Constanza Company (a hospital) resorts to ‘simple costing’ (job-costing) system for patients with surgery requirements. In March 2015, the P-OPN room and OPN room used cost allocation bases (budgeted) of 40000 staff hours (nurses) and 20000 staff hours (nurses), respectively. For March 2015, total staff overhead costs (nurses) for these departments were $1680000 and $1320000, respectively. Overall overhead costs (budgeted) for the surgical part of the hospital were $12000000, with 150000 nursing hours for the month. Surgical patient Joe Smith spent 80 and 40 hours in the P-OPN and OPN rooms, respectively. He was in the hospital for 40 days (960 hours). The hospital charged ‘Misc. costs’ to Joe as follows:

A budgeted overhead rate is used in the hospital for applying overhead costs to each patient.