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in Student Version Copyright 2010
8/24/09 by FACHE RIO GRANDE MEDICAL CENTER Cost Allocation Concepts This case focuses on cost allocation concepts, specifically the fairness and incentives created by a new allocation system applied to a department that is moving to a new, stand-alone facility.
The primary thrust of the case is qualitative rather than quantitative, but this model can be used to compare results under alternative allocation schemes. The model consists of a complete base case analysis--no changes need to be made to the existing
MODEL-GENERATED DATA section. However, in the student version all values in the INPUT DATA section have been replaced with zeros. Thus, students must enter the appropriate values into the red cells that currently contain a zero or hyphen. When this is done, any error cells will be corrected and the base case solution will appear. Note that the model does not contain any uncertainty analyses, so students will have to create their own if required by the case. Furthermore, students must create their own graphics output (charts) as needed to present their results.
INPUT DATA: KEY OUTPUT: Dialysis Center Data: Dialysis Ctr Outpatient Ctr Total
Total revenues $- Facilities allocation ($) $- $1,900,000 $1,900,000
Total direct expenses $- Per square foot $- $19.00 $15.83
Facilities costs $- Gen overhead alloc. - 2,270,000 2,270,000
General overhead $- Per revenue $ #DIV/0! 11.4% 11.4% Total indirect costs $- $4,170,000 $4,170,000 Net profit
8/24/09 by FACHE RIO GRANDE MEDICAL CENTER Cost Allocation Concepts This case focuses on cost allocation concepts, specifically the fairness and incentives created by a new allocation system applied to a department that is moving to a new, stand-alone facility.
The primary thrust of the case is qualitative rather than quantitative, but this model can be used to compare results under alternative allocation schemes. The model consists of a complete base case analysis--no changes need to be made to the existing
MODEL-GENERATED DATA section. However, in the student version all values in the INPUT DATA section have been replaced with zeros. Thus, students must enter the appropriate values into the red cells that currently contain a zero or hyphen. When this is done, any error cells will be corrected and the base case solution will appear. Note that the model does not contain any uncertainty analyses, so students will have to create their own if required by the case. Furthermore, students must create their own graphics output (charts) as needed to present their results.
INPUT DATA: KEY OUTPUT: Dialysis Center Data: Dialysis Ctr Outpatient Ctr Total
Total revenues $- Facilities allocation ($) $- $1,900,000 $1,900,000
Total direct expenses $- Per square foot $- $19.00 $15.83
Facilities costs $- Gen overhead alloc. - 2,270,000 2,270,000
General overhead $- Per revenue $ #DIV/0! 11.4% 11.4% Total indirect costs $- $4,170,000 $4,170,000 Net profit