapy (OT) Speech Therapy (ST) Total Indirect The total indirect costs for Computer Services is Computer Services will be allocated based on the hero computers The number of competenservice for PT.OT. and ST are as follows: Physical Therapy (PT) O ptional Therapy (OT) Speech Therapy (ST) Tal Via Volume The properties of materia i s as follows Physical Therapy PT) Owonal Therapy OT) Speech Therapy (ST) Toal the direct C C S the price of the Totalt compare to determine the for mer Services Payal The PT Olow al Therapy EOT Speech Therapy (ST) Total Indirectests Step 3: Determine to total indirect costs for PT, OT and ST. Based on your calculations in Step 2. you can create a table to determine the total indirect costs for PT, OT, and ST: Clerical Salaries) Administrative Salaries Computer Services TOTAL INDIRECT COSTS Physical Therapy (PT) Occupational Therapy (OT) Speech Therapy (ST) Total Indirect Costs Step 4: Add the direct costs by department from Step I to the total indirect costs by department from Step 3 to get your total costs. (Step 1) (Step 3) Direct Cost Indirect Cost Total Physical Therapy (PT) Occupational Therapy (OT) Speech Therapy (ST) Total

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