Touro University International Essays (336 words) -

Touro University International James L. White ACC 501 Module 5, Session Long Project Dr. Paul R. Watkins INTRODUCTION The purpose of this report is to use my organization to identify a product or service in my organization that could use Activity Based Costing. I will then identify at least two activities for Activity Based Costing and the appropriate cost drivers for those activities. I will estimate the application rates for each cost driver. By discussing this topic I hope to provide the reader with some insight on the name and nature of my organization, the activity and time period I used, the inputs I used, my results and any implications from my results. I will conclude this report with a brief summary of the entire analysis, highlighting some of the most significant parts that the report contains. THE ORGANIZATION As I have mentioned in the past modules my job involves training, medical billing, cost center management, medical terminology, military medical readiness, aero medical evacuation, medical health records, patient eligibility, Health Insurance Portability Accountability Act (HIPAA), safety, customer service, Medical Expense and Performance Reporting System (MEPRS), equipment and supplies. Using the fiscal year 2005 resource report for Sheppard Air Force Base Medical Center I will be using supplies and equipment as my service. The medical center deals with massive amounts of supplies and equipment ranging from staplers to x-ray machines. The two activities for this service will be materials purchasing and material handling. The appropriate cost driver for materials purchased is the number of purchased orders and the appropriate cost driver for materials handled is the number of materials demanded. |Activity |Cost driver | |Materials |the number of purchased| |purchasing |orders | |Materials |the number of materials| |handled |demanded | CONCLUSION Using Activity Based Counseling in the medical center is important because it shows actual cost, facilitates better decision making with scarce resources, and shows the cost consequences of resource management decisions. If a company wants to reduce cost they must know more about current cost. Activity Based Costing will provide you with valuable insight into cost and performance within your organization for continuous improvement for present and future endeavors.